In Simple Linear Regression, the Plot of Residuals Versus Fitted

question 40

Multiple Choice

In simple linear regression, the plot of residuals versus fitted values 3 can be used to check for:

• A) normality
• B) a constant variance independent of x
• C) independence
• D) all of these
• E) none of these

---

Definitions:

Present Value

The current value of a future sum of money or stream of cash flows given a specified rate of return.

Interest Rate

The proportion of a loan that is charged as interest to the borrower, typically expressed as an annual percentage of the loan's balance.

Loan Agreement

A formal contract between a borrower and a lender outlining the terms and conditions of the loan, including interest rates and repayment schedule.