The classical errors-in-variables (CEV) assumption is that _____.
A) the error term in a regression model is correlated with all observed explanatory variables
B) the error term in a regression model is uncorrelated with all observed explanatory variables
C) the measurement error is correlated with the unobserved explanatory variable
D) the measurement error is uncorrelated with the unobserved explanatory variable
Correct Answer:
Verified
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A)increases the error variance
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