For a confidence interval around b to be valid (or for a t-test to be valid) what assumptions must be true? List and explain.
What will be an ideal response?
Ans: For a confidence interval around b to be valid (or for a t-test to be valid) the following assumptions must be true.
• In the population, there is a linear relationship between the specific fixed values of x and E(y|x).,
• The conditional distributions of the bivariate distribution are homoscedastic.
• The conditional distributions are normal.
• There was random sampling.
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