Quiz 6 - Chap 7

11/5/23, 3:34 PM Review Test Submission: Online Quiz 6 (Chapter 7) – ...
Hai Nhu Thai 160

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ECON3006 (Vietnam Session 3 2023) Economic and Financial Modelling

Assessment 3 (10%) - Online Quizzes Review Test Submission: Online Quiz 6 (Chapter 7)
Review Test Submission: Online Quiz 6 (Chapter 7)
User Hai Nhu Thai

Subject ECON3006 (Vietnam Session 3 2023) Economic and Financial Modelling
Test Online Quiz 6 (Chapter 7)
Started 5/11/23 7:24 PM
Submitted 5/11/23 7:34 PM
Due Date 6/11/23 3:59 AM
Status Completed
Attempt Score 10 out of 10 points
Time Elapsed 10 minutes out of 20 minutes
Results All Answers, Submitted Answers, Correct Answers, Incorrectly Answered
Displayed Questions
Question 1 1 out of 1 points
Changing the unit of measurement of any independent variable, where log of the
dependent variable appears in the regression:
Selected Answer: affects only the intercept coefficient.
Answers: affects only the intercept coefficient.
affects only the slope coefficient.
affects both the slope and intercept coefficients.
affects neither the slope nor the intercept coefficient.
Which of the following is true of Regression Specification Error Test (RESET)?
Selected
Answer: It tests if the functional form of a regression model is
misspecified.
Answers:
It tests if the functional form of a regression model is
misspecified.
https://vuws.westernsydney.edu.au/webapps/assessment/review/review.jsp?attempt_id=_31229819_1&course_id=_47714_1&content_id=_9641801_1&return_c… 1/5
It detects the presence of dummy variables in a regression

model.
It helps in the detection of heteroskedasticity when the

functional form of the model is correctly specified.
It helps in the detection of multicollinearity among the

independent variables in a regression model.
In the following equation, gdp refers to gross domestic product, and FDI refers to
foreign direct investment.
Which of the following statements is then true?

Selected
Answer: If bank credit increases by 1%, gdp increases by 0.527%, the
level of FDI remaining constant.
Answers: If gdp increases by 1%, bank credit increases by 0.527%, the

If bank credit increases by 1%, gdp increases by 0.527%, the

If gdp increases by 1%, bank credit increases by log(0.527)%,

the level of FDI remaining constant.
If bank credit increases by 1%, gdp increases by log(0.527)%,

Which of the following is true?
Selected
Answer: A functional form misspecification can occur if the level of a
variable is used when the logarithm is more appropriate.
Answers:
A functional form misspecification can occur if the level of a
variable is used when the logarithm is more appropriate.
A functional form misspecification occurs only if a key variable

is uncorrelated with the error term.
A functional form misspecification does not lead to biasedness

in the ordinary least squares estimators.
A functional form misspecification does not lead to

inconsistency in the ordinary least squares estimators.
Which of the following correctly identifies an advantage of using adjusted R2

over R2?
Selected
Answer: The penalty of adding new independent variables is better
understood through adjusted R2 than R2.
Answers:
Adjusted R2 corrects the bias in R2.
Adjusted R2 is easier to calculate than R2.
The penalty of adding new independent variables is better

understood through adjusted R2 than R2.
The adjusted R2 can be calculated for models having

logarithmic functions while R2 cannot be calculated for such
models.
Consider the following regression model: log(y) = β0 + β1x1 + β2x12 + β3x3 +

u. This model will suffer from functional form misspecification if _____.
Selected Answer: x12 is omitted from the model
Answers: β0 is omitted from the model
u is heteroskedastic
x12 is omitted from the model
x3 is a binary variable
Selected
Answer: If bank credit increases by 1%, gdp increases by 0.527%, the
Answers: If gdp increases by 1%, bank credit increases by 0.527%, the

If bank credit increases by 1%, gdp increases by 0.527%, the

If gdp increases by 1%, bank credit increases by log(0.527)%,

If bank credit increases by 1%, gdp increases by log(0.527)%,

An independent variable can be included in a regression model:
Selected
Answer: when it affects y and is uncorrelated with all of the
independent variables of interest.
Answers:
when it affects y and is uncorrelated with all of the
when it does not affect y and is uncorrelated with all of the
when it affects y and is correlated with all of the

when it does not affect y and is correlated with all of the

A regression model suffers from functional form misspecification if _____.
Selected Answer: an interaction term is omitted.
Answers: a key variable is binary.
the dependent variable is binary.
an interaction term is omitted.
the coefficient of a key variable is zero.

Selected
Answer: If FDI increases by 1%, gdp increases by approximately 24.8%,
the amount of bank credit remaining constant.
Answers: If FDI increases by 1%, gdp increases by approximately 22.2%,

If FDI increases by 1%, gdp increases by approximately 26.5%,



Sunday, 5 November 2023 7:34:26 PM AEDT
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11/5/23, 3:34 PM Review Test Submission: Online Quiz 6 (Chapter 7) – ...

Hai Nhu Thai 160

ECON3006 (Vietnam Session 3 2023) Economic and Financial Modelling

Review Test Submission: Online Quiz 6 (Chapter 7)

User Hai Nhu Thai

Question 1 1 out of 1 points

Selected Answer: affects only the intercept coefficient.

Answers: affects only the intercept coefficient.

affects only the slope coefficient.

affects both the slope and intercept coefficients.

affects neither the slope nor the intercept coefficient.

Question 2 1 out of 1 points

Which of the following is true of Regression Specification Error Test (RESET)?

It detects the presence of dummy variables in a regression

It helps in the detection of heteroskedasticity when the

It helps in the detection of multicollinearity among the

Question 3 1 out of 1 points

Which of the following statements is then true?

Answers: If gdp increases by 1%, bank credit increases by 0.527%, the

If bank credit increases by 1%, gdp increases by 0.527%, the

If gdp increases by 1%, bank credit increases by log(0.527)%,

If bank credit increases by 1%, gdp increases by log(0.527)%,

Question 4 1 out of 1 points

Which of the following is true?

A functional form misspecification occurs only if a key variable

A functional form misspecification does not lead to biasedness

A functional form misspecification does not lead to

Question 5 1 out of 1 points

Which of the following correctly identifies an advantage of using adjusted R2

Adjusted R2 is easier to calculate than R2.

The penalty of adding new independent variables is better

The adjusted R2 can be calculated for models having

Question 6 1 out of 1 points

Consider the following regression model: log(y) = β0 + β1x1 + β2x12 + β3x3 +

Selected Answer: x12 is omitted from the model

Answers: β0 is omitted from the model

x12 is omitted from the model

Question 7 1 out of 1 points

Which of the following statements is then true?

Answers: If gdp increases by 1%, bank credit increases by 0.527%, the

If bank credit increases by 1%, gdp increases by 0.527%, the

If gdp increases by 1%, bank credit increases by log(0.527)%,

If bank credit increases by 1%, gdp increases by log(0.527)%,

Question 8 1 out of 1 points

An independent variable can be included in a regression model:

when it affects y and is correlated with all of the

when it does not affect y and is correlated with all of the

Question 9 1 out of 1 points

A regression model suffers from functional form misspecification if _____.

Selected Answer: an interaction term is omitted.

Answers: a key variable is binary.

the dependent variable is binary.

an interaction term is omitted.

the coefficient of a key variable is zero.

Question 10 1 out of 1 points

Which of the following statements is then true?

Answers: If FDI increases by 1%, gdp increases by approximately 22.2%,

If FDI increases by 1%, gdp increases by approximately 26.5%,

If FDI increases by 1%, gdp increases by approximately 24.8%,

If FDI increases by 1%, gdp increases by approximately 52.7%,

Sunday, 5 November 2023 7:34:26 PM AEDT

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