in the function Yi= ?1+?2Xi+ui, the term ui is ------- in nature
A)random
B)nonsystematic
C)all of the above
D)none of the above

Name: in the function Yi= ?1+?2Xi+ui, the term ui is ------- in nature A)random B)nonsystematic C)all of the above D)none of the above
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Question

Quizplus · Accepted Answer

The term $u_i$ in the function $Y_i = \beta_1 + \beta_2X_i + u_i$ represents the error term, which is both random and nonsystematic in nature. It accounts for the variation in $Y_i$ not explained by the independent variable $X_i$.

In the Function Yi= ?1+?2Xi+ui, the Term Ui Is -------