An academic advisor wants to predict the typical starting salary of a graduate at a top business school using the GMAT score of the school as a predictor variable. A simple linear regression of
SALARY versus GMAT was created from a set of 25 data points.
Which of the following is not an assumption required for the simple linear regression analysis to
Be valid?
A)The errors of predicting SALARY are normally distributed.
B)SALARY is independent of GMAT.
C)The errors of predicting SALARY have a mean of 0.
D)The errors of predicting SALARY have a variance that is constant for any given value of GMAT.

Question

Quizplus · Accepted Answer

For simple linear regression to be valid, it assumes that the residuals (errors) are normally distributed (A), have a mean of 0 (C), and have constant variance (homoscedasticity) (D). However, it does not assume that the dependent variable (SALARY) is independent of the independent variable (GMAT); rather, it investigates the relationship between them.

An Academic Advisor Wants to Predict the Typical Starting Salary