For simple linear regression, y = β0 + β1x + u, which one of the following statements is true?
a. u is called the "error term". it is the error we make in prediction and b. u is called disturbance and it can be observed. c. u includes everything that affects y other than x. d. x is called the independent variable because x is independent from y and u.

Option a) u is called the "error term". It is the error we make in prediction

Option d) x is called the independent variable because x is independent from y and u.

Step-by-step explanation:

We are given the following information in the question:

where y is the dependent variable, x is the independent variable.

: It is the value of y when x is zero, that is y-intercept.

: It is the coefficient of x in predicting the dependent variable y.

u is the error term.

Thus, Option A) u is the error term and Option D)  x is called the independent variable because x is independent from y and u are the correct answer.

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step-by-step explanation: