Factor Analysis
Maximum likelihood method (MLE) " Goal: maximize the likelihood of producing the observed corr matrix " Assumption: distribution of variables (Y and F) is multivariate normal " Objective function: det(R MLE- ηI)=0, where R MLE=U-1(R-U2)U-1=U-1R LSU-1, and U2 is diag(1-h2) " Iterative fitting algorithm similar to LS approach
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