Re: DSE 2013 Answer Key is posted

Posted by Akshay Jain on May 27, 2014; 1:51pm
URL: http://discussion-forum.276.s1.nabble.com/DSE-2013-Answer-Key-is-posted-tp7590583p7590799.html

The ques says that the var(error term) is not related to the variable x that is included in the model but to variable z dat is not included in the model...
if we use OLS in presence of hetroscedasticity den var(B2) vl be biased...the interpretation of this lies in the defination of heterscedasticity which states that var(error term) is related to a variable dat is included in the model....if var(error term) is related to sm other variable outside the model then var(B2) vl b unbiased.....
I hope this line of reasoning makes sence....