A study based on OLS regressions is internally valid if
A)the errors are homoskedastic, and there are no more than two binary variables present among the regressors.
B)you use a two-sided alternative hypothesis, and standard errors are calculated using the heteroskedasticity-robust formula.
C)weighted least squares produces similar results, and the t-statistic is normally distributed in large samples.
D)the OLS estimator is unbiased and consistent, and the standard errors are computed in a way that makes confidence intervals have the desired confidence
Level.

Question

Quizplus · Accepted Answer

The internal validity of an OLS regression study is ensured when the OLS estimator is unbiased and consistent, and the standard errors are computed correctly to ensure that confidence intervals have the desired confidence level.

A Study Based on OLS Regressions Is Internally Valid If