Android "Not_Market_Managed" error

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Working on trying out the market licensing service, and I'm running into a few problems with the sample application.

When I first ran the sample, I got an error saying that the application was not licensed. I linked my account to the simulator in order to get it to get the test response, and now I get an error saying "Application error: NOT_MARKET_MANAGED"

Does this mean that I have to upload the app to the market in order to test to see if it works?

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