In the Equation , C Denotes Consumption and I

question 4

Multiple Choice

In the equation , c denotes consumption and i denotes income. What is the residual for the 5^th observation if =$500 and =$475?

• A)$975
• B)$300
• C) $25
• D) $50

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Definitions:

Regression Toward

A statistical phenomenon where extreme values in data are likely to be followed by, or associated with, less extreme values.

Pretest

An initial measurement or evaluation performed before an intervention or experiment to establish a baseline.

Posttest

A test given after a particular intervention or period of instruction to measure its effectiveness or outcomes.

Construct Validity

The extent to which a test or instrument measures the theoretical construct it is intended to measure.