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Basic Question 0 of 5
Each variable included in a regression should play an essential role. This is equivalent to saying:
B. The model should be grounded in cogent economic reasoning.
C. The model cannot violate any regression assumptions.
A. The model should be parsimonious.
B. The model should be grounded in cogent economic reasoning.
C. The model cannot violate any regression assumptions.
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Learning Outcome Statements
describe how model misspecification affects the results of a regression analysis and how to avoid common forms of misspecification;
CFA® 2025 Level II Curriculum, Volume 1, Module 3.