In regression analysis,the existence of a high degree of intercorrelation among some or all of the explanatory variables in the regression equation constitutes:
A)autocorrelation
B)a simultaneous equation relationship
C)nonlinearities
D)heteroscedasticity
E)multicollinearity

Question

Quizplus · Accepted Answer

Multicollinearity is the existence of a high degree of intercorrelation among some or all of the explanatory variables in the regression equation. This can lead to unstable and imprecise estimates of the regression coefficients and a lower overall predictive power of the model.

In Regression Analysis,the Existence of a High Degree of Intercorrelation