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Probelm:
(a) Differentiate between homoscedasticity and heteroscedasticity.
(b) Outline the reasons why the variances of disturbance term may vary.
(c) Given the 3 observations (1,4) , (2,6) and (3,7), with the true model being
Y = β1 + β2 X + u, solve the fitted line.
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(a) Explain what is meant by the term regression. (b) Describe the justification for the inclusion of a disturbance term in a regression analysis. (c) With appropriate exa
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