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Is the model heteroscedastic? Check the KB results to determine your answer.
A. No the residuals do not indicate heteroscedasticity since the KB test coefficient is significant.
B. Yes, the residuals indicate heteroscedasticity since the KB coefficient is not significant.
C. Yes, the residuals indicate heteroscedasticity since the KB test coefficient is significant.
D. No the model is not heteroscedastic since the KB coefficient is not significant.
Briefly define each of the following terms or phrases and briefly explain why it matters for tax policy.
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