One of the Standard Assumptions of the Linear Regression Model

question 150

True/False

One of the standard assumptions of the linear regression model is that the variance of the error terms is equal to one.

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Definitions:

SST

Total sum of squares in statistical analysis, measuring the total variation in the observed data.

Least Squares Estimate

A method in statistics for estimating the best-fitting line through a set of points by minimizing the sum of the squares of the differences between observed and estimated values.

Y-intercept

The point where a line crosses the Y-axis of a graph, representing the value of the dependent variable when all independent variables are set to zero.

Critical Value Approach

A method in hypothesis testing that involves comparing the test statistic to pre-determined values to decide whether to reject the null hypothesis.