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Regression analysis is based on the assumption that the dependent variable is distributed according some function of the independent variables together with independent identically distributed random errors. If the error terms were not stochastic then some of the properties of the regression analysis are not valid.

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โˆ™ 2015-11-15 12:29:34
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A polynomial of degree zero is a constant term

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Q: What is the role of the stochastic error term in regression analysis?
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