Which of the following is not a way in which dynamic models differ from OLS?
A) Different interpretation of the coefficient.
B) Correlated errors cause bias in dynamic models.
C) Will have smaller standard errors than OLS.
D) Coefficients can be biased if an irrelevant lagged variable is included.

Question

Quizplus · Accepted Answer

Dynamic models are generally more complex than OLS and hence, they usually have larger standard errors. Therefore, option C is incorrect. Options A, B, and D are all valid ways in which dynamic models differ from OLS.

Which of the Following Is Not a Way in Which