If the assumption fails, then it is called heteroscedasticity. The assumption is for constant variance with respect to the magnitude of the independent variable called homoscedasticity. It is plausible that as income increases the variation around the amount purchased will also increase simply because of the flexibility provided with higher levels of income. Consider the relationship between personal income and the quantity of a good purchased as an example of a case where the variance is dependent upon the value of the independent variable, income. The meaning of this is that the variances of the independent variables are independent of the value of the variable.
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