Business Statistics

Chapter 15 | Multiple Regression Analysis 513

FIGURE 15.12

MS Excel plot for residuals

versus advertisement for

Example 15.1

15.5.2 Constant Error Variance (Homoscedasticity)

Figure 15.13 is the plot produced using Minitab exhibiting constant error variance for Example 15.1.

It can be seen from Figure 15.13 showing residuals versus fitted values that the residuals are scattered

randomly around zero. Hence, the errors have constant variance or the assumption of homoscedastic-

ity is not violated.

15.5.3 Independence of Error

Residuals versus time graph can be plotted (as shown in Figure 15.14) for checking the assump-

tion of independence. Figure ...