E(ui Xi) = 0 says that
A) dividing the error by the explanatory variable results in a zero (on average).
B) the sample regression function residuals are unrelated to the explanatory variable.
C) the sample mean of the Xs is much larger than the sample mean of the errors.
D) the conditional distribution of the error given the explanatory variable has a zero mean.
Answer: D) the conditional distribution of the error given the explanatory variable has a zero mean.
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The aggregate demand curve illustrates that, as the price level rises
A) the quantity of real GDP demanded increases. B) the quantity of real GDP demanded decreases. C) the AD curve shifts rightward. D) the AD curve shifts leftward.
An imperfectly competitive firm has the following total cost curve: C = 100 + 4Q. What is marginal cost equal to when Q = 10?
What will be an ideal response?