Multiple Choice
Suppose you are estimating the following model: Yi = β0 + β1Xi + Ui. Suppose also that you only observe values of Y that are above 50. What is the consequence of this selection on the values of Y?
A) Your estimate for β1 will be biased.
B) Your model will suffer from the heteroscedasticity problem.
C) Your estimate for β1 will be biased and your model will suffer from the heteroscedasticity problem.
D) None of the answers is correct.
Correct Answer:
Verified
Correct Answer:
Verified
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