(EViews 10)How to measure a good Regression model 1

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The best model can be only as good as the variables measured by the study. The results for the variables you include in the analysis can be biased by the significant variables that you don’t include. we'll review some common statistical methods for selecting models.
The research team tasked to investigate typically measures many variables but includes only some of them in the model. The analysts try to eliminate the variables that are not related and include only those with a true relationship. Along the way, the analysts consider many possible models.
a good regression model, you want to include the variables that you are specifically testing along with other variables that affect the response in order to avoid biased results. Here
The best model can be only as good as the variables measured by the study.
1. Your sample might be unusual, either by chance or by data collection methodology.
2. The predicted R-squared is a form of cross-validation and it can also decrease.
3. In regression, low p-values indicate terms that are statistically significant.
4. Diagnostics Test:
The model should be free from serial correlation
The Model should be free from Heteroscedasticity.
The Model should be free from ARCH Effect.
The Residuals should be Normally distributed
The model should be stable using CUSUM and CUSUMSQ
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