Consider the Following Simple Linear Regression Model: Y = β₀

question 20

Multiple Choice

Consider the following simple linear regression model: y = β₀ + β₁x +ε.The response variable is ____.

• A) y
• B) x
• C) ε
• D) β₀

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Definitions:

Consumer Surplus

The gap reflecting the difference between what consumers plan to pay for a good or service and what they pay in practice.

Surplus III

Excess of production or supply over demand in a market, leading to potential price reductions to clear the surplus stock.

Total Surplus

The sum of consumer surplus and producer surplus in a market, representing the total net benefit to society from trading a good or service.

Equilibrium Price

Equilibrium price is the market price where the quantity of goods supplied is equal to the quantity of goods demanded.