Which one of the following is NOT an example of misspecification of functional form in regression analysis?
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JNU SIS 2021 Question 8: Misspecification and measurement error
Answer and worked solution
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Misspecification and measurement error has come up 11 times in 4 exams since 2011.
What this question tests
This question is on Irrelevant variables and functional-form misspecification, part of Misspecification and measurement error in Econometrics.
The cost of including a variable that does not belong, and of using the wrong functional form.
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Question from the JNU SIS 2021 paper. Solutions are TestStop's own. Not affiliated with or endorsed by any examination authority.