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Multicollinearity

Institution University
Course Mathematics
Year 1st Year
Semester Unknown
Posted By Rose Oloo
File Type pdf
Pages 25 Pages
File Size 390.54 KB
Views 7669
Downloads 87
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Description

A basic assumption is multiple linear regression model is that the rank of the matrix of observations on explanatory variables is the same as the number of explanatory variables. In other words, such a matrix is of full column rank. This, in turn, implies that all the explanatory variables are independent, i.e., there is no linear relationship among the explanatory variables. It is termed that the explanatory variables are orthogonal.
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