If Independent Variables Are Not Significant Individually but Are Significant

question 2

Multiple Choice

If independent variables are not significant individually but are significant as a group at a specified level of significance, this is most likely due to

• A) autocorrelation.
• B) the presence of dummy variables.
• C) the absence of dummy variables.
• D) collinearity.

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Definitions:

Net Income

The total profit of a company after all expenses, taxes, and costs have been deducted from total revenues.

Mortgage Interest

Interest paid on a loan secured by a mortgage on a home, often tax-deductible under certain conditions.

Home Business

A business operated from the residence of the owner, leveraging the flexibility to manage personal and professional life.

§179 Expense Election

A provision of the U.S. tax code that allows businesses to deduct the full purchase price of qualifying assets financed or purchased during the tax year.