I am working on a linear Regression Model right now, it has the following format:
leisure = ß0 + ß1*age + ß2*log(rain +1) + ß3*log(temperature + 1) + ß4*km + ß5*time
So basically I want to know if rain and temperature has an impact on the number of leisure activities a person spends (leisure is a fractional number) I had to add a small constant when taking the log, because rain and temperature can take zero values. I plotted a Residual vs. Fitted Plot and I am wondering if I interpret it the right way. The red line is nearly horizontal which should indicate that there is a linear relationship between my independent variables and my dependent variable leisure. However the plot also shows me that I have a massiv problem with Heteroskedasticity. I thought about using FGLS to deal with my Heteroskedasticity. I am grateful for any suggestions and input. Thank you