ECONOMETRICS MIDTERM MULTIPLE CHOICE
QUESTIONS WITH VERIFIED ANSWERS
A causal effect of X on Y is defined as:
A) a non-zero correlation between X and Y
B.) a positive relationship between X and Y
C.) either positive, negative or non-linear relationship between X and Y
D.) either a positive, negative or non-linear relationship between X and Y when all other
variables that affect Y are held constant - Answers - D
Correlation between X and Y can only be interpreted as a causal relationship of X and Y
if:
A.) Y is unaffected by X in a linear way
B.) Y is an affected by any variable other than X
C.) Y is unaffected by any variable that is correlated with X
D.) Both A and C - Answers - D
If the variance of grades in this course is 16, each student should (unconditionally)
expect their grade to deviate from the class average by:
A.) 32 points
B.) 16 points
C.) 8 points
D.) 4 points - Answers - D
The variance of a random variable Y:
A.) is always less than the variance of the simple mean
B.) is always greater than the variance of the same mean
C.) is equal to the variance of the same mean when the sample size is 1
D.) none of the above - Answers - C
As the sample size increases, the variance of the sample mean
A.) increases
B.) decreases
C.) stays constant
D.) not enough info to know - Answers - B
A negative covariant between X and Y implies that
A.) as X increases, Y increases
B.) there is no linear relationship between X and Y
C.) -1 < Corr(X,Y) < 0
D.) none of the above - Answers - C
QUESTIONS WITH VERIFIED ANSWERS
A causal effect of X on Y is defined as:
A) a non-zero correlation between X and Y
B.) a positive relationship between X and Y
C.) either positive, negative or non-linear relationship between X and Y
D.) either a positive, negative or non-linear relationship between X and Y when all other
variables that affect Y are held constant - Answers - D
Correlation between X and Y can only be interpreted as a causal relationship of X and Y
if:
A.) Y is unaffected by X in a linear way
B.) Y is an affected by any variable other than X
C.) Y is unaffected by any variable that is correlated with X
D.) Both A and C - Answers - D
If the variance of grades in this course is 16, each student should (unconditionally)
expect their grade to deviate from the class average by:
A.) 32 points
B.) 16 points
C.) 8 points
D.) 4 points - Answers - D
The variance of a random variable Y:
A.) is always less than the variance of the simple mean
B.) is always greater than the variance of the same mean
C.) is equal to the variance of the same mean when the sample size is 1
D.) none of the above - Answers - C
As the sample size increases, the variance of the sample mean
A.) increases
B.) decreases
C.) stays constant
D.) not enough info to know - Answers - B
A negative covariant between X and Y implies that
A.) as X increases, Y increases
B.) there is no linear relationship between X and Y
C.) -1 < Corr(X,Y) < 0
D.) none of the above - Answers - C
