Workshop on Introduction to Eviews

1. Dealing with heteroscedasticity
Click Quick and select Estimate Equation. A dialog box will appear as below:-
Type dependent variable (gdp) followed by constant (c) and independent variables (invest and unemp)
in the space provided.
Click ok and the results will be as below:-

2. Click View and select Actual, Fitted Residual and direct to Residual Graph
The illustration of residual graph will be as below:-(Actual GDP-Predicted GDP)

3. Create a new series, residual3 that can capture the values of residuals
Genr residual3=resid
Click Quick and select Graph. A dialog box will appear as below:
Type gdp followed by residuals3 in the provided space
Click ok .A dialog box will appear as below:
Select Scatter in the specific box and choose Regression Line as a type of Fit Line, and then click ok.

4. The illustration of scatter plot will be shown as below:-
Click View and select Residual Tests, and then direct to Heteroskedasticity Tests.
A dialog box on Heteroskedasticity Tests will appear as below:-

5. Select Breusch-Pagan Godfrey.Click ok and the results will be as below:-
Null hypothesis : There is no heteroscedasticity (Homoscedasticity)
Alternative hypothesis: There is a heteroscedasticity
p-value=0.0020, p-value<0.05, Existence of heteroscedasticity
Click View and select Residual Tests, and then direct to Heteroskedasticity Tests.
A dialog box on Heteroskedasticity Tests will appear

6. Select White. Click Ok and the results will be as below:-
Null hypothesis : There is no heteroscedasticity (Homoscedasticity)
Alternative hypothesis: There is a heteroscedasticity
p-value=0.00, p-value<0.05, Existence of heteroscedasticity