Multiple Choice
Consider the following regression equation: 
. Which of the following indicates a functional form misspecification in E(y|x) ?
A) Ordinary Least Squares estimates equal Weighted Least Squares estimates.
B) Ordinary Least Squares estimates exceed Weighted Least Squares estimates by a small magnitude.
C) Weighted Least Squares estimates exceed Ordinary Least Squares estimates by a small magnitude.
D) Ordinary Least Square estimates are positive while Weighted Least Squares estimates are negative.
Correct Answer:
Verified
Correct Answer:
Verified
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