Final Exam (Latest 2024 / 2025 )

Which of the following statements is true about interactions? 1.Interpreting interactions is always very straightforward 2.Interaction is the same as multicollinearity 3.Interactions exist when X variables affect each other's influence on Y 4.Interactions are correlations among X variables {Ans: Interactions exist when X variables affect each other's influence on Y}Which of the following statements is NOT true? 1.The size of the errors indicate how "good" the line is as a model 2.We can say that we have a good model when we have small relative errors 3.Higher correlations between X and Y generally produce smaller relative errors 4.We can always get a perfect prediction if we try harder {Ans: we can always get a perfect prediction if we try harder}Which of the following statements is true about multicollinearity? 1.Multicollinearity is a strong correlation between predictor variables (X) and the dependent variable (Y) in a model 2.Perfect multicollinearity means two variables have a correlation of 0 3.Two variables are considered independent if their correlation is 1 4.Multicollinearity is a strong correlation between predictors (X variables) in a model {Ans: Multicollinearity is a strong correlation between predictors (X variables) in a model}which of the following is true about creating