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Double Exponential SmoothingGraphs - Normal Plot of the Residuals |
This graph plots the residuals versus their expected values when the distribution is normal. The residuals from the analysis should be normally distributed. In practice, for data with a large number of observations, moderate departures from normality do not seriously affect the results.
The normal probability plot of the residuals should roughly follow a straight line. Use this plot to look for the following:
This pattern... |
Indicates... |
Not a straight line |
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Curve in the tails |
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A point far away from the line |
An outlier |
Changing slope |
If your data have fewer than 50 observations, the plot may display curvature in the tails even if the residuals are normally distributed. As the number of observations decreases, the probability plot may show even greater variation and nonlinearity. Use the normal probability plot and goodness-of-fit tests to assess the normality of residuals in small data sets.
Example Output |
Interpretation |
For the sales data, the point on the bottom left corner of the plot indicates an outlier exists. Because the data only has 24 observations, you should conduct a normality test to determine whether the residuals are normally distributed.