1. Forecasters who base model selection criteria on the maximization of R2 should Muitiple
Choice be wary that extremely high values of R2 may indicate a definitional relationship rather
thon causal as required by the multiple regression models. be aware that the simple R-squared
measure is suspect when autocorrelation is present. be aware that R-squared can be made
arbitrarliy large by adding additional explanatory variables to the model. instead use the adjusted
R-squared measure. All of the options are correct.