Which of the following assumptions concerning the probability distribution of the random error
Term is stated incorrectly?
A) The distribution is normal.
B) The mean of the distribution is 0.
C) The variance of the distribution increases as X increases.
D) The errors are independent.

Question

Quizplus · Accepted Answer

The incorrect assumption is that the variance of the distribution increases as X increases. In a standard linear regression model, it is assumed that the variance of the errors is constant across all levels of X (homoscedasticity), not increasing (heteroscedasticity).

Which of the Following Assumptions Concerning the Probability Distribution of the Random