The OLS residuals in the multiple regression model
A)cannot be calculated because there is more than one explanatory variable.
B)can be calculated by subtracting the fitted values from the actual values.
C)are zero because the predicted values are another name for forecasted values.
D)are typically the same as the population regression function errors.

Question

Quizplus · Accepted Answer

OLS residuals are calculated by subtracting the predicted (fitted) values from the actual values. This is done separately for each observation in the sample. The residuals represent the part of the variation in the dependent variable that is not explained by the independent variables in the model.

The OLS Residuals in the Multiple Regression Model