Question

When confronted with multicollinearity, the best approach may be to do _______________________if the estimated model yields a high R2.

Answer 1

Deleting outliers is the best approach when there is multicollinearity and a high R2 in the estimated model.

Step-by-step explanation:

Outliers are data points that are located farther than two standard deviations above or below the best-fit line. By deleting these outliers and recalculating the best-fit line and correlation coefficient, we can determine if they are influential points that significantly affect the correlation and fit of the model.