A multiple regression model with two explanatory variables is estimated using 20 observations resulting in SSE = 550 and SST = 1000. The value of adjusted R² is the closest to ________. A) 0.39 B) 0.45 C) 0.55 D) 0.61

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Quizplus · Accepted Answer

Adjusted R² is calculated using the formula: 1 - [(SSE/(n-k-1)) / (SST/(n-1))], where n is the number of observations and k is the number of explanatory variables. Here, n=20, k=2, SSE=550, SST=1000. Plugging in these values gives an adjusted R² closest to 0.39.

A Multiple Regression Model with Two Explanatory Variables Is Estimated