Question

Consider the following times-series where the data is recorded weekly

Data collected over 36 weeks

t	X	t	X	t	X	t	X	t	X	t	X
1	9.8	7	36.4	13	53.4	19	99.2	25	105.3	31	141.3
2	9.0	8	51.0	14	66.6	20	90.4	26	116.7	32	151.8
3	10.5	9	51.1	15	70.6	21	91.2	27	113.2	33	151.1
4	20.6	10	46.9	16	76.4	22	94.9	28	120.5	34	156.4
5	28.1	11	50.5	17	88.4	23	94.2	29	124.2	35	155.9
6	28.3	12	58.5	18	98.6	24	104.1	30	130.2	36	160.0

Assess the level of heteroskedasticity. Is there a reason for concern? Justify your answer.

Answer 1

We have used MINITAB software to plot the data

the residual vs plot is

by the plot we can see that the residuals are not evenly distributed,

in first part , residuals are negative mostly, in second part, residual is positive , and again in third part residuals are negative.

hence we can see that there is reccursive pattern of the residual so that it causes heteroskedasticity.