📢 Too many exams? Don’t know which one suits you best? Book Your Free Expert 👉 call Now!


    Question

    Calculate the value of VIF in case of Multicollinearity,

    if the Ri2(Coefficient of auxiliary regression on independent variables) is 0.60 and the variance of the OLS estimator is 2.
    A 5.00 Correct Answer Incorrect Answer
    B 1.60 Correct Answer Incorrect Answer
    C 1.25 Correct Answer Incorrect Answer
    D 2.5 Correct Answer Incorrect Answer

    Solution

    VIF= 1/ (1-Ri2) = 1/ (1-0.6) = 1/0.4 = 2.5

    Practice Next
    More International Trade Questions
    ask-question