In Chapter 11, the regression of retail sales per household on disposable income per household was estimated by least squares. The data are given in Table 11.1, and Table 11.2 shows the residuals and the predicted values of the dependent variable. Use the data file Retail Sales.a. Graphically check for heteroscedasticity in the regression errors.b. Check for heteroscedasticity by using a formal test.Table 11.1 RETAIL STORE INCOME (X) RETAIL SALES (Y) RETAIL STORE INCOME (X) RETAIL SALES (Y) 1 $55,641 $21,886 12 $57,850 $22,301 2 $55,681 $21,934 13 $57,975 $22,518 3 $55,637 $21,699 14 $57,992 $22,580 4 $55,825 $21,901 15 $58,240 $22,618 5 $55,772 $21,812 16 $58,414 $22,890 6 $55,890 $21,714 17 $58,561 $23,112 7 $56,068 $21,932 18 $59,066 $23,315 8 $56,299 $22,086 19 $58,596 $22,865 9 $56,825 $22,265 20 $58,631 $22,788 10 $57,205 $22,551 21 $58,758 $22,949 11 $57,562 $22,736 22 $59,037 $23,149 Table 11.2 Retail Observed Predicted Retail Income Sales Predicted Deviation from Deviation from Store (X) (Y) Retail Sales Residual the Mean the Mean 1 55,641 21,886 21,787 99 -550 -649 2 55,681 21,934 21,803 131 -502 -633 3 55,637 21,699 21,786 -87 -737 -650 4 55,825 21,901 21,858 43 -535 -578 5 55,772 21,812 21,837 -25 -624 -599 6 55,890 21,714 21,882 -168 -722 -554 7 56,068 21,932 21,950 -18 -504 -486 8 56,299 22,086 22,039 48 -350 -398 9 56,825 22,265 22,239 26 -171 -197 10 57,205 22,551 22,384 167 115 -52 11 57,562 22,736 22,520 216 300 84 12 57,850 22,301 22,630 -329 -135 194 13 57,975 22,518 22,678 -160 82 242 14 57,992 22,580 22,684 -104 144 248 15 58,240 22,618 22,779 -161 182 343 16 58,414 22,890 22,845 45 454 409 17 58,561 23,112 22,902 211 676 465 18 59,066 23,315 23,094 221 879 658 19 58,596 22,865 22,915 -50 429 479 20 58,631 22,788 22,928 -140 352 492 21 58,758 22,949 22,977 -28 513 541 22 59,037 23,149 23,083 66 713 647 Sum of squared values 436,127 5,397,565 4,961,438

In Chapter 11, the regression of retail sales per household on disposable income per household was estimated by least squares. The data are given in Table 11.1, and Table 11.2 shows the residuals and...

In Chapter 11, the regression of retail sales per household on disposable income per household was estimated by least squares. The data are given in Table 11.1, and Table 11.2 shows the residuals and the predicted values of the dependent variable. Use the data file Retail Sales.

a. Graphically check for heteroscedasticity in the regression errors.

b. Check for heteroscedasticity by using a formal test.

Table 11.1

RETAIL STORE	INCOME (X)	RETAIL SALES (Y)	RETAIL STORE	INCOME (X)	RETAIL SALES (Y)
1	$55,641	$21,886	12	$57,850	$22,301
2	$55,681	$21,934	13	$57,975	$22,518
3	$55,637	$21,699	14	$57,992	$22,580
4	$55,825	$21,901	15	$58,240	$22,618
5	$55,772	$21,812	16	$58,414	$22,890
6	$55,890	$21,714	17	$58,561	$23,112
7	$56,068	$21,932	18	$59,066	$23,315
8	$56,299	$22,086	19	$58,596	$22,865
9	$56,825	$22,265	20	$58,631	$22,788
10	$57,205	$22,551	21	$58,758	$22,949
11	$57,562	$22,736	22	$59,037	$23,149

Table 11.2

		Retail		Observed	Predicted
Retail	Income	Sales Predicted		Deviation from	Deviation from
Store	(X)	(Y) Retail Sales	Residual	the Mean	the Mean
1	55,641	21,886 21,787	99	-550	-649
2	55,681	21,934 21,803	131	-502	-633
3	55,637	21,699 21,786	-87	-737	-650
4	55,825	21,901 21,858	43	-535	-578
5	55,772	21,812 21,837	-25	-624	-599
6	55,890	21,714 21,882	-168	-722	-554
7	56,068	21,932 21,950	-18	-504	-486
8	56,299	22,086 22,039	48	-350	-398
9	56,825	22,265 22,239	26	-171	-197
10	57,205	22,551 22,384	167	115	-52
11	57,562	22,736 22,520	216	300	84
12	57,850	22,301 22,630	-329	-135	194
13	57,975	22,518 22,678	-160	82	242
14	57,992	22,580 22,684	-104	144	248
15	58,240	22,618 22,779	-161	182	343
16	58,414	22,890 22,845	45	454	409
17	58,561	23,112 22,902	211	676	465
18	59,066	23,315 23,094	221	879	658
19	58,596	22,865 22,915	-50	429	479
20	58,631	22,788 22,928	-140	352	492
21	58,758	22,949 22,977	-28	513	541
22	59,037	23,149 23,083	66	713	647
		Sum of squared values	436,127	5,397,565	4,961,438

May 26, 2022

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In Chapter 11, the regression of retail sales per household on disposable income per household was estimated by least squares. The data are given in Table 11.1, and Table 11.2 shows the residuals and...

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