1.Which of the following is true regarding a regression model with multicollinea
ID: 2900673 • Letter: 1
Question
1.Which of the following is true regarding a regression model with multicollinearity, a high r2 value, and a low F-test significance level?
The model is not a good prediction model.
The high value of r2 is due to the multicollinearity.
The interpretation of the coefficients is valuable.
The significance level tests for the coefficients are not valid.
The significance level for the F-test is not valid.
2. A company is considering producing some new Gameboy electronic games. Based on past records, management believes that there is a 70 percent chance that each of these will be successful and a 30 percent chance of failure. Market research may be used to revise these probabilities. In the past, the successful products were predicted to be successful based on market research 90 percent of the time. However, for products that failed, the market research predicted these would be successes 20 percent of the time. If market research is performed for a new product, what is the probability that the product will be successful if the market research indicates a failure?
0.20
0.90
0.91
0.63
0.23
3. Which of the following statements is true regarding a scatter diagram?
It provides very little information about the relationship between the regression variables.
It is a plot of the independent and dependent variables.
It is a line chart of the independent and dependent variables.
It has a value between -1 and +1.
It gives the percent of variation in the dependent variable that is explained by the independent variable.
The model is not a good prediction model.
The high value of r2 is due to the multicollinearity.
The interpretation of the coefficients is valuable.
The significance level tests for the coefficients are not valid.
The significance level for the F-test is not valid.
2. A company is considering producing some new Gameboy electronic games. Based on past records, management believes that there is a 70 percent chance that each of these will be successful and a 30 percent chance of failure. Market research may be used to revise these probabilities. In the past, the successful products were predicted to be successful based on market research 90 percent of the time. However, for products that failed, the market research predicted these would be successes 20 percent of the time. If market research is performed for a new product, what is the probability that the product will be successful if the market research indicates a failure?
0.20
0.90
0.91
0.63
0.23
3. Which of the following statements is true regarding a scatter diagram?
It provides very little information about the relationship between the regression variables.
It is a plot of the independent and dependent variables.
It is a line chart of the independent and dependent variables.
It has a value between -1 and +1.
It gives the percent of variation in the dependent variable that is explained by the independent variable.
Explanation / Answer
2. p(unsuccessful market) * p(actually unsucessfful)
= p(unsucessful market) * (1-p(actually successful))
= 0.3 * (1-0.2) = 0.24 (C)
3.It is a plot of the independent and dependent variables
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