A Microeconomist Wants to Determine How Corporate Sales Are Influenced

question 68

Multiple Choice

A microeconomist wants to determine how corporate sales are influenced by capital and wage spending by companies.She proceeds to randomly select 26 large corporations and record information in millions of dollars.A statistical analyst discovers that capital spending by corporations has a significant inverse relationship with wage spending.What should the microeconomist who developed this multiple regression model be particularly concerned with?

• A)Normality of residual.
• B)Randomness of error terms.
• C)Missing observations.
• D)Collinearity.

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Definitions:

Determining Abnormality

The process of identifying behaviors, thoughts, and feelings that are deviant from the societal norm, distressing to the individual, dysfunctional, or dangerous.

Psychoanalytic Theory

A comprehensive theory of human personality and behavior developed by Sigmund Freud, emphasizing unconscious motivations, conflicts, and past experiences.

Abnormal Psychology

The branch of psychology that studies unusual patterns of behavior, emotion, and thought, which may or may not be understood as precipitating a mental disorder.

Ancient Egyptian

Pertaining to the civilization of the Nile Valley from circa 3100 BCE to 30 BCE, known for its monumental architecture, hieroglyphic writing, and adherence to a polytheistic religion.