Interpret the coefficient of determination (
The coefficient of determination, often denoted as \( R^2 \), is a crucial measure in econometrics that assesses the goodness of fit of a regression model. It represents the proportion of the variance in the dependent variable that is explained by the independent variables in the model. In other words, \( R^2 \) quantifies the percentage of the variability in the dependent variable that can be accounted for by the independent variables.
The \( R^2 \) value ranges from 0 to 1, or from 0% to 100%. A value of 0 indicates that the model _______ ________ _____ _______ ___ _________ _______ _____.
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