SOA Exam SRM Sample Question 70
Study guide: Exam SRM
A dataset has 100 observations with six predictor variables, X1, X2, X3, X4, X5, and X6 and a response variable, Y. Three ordinary regression models have been run, with the following results:
| Model Number | Variables Used | Residual Sum of Squares | Residual Standard Error |
|---|---|---|---|
| I | X1 only | 183,663.30 | 43.2911 |
| II | X1 and X2 only | 8,826.47 | 9.5391 |
| III | X1, X2, X3, X4, X5, and X6 | 8,319.59 | 9.4582 |
The Akaike Information Criterion (AIC) is to be used to select the best model from these three choices.
Determine which of the following statements is true.
- A) Select Model I with an AIC value of 1,838.42
- B) Select Model I with an AIC value of 1,874.12
- C) Select Model II with an AIC value of 91.84
- D) Select Model II with an AIC value of 91.90
- E) Select Model III with an AIC value of 93.93
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