This table contains accounting and financial data that describe 324 companies operating in the information sector in
Question:
(a) What problem with the use of the SRM is evident in the scatterplot of y on x as well as in the plot of the residuals from the fitted equation on x?
(b) If the residuals are nearly normal, of the values that lie outside the 95% prediction intervals, what proportion should be above the fitted equation?
(c) Based on the property of residuals identified in part (b), can you anticipate that these residuals are not nearly normal—without needing the normal quantile plot?
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Related Book For
Statistics For Business Decision Making And Analysis
ISBN: 9780321890269
2nd Edition
Authors: Robert Stine, Dean Foster
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