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Consider the regression function C, = 8, . I, + U,, where Cindicates the household's consumption level, and / indicates the household's income level. The
Consider the regression function C, = 8, . I, + U,, where Cindicates the household's consumption level, and / indicates the household's income level. The measurement error in the dependent variable C implies that . A. the independent variable /, is also subject to measurement errors, B. there will be simultaneous equations between Cand / C. the independent variable / will be endogenous. O) D. the error term might be heteroskedastic
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