Econ - Exercise 9

Question 1

Which test is used to check for autocorrelation

Accepted Answer

Durbin-Watson test

Question 2

Which test allows us to check model specification for omitted variables?

Accepted Answer

RESET

Question 3

To test model specification graphically, we need to calculate

Accepted Answer

Standardized residuals

Question 4

Which STATA command can be used to calculate residuals from our model

Accepted Answer

predict [var_name], resid

Question 5

The "corr" command in STATA allows us to use the Cochrane-Orcutt method

Accepted Answer

False

Question 6

Stata allows us to use Weighted Least Squares method if we need it

Accepted Answer

True

Question 7

One option how to remove multicollinearity is to remove a variable from the model.

Accepted Answer

True

Question 8

What we WANT in our model?

Accepted Answer

Homoskedasticity

Question 9

We need to use the following command in STATA to use the RESET test:

Accepted Answer

ovtest

Question 10

Which indicator helps us test our model for multicollinearity?

Accepted Answer

Variance inflation factor (VIF)

Question 11

Cochrane-Orcutt method can be used to remove

Accepted Answer

Autorocorrelation

Questions 11