Question
Regression analysis was performed on Demographics data using unemployment rate as the dependent variable and cost of living index as the independent variable. Compute and
Regression analysis was performed on Demographics data using unemployment rate as the dependent variable and cost of living index as the independent variable. Compute and analyze the residuals to determine if the assumptions underlying the regression analysis are valid. In addition, use the standard residuals to determine if any possible outliers exist.
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Part 1
Determine if the assumptions underlying the regression analysis are valid.
Linearity
be assumed.
The data
are not
are
linear.
Normality of errors
can
cannot
be assumed.
The histogram of the standard residuals
roughly bell-shaped.
Homoscedasticity
cannot
can
be assumed.
The variation about the regression line
is not
is
constant for all values of the independent variable.
Independence of errors
can
cannot
be assumed.
The residuals
are not
are
independent for each value of the independent variable.
Therefore, the assumptions
are not
are
valid.
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