The following are the key concepts on which factor analysis is based.
Basic concepts in factor analysis
The
following are the key concepts on which factor analysis is based.
Factor:
A factor plays a fundamental role
among a set of attributes or variables. These variables can be filtered down to
the factor. A factor represents the combined effect of a set of attributes.
Either there may be one such factor or several such factors in a real life
problem based on the complexity of the situation and the number of variables
operating.
Factor loading:
A factor loading is a value that
explains how closely the variables are related to the factor. It is the
correlation between the factor and the variable. While interpreting a factor,
the absolute value of the factor is taken into account.
Communality:
It is a measure of how much each
variable is accounted for by the underlying factors together. It is the sum of
the squares of the loadings of the variable on the common factors. If A,B,C,…
are the factors, then the communality of a variable is computed using the
relation
Eigen value:
The sum of the squared values of
factor loadings pertaining to a factor is called an eigen value. It is a
measure of the relative importance of each factor under consideration. Total Sum Of Squares (TSS)
It is the
sum of the eigen values of all the factors.
Tags : Research Methodology - Factor Analysis And Conjoint Analysis
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