STATISTICAL SOFTWARE NEEDED, (R, Stata etc) The scatterplot below shows the regression of annual sales of hospital supplies versus the number of sales representatives who work for an equipment manufacturer.

Each point shows sales (in thousands of dollars) in 37 territories; territories are distinct regions located around the United States. This manufacturer puts more representatives in districts with more sales leads, so the number of representatives varies from territory to territory.

a. What is heteroscedasticity? Explain why we should expect to find heteroscedasticity in this regression. b. What additional plot would be most useful to check for heteroscedasticity?

Sales ($000) 16000 14000 12000 10000 8000 6000 4000 2000 0 0 5 10 15 20 25 Number of Sales Reps 30 30 35 Estimated Sales ($000) = -3.97 + 363.5Number Reps R2 = 0.513, SE = 2930