Teaching UGC NET Mock Test Series 2025 (Paper 1 & 2) Business Statistics and Research Methods Correlation and regression of two variables
Which of the following statements correctly describes the primary purpose of using Weighted Least Squares (WLS) in regression analysis?
1
Weighted Least Squares (WLS) is used when all observations are assumed to have equal variance and similar levels of influence on the regression outcome.
2
Weighted Least Squares (WLS) is used when the relationship between the independent and dependent variables is nonlinear, to transform it into a linear relationship.
3
Weighted Least Squares (WLS) is used when the error term’s variance differs across observations (heteroscedasticity), giving more weight to more accurately measured observations.
4
Weighted Least Squares (WLS) is used to mitigate the impact of high correlation among independent variables, or multicollinearity.