One of the assumptions required by the regression model is that the residuals (errors)be independent of each other.When this assumption is not met:
A) multicollinearity exists.
B) heteroscedasticity exists.
C) homoscedasticity exists.
D) serial correlation exists.
E) a normal distribution exists.

Question

Quizplus · Accepted Answer

When the residuals are not independent, it means that there is a pattern or correlation between them. This is known as serial correlation or autocorrelation. It violates the independence assumption and can lead to biased and inefficient estimates of the regression coefficients. Options A, B, C, and E refer to other assumptions in the regression model, but do not specifically address the issue of independence of residuals.

One of the Assumptions Required by the Regression Model Is