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1. If OLS estimators satisfy asymptotic normality, it implies that a. they are approximately normally distributed in large en

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Solution:

Asymptotic normality means that if more and more probability distributions are drawn from the data, they converge to a normal distribution. Also, it means that as more and more sample is included (as sample size increases), the distribution of a data converges to that of a normal distribution.

Further, since increased and large sample size involved, (b) cannot be correct, hence eliminated.

We are talking about normal distribution and not standard normal distribution such that mean be constant at 0 and variance be sigma squared, hence option (c) eliminated.

Option (d) is not a feature of any distribution in general, thus easily eliminated.

Thus, from all above we can conclude that the correct option is (a) OLS estimators are approximately normally distributed in large enough sample sizes, if they satisfy asymptotic normality.

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