Multiple Choice
Suppose we omit X2 from the following in a bivariate model
Yi = 0 + 1X1i + i
And suppose X2 is negatively related to X1 and 2 is positive, while 1 is positive. What is the likely effect of omitting X2 on our estimate of 1?
A) No effect; 1hat will be unbiased.
B) 1hat will be more positive than it should be.
C) 1hat will be less positive than it should be.
D) 1hat will equal zero.
Correct Answer:

Verified
Correct Answer:
Verified
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