How does including an irrelevant variable in a regression model affect the estimated coefficient of other variables in the model?
A)they are biased downward and have smaller standard errors
B)they are biased upward and have larger standard errors
C)they are biased and the bias can be negative or positive
D)they are unbiased but have larger standard errors

Question

Quizplus · Accepted Answer

Including an irrelevant variable in a regression model does not bias the estimated coefficients of other variables, but it can lead to larger standard errors for those estimates. This is because the irrelevant variable consumes degrees of freedom and introduces unnecessary variability into the model.

How Does Including an Irrelevant Variable in a Regression Model