Which of the following is not a problem associated with multicollinearity?
A) It becomes difficult to compute the correct test statistic.
B) It becomes difficult to assess the relative importance of the independent variables in explaining the variation in the dependent variables.
C) The partial regression coefficients may not be estimated precisely.The standard errors are likely to be high.
D) Predictor variables may be incorrectly included or removed in stepwise regression.

Question

Quizplus · Accepted Answer

Multicollinearity does not affect the computation of the test statistic itself, but it does affect the precision of the estimated coefficients and the interpretation of the model.

Which of the Following Is Not a Problem Associated with Multicollinearity