Define multicollinearity.

Please make sure that your paper conforms to APA style requirements.

Purpose Statement and Model

1) In the introductory paragraph, state why the dependent variable has been chosen for analysis. Then make a general statement about the model:

“The dependent variable _______ is determined by variables ________, ________, ________, and ________.”

2) In the second paragraph, identify the primary independent variable and defend why it is important.

“The most important variable in this analysis is ________ because _________.” In this paragraph, cite and discuss the two research sources that support the thesis, i.e., the model.

3) Write the general form of the regression model (less intercept and coefficients), with the variables named appropriately so reader can identify each variable at a glance:

Dep_Var = Ind_Var_1 + Ind_Var_2 + Ind_Var_3

For instance, a typical model would be written:

Price_of_Home = Square_Footage + Number_Bedrooms + Lot_Size

Where

Price_of_Home: brief definition of dependent variable

Square_Footage: brief definition of first independent variable

Number_Bedrooms: brief definition of second independent variable

Lot_Size: brief definition of third independent variable

[Note: student of course replaces these variable names with his/her own variable names.]

Definition of Variables

4) Define and defend all variables, including the dependent variable, in a single paragraph for each variable. Also, state the expectations for each independent variable. These paragraphs should be in numerical order, i.e., dependent variable, X1, then X2, etc.

In each paragraph, the following should be addressed:

• How is the variable defined in the data source?
• Which unit of measurement is used?
• For the independent variables: why does the variable determine Y?
• What sign is expected for the independent variable’s coefficient, positive or negative? Why?

Data Description

5) In one paragraph, describe the data and identify the data sources.

• From which general sources and from which specific tables are the data taken? (Citing a website is not acceptable.)
• Which year or years were the data collected?