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A Breusch–Pagan (BP) test is run on the residuals from two regression models to detect heteroskedasticity, with the following results:
| BP Test Statistic | P-Value |
|-------------------|---------|
| Model 1 | 5.458 | 0.0195 |
| Model 2 | 0.046 | 0.8302 |
If the level of significance is 5%, which of the following is the most appropriate conclusion that can be drawn?
A
Model 1 has homoskedastic residuals
B
White's correction should be applied to Model 1
C
The t-statistics for Model 2 cannot be relied upon