Testing the Goodness of the Model
The first and most important step in any empirical research is to determine if the model used in the study is acceptable. When conducting an empirical study, there are steps that must be taken before starting the study as well as results to be checked after the regression is performed. The present chapter addresses the topic of testing the model. In regression analysis, the goodness of fit is determined by testing the following hypothesis:
It is also important to understand what it means to say the “model is not good.” The simplest case is when the regression model only has one independent ...
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