cov (u_it, u_is | X_it, X_is = 0 for t ? s means that A)there is no perfect multicollinearity in the errors. B)division of errors by regressors in different time periods is always zero. C)there is no correlation over time in the residuals. D)conditional on the regressors, the errors are uncorrelated over time.

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Quizplus · Accepted Answer

The notation cov(u_it, u_is | X_it, X_is = 0 for t ≠ s) indicates that, given the regressors, the covariance between errors at different time points (t and s) is zero, meaning the errors are uncorrelated over time when conditioned on the regressors.

Cov (Uit, Uis | Xit, Xis = 0 for T

Cov (U_it, U_is | X_it, X_is = 0 for T