Which of These Statements Is Not True

question 15

Multiple Choice

Which of these statements is not true?

• A) If the average variance inflation factor is greater than 1 then the regression model might be biased.
• B) Tolerance values above 0.2 may indicate multicollinearity in the data.*
• C) Multicollinearity in the data is shown by a variance inflation factor (VIF) greater than 10.
• D) The tolerance is 1 divided by the VIF.

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Definitions:

Exchange Rate

The price of one currency in terms of another currency, which determines how much foreign currency one can buy with a unit of domestic currency.

Euros

The formal monetary system adopted by 19 out of the 27 countries within the European Union, commonly referred to as the eurozone.

Appreciated

Refers to an increase in the value of an asset over time.

International Trade

The exchange of goods, services, and capital between countries or territories, which can lead to increased economic growth and efficiency for participating nations.