PRC-2 · Chapter 10 · Question 39 of 60
Which of the following is a significant mathematical risk when using a linear regression model for 'extrapolation'?
Test yourself: pick an answer
Reveal answer & explanation
Correct answer: B) Predicting values entirely outside the historical range assumes the linear relationship continues indefinitely, which may be false.
Explanation
Extrapolation implies predicting outcomes beyond the limits of the sampled data. This is risky because the established linear relationship might flatten, curve, or break down completely at extreme levels.
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