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Factor Analysis

Factor Analysis is a type of Multivariate Analysis. Factor analysis takes a large number of continuous factors and combines them to form a small number of continuous factors that explain most of the variation in the response. These now factors are called 'eigenvectors'.

Suppose that you had the results of a questionnaire giving the reactions of customers on a new car. There were 100 questions in the questionnaire.

You might be able to form these questions into three eigenvectors, 'safety', 'esteem' and 'comfort' that explained 90% of the variation between the respondents, and by extension the potential customer base.

Factor Analysis is similar to Principal Components Analysis.

 MiC Quality offers online courses that can help you prepare for the American Society for Quality (ASQ) Certified Six Sigma Black Belt examination. Try out our courses by taking the first module of the Primer in Statistics free of charge.
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