28) Which of the following predictions cannot be described by a binary choice model?

A) Predict the ability to swim through the English Channel.

B) Predict the chances of a candidate winning the next presidential election.

C) Predict today's number of cars crossing the Golden Gate Bridge.

D) Predict the occurrence of a hurricane in Florida next year.

29.) For the linear probability model y = β0 + β1x + ε, the predicted value of y is always constrained to be ________.

A) between 0 and 1.

B) positive.

C) negative.

D) between minus infinity to infinity.

Solutions

Expert Solution

28) Answer: C) Predict today's number of cars crossing the Golden Gate Bridge.

Explanation: In Binary choice model the response (dependent) variable is categorical (Binary). In Predict today's number of cars crossing the Golden Gate Bridge the response variable is continuous (numerical). Hence predict today's number of cars crossing the Golden Gate Bridge cannot be described by a binary choice model.

29) Answer: A) between 0 and 1

Explanation: The linear probability model predicts the probability of occurrence of particular event and thus the predicted value (probability) of y is always constrained to be between 0 and 1.

orchestra answered 1 year ago

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