Question

What is exploratory factor analysis using everyday words and expressions (no jargons and complicated terminology please!)

Answer 1

Exploratory factor analysis is a method used by statisticians to
a. reduce the data in a short summary of the variable
b. This short summary helps to explain the internal structure or the interrelationship amount these variables.
Hence exploratory factor analysis is a data reduction and internal structure examination technique.

For example, if we have a survey which collects answers from the respondents about how they make their choice to buy a bar of soap.

Exploratory factor analysis helps us to understand how the variable(Question asked) are interrelated with each to finally give rise to the choice of soap.

This is done using two techniques
a. Making a correlation matrix and understanding their relationship.

b. Using Principle component analysis to extract the factor. It is a simple technique in which each factor affecting a target variable is represented by the perpendicular line using eigenvalues.