In determining the causal effect of Price on Sales, if advertising spend is a good control variable, how will the correlation of the error terms from the regression, Salesi = ?0 + ?1Pricei + Ui, and Salesi = ?0 + ?1Pricei + ?2Advertisingi + Vi and price be related?
A. Cor(Ui, Pricei) ? 0, Cor(Pricei, Vi) = 0
B. Cor(Ui, Vi) = 0
C. Cor(Ui, Pricei) = 0, Cor(Pricei, Vi) ? 0
D. Cor(Ui, Pricei) = 0, Cor(Pricei, Vi) = 0
Answer: A
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