Gauss-Markov assumptions Flashcards
1
Q
What is the ZCM assumption?
A
E(U|X) = E(U) = 0
2
Q
What is the form of the parameters?
A
They are linear with an additive term
3
Q
How is the sample obtained?
A
The sample is random, meaning x and y are independent and identically distributed
4
Q
Does the sample vary?
A
Yes, the x’s are not all the same value
5
Q
What is homoskedasticity?
A
Var(u|x) = Var^2 (the variance of u, conditional on x, is constant)
