SME_8e_Ch_17_Section_3 - CHAPTER 17 SECTION 3 MULTIPLE...

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1 CHAPTER 17 SECTION 3: MULTIPLE REGRESSION MULTIPLE CHOICE 111. Which of the following statements regarding multicollinearity is not true? a. It exists in virtually all multiple regression models. b. It is also called collinearity and intercorrelation. c. It is a condition that exists when the independent variables are highly correlated with the dependent variable. d. All of these choices are true. ANS: C PTS: 1 REF: SECTION 17.3 112. When the independent variables are correlated with one another in a multiple regression analysis, this condition is called: a. heteroscedasticity. b. homoscedasticity. c. multicollinearity. d. None of these choices. ANS: C PTS: 1 REF: SECTION 17.3 113. The problem of multicollinearity arises when the: a. dependent variables are highly correlated with one another. b. independent variables are highly correlated with one another. c. independent variables are highly correlated with the dependent variable. d. None of these choices. ANS: B PTS: 1 REF: SECTION 17.3 114. If multicollinearity exists among the independent variables included in a multiple regression model, then: a. the regression coefficients will be difficult to interpret. b. the standard errors of the regression coefficients for the correlated independent variables will increase. c. one or more of the coefficients may have the wrong sign. d. All of these choices are true. ANS: D PTS: 1 REF: SECTION 17.3 115. If a group of independent variables are not significant individually but are significant as a group at a specified level of significance, this is most likely due to:
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This note was uploaded on 09/28/2010 for the course FINOPMGT 250 taught by Professor Kumar during the Spring '10 term at University of Massachusetts Boston.

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SME_8e_Ch_17_Section_3 - CHAPTER 17 SECTION 3 MULTIPLE...

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