Question 2 1 pts In a regression model with two predictors, the correlation betw

Question

Question 2 1 pts In a regression model with two predictors, the correlation between the two predictors is 0.96. Among the following, select what can happen. O The columns of the design matrix X are linearly dependent, and there are infinitely many solutions to the normal equations. The p-values of the t-test for the coefficients 1 and 2 are both very small, even if the predictors are irrelevant. O The variance inflaction factors are high. O The estimated coefficients 1 and 2 have opposite sign from what we can expect based on the correlation between each predictor and the response

Explanation / Answer

If the correlation between predictors is high (0.96), there exists multicollinearity in regression model and hence the model will report high variance inflation factor(VIF).

So, the correct option is

The variance inflation factors are high.

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