15. SLR.5 and variance of the OLS slope parameter Suppose the simple ous near re

Question

15. SLR.5 and variance of the OLS slope parameter Suppose the simple ous near regression model is given as: y +8 u Although impossible in reality, suppose you know that Var(ulx)- 5. What does this mean? O The error term exhibits heteroskedasticity, and the OLS estimates will be unbiased. O The error term exhibits homoskedasticity, but you cannot determine if the OLS estimates will be unbiased. O The error term exhibits homoskedasticity, and the OLS estimates will be biased. O The error term exhibits heteroskedasticity, and the OLS estimates will be biased asticity, and the OLS estimates will be biased. Given that the assumptions SLR. 1 through SLR.4 hold, and the error term exhibits homoskedasticity with Varulx)02, which of the following represent the variance of ? Check all that apply. (xi-x) o2 SSTx The following graph shows two hypothetical samples of data points (x,y) for your regression model.

Explanation / Answer

If the var(errors) = 5 it means it is having heteroskedasticity in the model and ols estimates are biased

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