Abstract
The objective of factor analysis is to extract underlying “factors” that explain the correlations among a set of variables. It essentially summarises a large number of variables with a smaller set of derived variables. For example, in a survey, many variables relating to consumption of products might be expressed as a function of just three factors related to ‘product quality’, ‘product utility’ and ‘product price’. Factor analysis seeks to identify these underlying (and not directly observable) dimensions.
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Aljandali, A. (2017). Factor Analysis. In: Multivariate Methods and Forecasting with IBM® SPSS® Statistics. Statistics and Econometrics for Finance. Springer, Cham. https://doi.org/10.1007/978-3-319-56481-4_5
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DOI: https://doi.org/10.1007/978-3-319-56481-4_5
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Publisher Name: Springer, Cham
Print ISBN: 978-3-319-56480-7
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