In Using a Regression Model,if a New Independent Variable Is

question 38

Multiple Choice

In using a regression model,if a new independent variable is added,the value of R² (the coefficient of multiple determination) will ___________ decrease.

• A)Always
• B)Sometimes
• C)Never

---

Definitions:

Financial Intermediary

An institution that acts as a middleman between savers and borrowers, facilitating the flow of funds in the economy.

Households

Units of individuals living together, making joint decisions on consumption, savings, and investments, fundamental to economic analysis.

Common Stock

A form of corporate equity ownership, a type of security that represents ownership in a corporation and entitles the owner to a share of the company's profits.

Corporate Bond

A debt security issued by a corporation to raise financing for capital improvements, expansion, or other operational needs.