Assume that x is random and the leverage hi values differ


Question: Assume that X is random and the leverage (hi) values differ considerably. It is known from analysis of past data that Var(?i) is essentially constant over the range of the Xi in the sample, yet a plot of the (raw) residuals against X shows considerable evidence of heteroscedasticity. Explain how this can happen. How would you advise an experimenter who uses this form of a residual plot?

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Management Theories: Assume that x is random and the leverage hi values differ
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