Sample selection bias
A) occurs when a selection process influences the availability of data and that process is related to the dependent variable.
B) is only important for finite sample results.
C) results in the OLS estimator being biased, although it is still consistent.
D) is more important for nonlinear least squares estimation than for OLS.
Question 2
Omitted variable bias
A) will always be present as long as the regression R2 < 1.
B) is always there but is negligible in almost all economic examples.
C) exists if the omitted variable is correlated with the included regressor but is not a determinant of the dependent variable.
D) exists if the omitted variable is correlated with the included regressor and is a determinant of the dependent variable.
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