The correct answer is: A. 0.7
Multicollinearity is a condition in which two or more independent variables are highly correlated with each other. This can cause problems in regression analysis, as it can make it difficult to determine which variable is actually causing the changes in the dependent variable.
The correlation coefficient is a measure of the strength of the linear relationship between two variables. A correlation coefficient of 0 indicates no linear relationship, while a correlation coefficient of 1 indicates a perfect linear relationship. A correlation coefficient of 0.7 indicates a strong linear relationship.
Therefore, in order for multicollinearity to be a problem, the correlation coefficient between two independent variables must be greater than 0.7.
Option B, 0.6, is incorrect because it is not a high enough correlation coefficient to cause multicollinearity. Option C, 0.5, is incorrect for the same reason. Option D, 0.4, is incorrect because it is a relatively low correlation coefficient and would not be considered to be multicollinearity.