Exclusion Restrictions Are Said to Be Imposed in a Two-Equation

Multiple Choice

Exclusion restrictions are said to be imposed in a two-equation simultaneous equations model if it is assumed that:

A) certain exogenous variables do not appear in the first equation and others are absent from the second equation.
B) certain endogenous variables do not appear in the first equation and others are absent from the second equation.
C) the error terms in each equation is correlated with the exogenous variables.
D) the error terms in each equation is uncorrelated with the exogenous variables.