Data were collected for a study investigating what factors affect the size of company bonuses.The number of employees at the company and whether or not the employees were unionized (1 = yes, 0 = no) was included in two competing multiple regression models.Which of the following statements is true?

A)Model 2 explains less of the variability in average annual bonus than model 1.
B)The standard deviation of residuals is lower for model 1 compared to model 2.
C)Model 1 includes an interaction term.
D)Model 2 is better than model 1.
E)Model 1 is better than model 2.

Question

Data were collected for a study investigating what factors affect the size of company bonuses.The number of employees at the company and whether or not the employees were unionized (1 = yes, 0 = no) was included in two competing multiple regression models.Which of the following statements is true?

A)Model 2 explains less of the variability in average annual bonus than model 1. 
B)The standard deviation of residuals is lower for model 1 compared to model 2. 
C)Model 1 includes an interaction term. 
D)Model 2 is better than model 1. 
E)Model 1 is better than model 2.

Quizplus · Accepted Answer

The Answer is D

Data Were Collected for a Study Investigating What Factors Affect