First-differenced models are preferable to pooled cross-section models because they
A) control for potential autocorrelation.
B) control for potential heteroskedasticity.
C) control for the random effects in the data.
D) remove the time constant component in the error term.
Correct Answer:
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Q1: Panel data differs from time-series data in
Q3: The fact that panel data varies across
Q4: If there is a pooled cross-section model
Q5: Fixed-effects models are more appropriate than random-effects
Q6: One can first-difference panel data in a
Q7: Fixed-effects models
A)remove the time-variant component of the
Q8: Pooled cross-section models
A)control for individual fixed-effects.
B)combine observations
Q9: Treating each data point in panel data
Q10: Fixed-effects models are preferable to pooled cross-section
Q11: Fixed-effects models and first-differenced models
A)assume that the
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