Below you will find a scatterplot of data gathered by an online retail company. The company has been able to obtain the annual salaries of their customers and the amount that each of these customers spent on the company's site last year. Based on the scatterplot below, would you conclude that these data meet all four assumptions of regression? Explain your answer.
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What will be an ideal response?


The assumption that the variation of the Y's about the regression line is the same regardless of the value of the X's (homoscedasticity) seems to be violated. The fan shape pattern in the graph seems to exhibit what can be describes as heteroscedasticity or nonconstant error variance.

Business

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