
Ultimate access to all questions.
Which of the following statements about the ordinary least squares regression model (or simple regression model) with one independent variable are correct?
I. In the ordinary least squares (OLS) model, the random error term is assumed to have zero mean and constant variance.
II. In the OLS model, the variance of the independent variable is assumed to be positively correlated with the variance of the error term.
III. In the OLS model, it is assumed that the correlation between the dependent variable and the random error term is zero.
IV. In the OLS model, the variance of the residuals is assumed to be constant.