May 5, 2021
Hi Aarti!
Multicollinearity is NOT a problem in this case. Do not care about multicollinearity between one variable and a second variable which is a deterministic non-linear function of the first one (e.g X and X²). Multicollinearity has to be checked when you want to estimate the independent effect of two variables which happen to be correlated by chance! X and X² are not correlated by chance.