A useful technique in controlling multicollinearity involves the _________.
A) use of variance inflation factors
B) use the backward elimination procedure
C) use the forward elimination procedure
D) use the forward selection procedure
E) use all possible regressions

Question

Quizplus · Accepted Answer

The use of variance inflation factors (VIFs) can help to identify and measure the extent of multicollinearity in a regression model. VIFs provide a measure of how much the variance of the estimated regression coefficient is inflated due to the presence of collinearity in the data. A high VIF indicates strong multicollinearity, which can be problematic for the interpretation of the regression coefficients and the accuracy of the model predictions. By identifying the variables with high VIFs, it is possible to address multicollinearity by re-specifying the model, removing or combining highly correlated variables, or using alternative estimation techniques.

A Useful Technique in Controlling Multicollinearity Involves the _________