ii) Below is the correlation matrix of the variables Y, X₁, X₂ and X3. Test for the presence of multicollinearity between X1 and X2, between X1 and X3, and between X2 and X3 if the sample size was n=21.

ii) Below is the correlation matrix of the variables Y, X₁, X₂ and X3. Test for the presence of multicollinearity between X1 and X2, between X1 and X3, and between X2 and X3 if the sample size was n=21.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Question

(ii) Below is the correlation matrix of the variables Y, X₁, X2 and X3. Test for the
presence of multicollinearity between X1 and X2, between X1 and X3, and
between X2 and X3 if the sample size was n=21.
Y
X₁
X₂
X3
X₁
0.8986
X₂
0.9867
0.3123
X3
0.8995
0.8799
0.7664

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