When There Is Positive Autocorrelation, Over Time, Negative Error Terms

question 104

True/False

When there is positive autocorrelation, over time, negative error terms are followed by positive error terms and positive error terms are followed by negative error terms.

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Definitions:

Price Taker

A seller (or buyer) that is unable to affect the price at which a product or resource sells by changing the amount it sells (or buys).

Monopolistic Competitor

A firm in a market where many competitors sell products that are differentiated from one another and hence are not perfect substitutes.

Pure Competitor

A market condition where many small firms sell identical products, and no single seller can influence the market price.

Marginal Resource Cost Curve

A graphical representation showing the change in total cost incurred by a firm when it utilizes an additional unit of an input or resource.