econ2p91_ReviewQuestionsMultipleChoice_Chapter10

econ2p91_ReviewQuestionsMultipleChoice_Chapter10 - Review...

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Review Questions: Chapter 10 Regression with Panel Data Multiple Choice 1) The notation for panel data is ( , ), 1,. .., it it X Y i n = and 1,. .., t T = because a. we take into account that the entities included in the panel change over time and are replaced by others. b. the X ’s represent the observed effects and the Y the omitted fixed effects. c. there are n entities and T time periods. d. n has to be larger than T for the OLS estimator to exist. 2) The difference between an unbalanced and a balanced panel is that .a you cannot have both fixed time effects and fixed entity effects regressions. .b an unbalanced panel contains missing observations for at least one time period or one entity. .c the impact of different regressors are roughly the same for balanced but not for unbalanced panels. .d in the former you may not include drivers who have been drinking in the fatality rate/beer tax study. 3) The Fixed Effects regression model .e has n different intercepts. .f the slope coefficients are allowed to differ across entities, but the intercept is “fixed” (remains unchanged). .g has “fixed” (repaired) the effect of heteroskedasticity. .h
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econ2p91_ReviewQuestionsMultipleChoice_Chapter10 - Review...

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