A Microeconomist Wants to Determine How Corporate Sales Are Influenced

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 records 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