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In: Statistics and Probability

A) Explain the Durbin Watson test. b) Give reasons why we introduce a stochastic disturbance term...

A) Explain the Durbin Watson test.
b) Give reasons why we introduce a stochastic disturbance term in a regression equation.
c) Explain how you can informally detect heteroscedasticity.
d) Explain the rationale for using the adjusted R square.
e) Why does the classical linear model assume that there is no multicollinearity among the explanatory variables?

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