1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
Semmy [17]
3 years ago
11

Which of the following is true about multicollinearity?

Business
1 answer:
Komok [63]3 years ago
3 0

Answer:

d. It is best measured using the statistic variance inflation factor (VIF).

Explanation:

Multicollinearity is an important issue in multiple regression model, having many independent/ explanatory variables. Multicollinearity is the situation in which two or more independent variables are highly correlated. It is problematic because it increases the standard error of independent variable coefficient & undermines its statistical significance

Variance Inflation Factor [VIF] is a check & corrective measure of multicollinearity.  

  • VIF as a multicollinearity check : It quantifies the correlation between one explanatory variable with other explanatory variables.VIF = 1 implies there is no multicollinearity (correlation between independent variables); VIF upto 5  implies there is moderate multicollinearity (correlation between independent variables). VIF > 5 implies high multicollinearity (correlation between independent variables)
  • VIF as a multicollinearity correction : Calculating  Var (\beta j ) = σ^2 / [TSS j (1 - R^2j)] ; where TSS = total sum of square of variable j , σ^2 =  j variance, R^2 j = R^2 from regressing all other independent variable on variable j
You might be interested in
Nonprofit organizations differ from profit organizations in that nonprofit organizations: Group of answer choices
Schach [20]

Answer:

The correct answer is <em>must often target those who are apathetic about or strongly opposed to receiving their services. </em>

Explanation:

A nonprofit organization is formed for the public good. Nonprofit organizations are usually formed for religious, charitable or educational purposes.

Instead, for-profit organizations can be formed to carry out a variety of legal businesses. The main reason for forming a profit organization is to make profits for the owners of the company.

8 0
3 years ago
Which term refers to the interest the Federal Reserve Bank (Fed) charges banks for loans? open‑market sale fractional banking re
balu736 [363]

Answer:

Which term refers to the interest the Federal Reserve Bank (Fed) charges banks for loans?

  • discount rate

the discount rate is the interest rate that the Federal Reserve System charges banks for the loans it makes. The overnight rate or the federal funds rate is even lower, but it lasts a few hours only.

Select the charge the Fed levies on banks borrowing funds that would result in the smallest increase in the money supply.

  • two percentage points above the private level

the higher the interest rate, the lower the increase in the money supply.

3 0
3 years ago
When firms expand into global markets, they are faced with the choice of reducing costs and/or adapting to the local market. Whe
lorasvet [3.4K]
Global strategy & transnational strategy
5 0
3 years ago
Assume personal tax rates are lower than corporate tax rates. From a tax-paying shareholder point of view, how should a firm spe
ASHA 777 [7]

Answer: e. repurchase shares

Explanation:

If the personal tax rates are lower than corporate tax rates then the company should engage in an activity that would put money into the pockets of shareholders such that they would take advantage of the lower personal tax rates.

The best way to do that would be a share repurchase. The company would probably buy at above market rates which would give shareholders capital gain and they wouldn't have to pay much taxes on it as personal rates are lower.

4 0
3 years ago
Assume an analyst has been hired to estimate the price elasticity of demand for hamburger (which sells for about $2.30 per pound
Pepsi [2]

Answer:

The correct answer is B

Explanation:

Price elasticity of the demand evaluates the demand responsiveness after the change or variation in the product own price.

The formula for computing the coefficient of price elasticity, is the factors which affect the elasticity and also elasticity is vital for business when deciding the prices.

So, Filet mignon(F) sells for $20 per pound when compared to that of hamburger (H) which sells the product for $2.30 per pound. F have the higher price as compare to the H, therefore, the coefficient of the price elasticity of demand in absolute value will be high or larger for F than that of H.

6 0
3 years ago
Other questions:
  • Why might one project have the highest pw while a different project has the largest irr? explain?
    15·1 answer
  • Roshannon Corporation uses activity-based costing to compute product margins. In the first stage, the activity-based costing sys
    7·1 answer
  • Last year the price of corn was $3 a bushel and the quantity of corn demanded was 10 million bushels. this year the price of cor
    8·1 answer
  • A key element of customer relationship management is to: keep the price of goods as low as possible. develop a strategy to achie
    5·2 answers
  • As Timothy examines markets that might match his company’s investment requirements, he is particularly interested in the fact th
    6·1 answer
  • Riverbed Corporation had the following activities in 2020. 1. Sale of land $186,000 4. Purchase of equipment $428,000 2. Purchas
    13·1 answer
  • On December 31, Cruise Company has 18,000 units of an inventory item, which cost $46 per unit when purchased on June 15. The sel
    9·1 answer
  • Please tell whether inventory is beneficial or not for businesses with a large number of customers? Why?
    9·2 answers
  • Your store has an average time of 90 seconds toprocess a sales transaction. There are three customers in line to check
    5·2 answers
  • what challenges might people living in a county or state with a high concentration of subprime scores be facing as a result of t
    9·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!