Question

Assuming you have built a logistic regression model and the first iteration returned for following results:

Variable         P-value

Number of inquiries in the last 2 years 0.065

Number of bankcard accounts opened in the last year 0.0000

Number of bankruptcies filed in the last 2 years 0.070

Number of satisfactory credit card accounts in the last 2 years 0.042

Debt-to-income ratio 0.0000

Number of installment loans opened in the last 6 months 0.000

Number of personal finance loans opened in the last 6 months 0.082

At the 90% confidence level (i.e., alpha is 0.10) which would be the first variable that you would eliminate?

Select one:

a. Number of inquiries in the last 2 years  

b. Number of bankruptcies filed in the last 2 years

c. Number of personal finance loans opened in the last 6 months 0.082

d. None of these variables should be eliminated

Answer 1

We will eliminate by p-value Method,

We eliminate a variable if it has p-value >0.10=significance level given.

So in our problem all 7 variables has p-value <0.1.

So we will eliminate none of them.

Hence option D is correct.

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