Question: Examining the formula for the sampling variance of A in simple regression, VA 2 Px2 i n Pxi ' x 2 why is

Examining the formula for the sampling variance of A in simple regression, VðAÞ ¼ σ2

ε

Px2 i

n Pðxi ' xÞ

2 why is it intuitively sensible that the variance of A is large when the mean of the xs is far from 0? Illustrate your explanation with a graph.

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