The lack of a pattern in the error term plot that is distributed around (0,0) indicates that the net effect of all variables excluded from the model on the dependent variable is zero.

Question

Quizplus · Accepted Answer

The lack of a pattern in the error term plot around (0,0) suggests that the model's assumptions are being upheld and that no systematic errors or patterns remain in the residuals. It does not imply that the net effect of all excluded variables on the dependent variable is zero.

The Lack of a Pattern in the Error Term Plot