A sports manufacturer performs a customer satisfaction survey, and would like to reduce the scale items into a smaller number of factors. What does the following output suggest?

A) The sample size is sufficient, but there is multicollinearity in the data.
B) The sample size is inadequate, and there is multicollinearity in the data.
C) The sample size is adequate, and the correlations in the correlation matrix are significantly bigger than zero.
D) The sample size is adequate, but the correlations in the correlation matrix are not big enough.

Question

A sports manufacturer performs a customer satisfaction survey, and would like to reduce the scale items into a smaller number of factors. What does the following output suggest?

A) The sample size is sufficient, but there is multicollinearity in the data. 
B) The sample size is inadequate, and there is multicollinearity in the data. 
C) The sample size is adequate, and the correlations in the correlation matrix are significantly bigger than zero. 
D) The sample size is adequate, but the correlations in the correlation matrix are not big enough.

Quizplus · Accepted Answer

The output suggests that the sample size is adequate and the correlations in the correlation matrix are significantly bigger than zero, indicating that there are underlying factors that explain the relationships among the scale items. This suggests that factor analysis can be used to reduce the number of factors and identify the underlying dimensions of customer satisfaction.

A Sports Manufacturer Performs a Customer Satisfaction Survey, and Would