Help, guys.
This is the data:
The question is: Identify the type of error and its impacts on regression Model A indicated by the data
Options are:
A.Serial correlation, invalid coefficient estimates, and deflated standard errors.
B.Heteroskedasticity, valid coefficient estimates, and deflated standard errors.
C.Serial correlation, valid coefficient estimates, and inflated standard errors.
The answer is A.
I understand why it is serial correlation and why standard errors are deflated (because the standard deviation of the coefficient estimates across samples gets smaller).
But why are coefficient estimates invalid (I presume “invalid” means “biased” - i.e., estimates from samples are not equal to the population value)?