When all the coefficient student t statistics are small,indicating no individual effect,and yet the overall F statistic indicates a strong effect for the total regression model,the model is said to be affected by:
A)heteroscedasticity.
B)homoscedasticity.
C)multicollinearity.
D)sampling error.

Question

Quizplus · Accepted Answer

When all the coefficient student t statistics are small, it suggests that there is no significant individual effect. However, when the overall F statistic indicates a strong effect for the total regression model, it suggests the presence of multicollinearity. This means that the independent variables are highly correlated with each other, making it difficult to determine the individual effect of each variable on the dependent variable. Hence, the correct answer is choice C, multicollinearity. The other options, such as heteroscedasticity, homoscedasticity, and sampling error, do not seem to explain the situation adequately.

When All the Coefficient Student T Statistics Are Small,indicating No