A simple linear regression, y = ? 0 + ? 1 x + ?, is estimated with

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A simple linear regression, y = ?₀ + ?₁x + ?, is estimated with cross-sectional data. The resulting residuals e along with the values of the explanatory variable x are shown in the accompanying table.

a. Graph the residuals e against the values of the explanatory variable x and look for any discernible pattern.

b. Which assumption is being violated? Discuss its consequences and suggest a possible remedy.

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Essentials Of Business Statistics Communicating With Numbers

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A simple linear regression, y = ? 0 + ? 1 x + ?, is estimated with

Question:

11 4. 10 8. х 4 14 -6 -6 - 16 -11 -1 -1

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a b Since the residual plot exhibits nonlinear patterns the ...View the full answer

Essentials Of Business Statistics Communicating With Numbers

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