2. Statistical Methods

Regression Analysis — Quiz

Test your understanding of regression analysis with 5 practice questions.

Practice Questions

Question 1

In a linear regression model, if the coefficient of determination, $R^2$, is $0.90$, what percentage of the total variation in the dependent variable is explained by the independent variable(s)?

Question 2

When performing residual analysis, a plot of residuals versus fitted values shows a random scatter of points around zero. What does this pattern suggest about the linear regression model?

Question 3

An actuary is comparing two regression models for predicting insurance claims. Model A has an Akaike Information Criterion (AIC) of $1200$, and Model B has an AIC of $1150$. Which model is preferred based on the AIC, and why?

Question 4

In a generalized linear model (GLM) for predicting the number of insurance claims (count data), which distribution is typically most appropriate for the response variable?

Question 5

An actuary is developing a regression model to predict the probability of a policyholder lapsing (a binary outcome: lapse or no lapse). Which type of generalized linear model (GLM) is most appropriate for this scenario?