Ans: D) you should use heteroskedasticity-robust standard errors.
When calculating the TSLS standard errors
A) you do not have to worry about heteroskedasticity, since it was eliminated in the first stage
B) you can use the standard errors reported by OLS estimation of the second stage regression.
C) the critical values from the standard normal table should be adjusted for the proper degrees of freedom.
D) you should use heteroskedasticity-robust standard errors.
Economics
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Refer to Figure 5-9. Suppose the government wants to use a Pigovian tax to bring about the efficient level of production. What should the value of the tax be?
A) (P1- P0 ) per unit of output B) P1 per unit of output C) (P2- P0 ) per unit of output D) (P2- P1 ) per unit of output
Economics
If the income effect of a change in the wage dominates the substitution effect, then workers will want to work more when the wage increases.
Answer the following statement true (T) or false (F)
Economics