When Selecting Explanatory Variables to Include in a Regression

question 48

Multiple Choice

When selecting explanatory variables to include in a regression

• A) you should pick all observable variables available.
• B) you should pick all observable variables that are likely to have a meaningful impact on the dependent variable.
• C) ignore all variables that have t-statistics less than the critical value.
• D) ignore variables that have an R² less than 1.

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Definitions:

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