The parameters of an econometric model _____.
A)include all unobserved factors affecting the variable being studied
B)describe the strength of the relationship between the variable under study and the factors affecting it
C)refer to the explanatory variables included in the model
D)refer to the predictions that can be made using the model

Question

Quizplus · Accepted Answer

Parameters in an econometric model describe the strength and nature of the relationship between the dependent variable and the independent variables or factors affecting it. They quantify how changes in the explanatory variables are associated with changes in the dependent variable.

The Parameters of an Econometric Model _____