Which of the Following Assumptions Is Needed for the Usual

Multiple Choice

Which of the following assumptions is needed for the usual standard errors to be valid when differencing with more than two time periods?

A) The regression model exhibits heteroskedasticty.
B) The differenced idiosyncratic error or u_it is uncorrelated over time.
C) The unobserved factors affecting the dependent variable are time-constant.
D) The regression model includes a lagged independent variable.