The variance of the error variable, $\sigma _ { \varepsilon } ^ { 2 }$ , is required to be constant. When this requirement is violated, the condition is called heteroscedasticity.

Question

Quizplus · Accepted Answer

Heteroscedasticity occurs when the variance of the error terms in a regression model is not constant across observations, violating the assumption of constant variance ($\sigma _ { \varepsilon } ^ { 2 }$).

The Variance of the Error Variable σε2\sigma _ { \varepsilon } ^ { 2 }σε2​

The Variance of the Error Variable $\sigma _ { \varepsilon } ^ { 2 }$