Understanding Homoscedasticity in Multiple Regression

Very Hard Multiple Regression Analysis Model Assumptions

A data analyst is assessing a multiple regression model used to predict the sales of a product based on advertising expenditures across three different channels: TV, radio, and digital. The analyst wants to ensure the model meets the necessary assumptions for reliable inference. One of the critical assumptions of multiple regression analysis is the homoscedasticity of the residuals.

Given the following statements about homoscedasticity in regression analysis, identify which of the following statements is true:

Homoscedasticity requires that the residuals have a constant variance across all levels of the independent variable.

Homoscedasticity implies that the residuals are normally distributed regardless of the independent variables.

Homoscedasticity can be assessed using the Durbin-Watson statistic.

Hint

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