3.1.1.0 INTRODUCTION The general aim of this module is to provide you with a thorough understanding of the violation of one of the classical assumptions, equal variances (homoscedastic). The properties of the estimators of the regression coefficients depend on the properties of the disturbance term in the regression model. In this module, we shall be looking at some of the problems that arise when violations of the Gauss–Markov conditions, the assumptions relating to the disturbance term, are not satisfied. Basic understanding of heteroscedasticity (unequal-variances) will be likewise explained.
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