In general,the use of multiple independent variables increases the proportion of the variation in the dependent variable explained by the cost equation.

Question

Quizplus · Accepted Answer

This is a basic principal.The adjusted R-squared (R²)is the correlation coefficient squared and adjusted for the number of independent variables used to make the estimate.This adjustment to R² recognizes that as the number of independent variables increases,R² (unadjusted)increases.

In General,the Use of Multiple Independent Variables Increases the Proportion