Which of the Following Is Not a Reason Random Effects

Multiple Choice

Which of the following is not a reason random effects (RE) results may be preferred to fixed effects (FE) ?

A) RE accounts for the random sampling process that generated the data
B) RE is a GLS estimator so in large samples it has a smaller variance than FE which is a least squares estimator
C) RE produces a coefficient for race,gender,or other individual characteristics that are constant over time
D) RE estimates are more robust in the case of endogenous regressors