A manager performs two regression analyses. The first has two independent variables, and the second has 3 (the two original variables plus one more). The table below shows the summary regression statistics for the two models. Using only these statistics, which model is preferred?

Regression Statistics

Model 1 (2 x's) Model 2 (3 x's)

Multiple R 0.7746 0.7937

R Square 0.6000 0.6300

Adjusted R Square 0.5385 0.5375

Standard Error 3.9604 3.9645

Observations 16 16

Below is the group of answer choices

A. The first because it has a higher adjusted R2value.

B. The second because models with more independent variables are always better predictors.

C. The first because it has a lower multiple R.

D. The second because it explains more of the variation in the dependent variable.

E. The second because it has a higher R2value.