It is dangerous to predict outside the range of the data collected in a regression analysis. For instance, we shouldnʹt predict the price of a 5000 square foot home if all our sample homes were
Smaller than 4500 square feet. Which of the following multiple regression pitfalls does this example
Describe?
A)Multicollinearity
B)Extrapolation
C)Estimability
D)Stepwise Regression

Question

Quizplus · Accepted Answer

Extrapolation refers to making predictions outside the range of the data. In this case, predicting the price of a home larger than any in the sample (5000 square feet when all sample homes are smaller than 4500 square feet) is an example of extrapolation, which can lead to inaccurate or unreliable predictions.

It Is Dangerous to Predict Outside the Range of the Data