Problem
1. Define the term "multicollinearity." Explain how you would detect its presence in a multiple regression equation you have estimated. What are the consequences of multicollinearity, and what are the solutions?
2. Explain the following methods.
(a) Ridge regression.
(b) Omitted-variable regression.
(c) Principle component regression. What are the problems these methods are supposed to solve?
The response should include a reference list. Double-space, using Times New Roman 12 pnt font, one-inch margins, and APA style of writing and citations.