Question: An analyst wants to build a regression model to predict spending from the following four predictor variables: Past Spending, Income, Net Worth and Age. A

An analyst wants to build a regression model to predict spending from the following four predictor variables: Past Spending, Income, Net Worth and Age. A correlation matrix of the four predictors shows:

Why might a stepwise regression search not find the same model as an €œall subsets€ regression?

Income Net Worth Age Past Spending 0.442 0.433 Income Net Worth 0.446 0.968 0.992 0.976

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