You are asked to include an interaction effect between two variables in a Multiple Linear Regression model. How would you approach this task, and what considerations would you need to keep in mind?

  • Add the variables
  • Divide the variables
  • Multiply the variables and include the interaction term in the model
  • Multiply the variables together
Including an interaction effect involves multiplying the variables together and adding this interaction term to the model. It's important to consider the meaningfulness of the interaction, possible multicollinearity with other variables, and the potential need for centering the variables to minimize issues with interpretation.
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