The Least Squares Method Requires That the Variance $\sigma _ { \varepsilon } ^ { 2 }$

question 76

Multiple Choice

The least squares method requires that the variance $\sigma _ { \varepsilon } ^ { 2 }$ of the error variable ? is a constant no matter what the value of x is. When this requirement is violated, the condition is called:

• A)multicollinearity.
• B)heteroscedasticity.
• C)homoscedasticity.
• D)autocorrelation.

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