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Consider the Following Simple Regression Model Y = β0

Question 25

Multiple Choice

Consider the following simple regression model y = β0 + β1x1 + u. Suppose Corr(x,u) > 0, Corr(z,x) > 0, and Corr(z,u) < 0. Then, the IV estimator has a(n) _____.​


A) ​downward bias
B) ​asymptotic bias
C) ​upward bias
D) ​substantial bias

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