Revision as of 00:29, 24 April 2024 by Admin (Created page with "Determine which of the following statements describe the advantages of using an alternative fitting procedure, such as subset selection and shrinkage, instead of least squares. <ul style="list-style-type:upper-roman"> <li>Doing so will likely result in a simpler model</li> <li>Doing so will likely improve prediction accuracy</li> <li>The results are likely to be easier to interpret</li> </ul> <ul class="mw-excansopts"> <li>I only</li> <li>II only</li> <li>III only</li>...")
ABy Admin
Apr 24'24
Exercise
Determine which of the following statements describe the advantages of using an alternative fitting procedure, such as subset selection and shrinkage, instead of least squares.
- Doing so will likely result in a simpler model
- Doing so will likely improve prediction accuracy
- The results are likely to be easier to interpret
- I only
- II only
- III only
- I, II, and III
- The correct answer is not given by (A), (B), (C), or (D)
Copyright 2023. The Society of Actuaries, Schaumburg, Illinois. Reproduced with permission.
ABy Admin
Apr 24'24
Key: D
Alternative fitting procedures will tend to remove the irrelevant variables from the predictors, thus resulting in a simpler and easier to interpret model. Accuracy will likely be improved due to reduction in variance.
Copyright 2023. The Society of Actuaries, Schaumburg, Illinois. Reproduced with permission.