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NEW QUESTION: 1
A risk analyst peforming PCA wishes to explain 80% of the variance. The first orthogonal factor has a volatility of 100, and the second 40, and the third 30. Assume there are no other factors. Which of the factors will be included in the final analysis?
A. First and Second
B. Insufficient information to answer the question
C. First, Second and Third
D. First
Answer: D
Explanation:
Explanation
The total variance of the system is 100