Mastering Multicollinearity

• A situation where there is a strong negative relationship between two or more independent variables
• A situation where there is a strong positive relationship between two or more independent variables
• A situation where there is a perfect linear relationship between two or more independent variables (correct)
• A situation where there is no relationship between two or more independent variables

• It inflates the standard errors of the regression coefficients (correct)
• It makes the regression coefficients more accurate
• It has no impact on the standard errors of the regression coefficients
• It reduces the standard errors of the regression coefficients

• By examining the residuals of the regression model
• By examining the correlation matrix of the dependent variable
• By examining the correlation matrix of the independent variables (correct)
• By examining the p-values of the regression coefficients