12. When two explanatory variables are highly correlated, should you remove one of the correlated explanatory variables to reduce the multicollinearity problem.
A. No, it will cause the coefficient on the remaining variable to be biased.
B. Yes, it will improve the fit of the regression model.
C. No, it will not affect the t statistics on the coefficients.
D. Yes, it will reduce the standard errors on the coefficients and increase the t statistics.
B. Yes, it will improve the fit of the regression model.
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