9 2. (A) Conaider a product inarket with a supply function Qui b0 +bIPi+ usi, and a demand function Qdi - 0 + blPi + udi, and a market equilibnum condition Qsi-Qdi, wbere usi and udi are mutually independent i.i.d. random variables, both with a mean of zero. a. Show that Pi and udi are correlated. b. Show that the OLS estimator of bl is inconsistent. c. How would you estimate b0, b1, and g0?

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