The random error term ________ the effects of ________ influences on the dependent variable that are not included as explanatory variables.
A)captures; observed
B)ignores; unobserved
C)ignores; observed
D)captures; unobserved

Question

Quizplus · Accepted Answer

The random error term captures the effects of unobserved influences on the dependent variable that are not included as explanatory variables. This is why it is often referred to as the "unexplained variance" in the model. Therefore, the best choice is D, which correctly identifies the error term as capturing unobserved influences. Choices A, B, and C are incorrect because they either suggest that the error term ignores observed influences (which is not true) or that it captures observed influences (which is redundant, since the explanatory variables should already be capturing these).

The Random Error Term ________ the Effects of ________ Influences

The Random Error Term the Effects of Influences