You have a dataset with thousands of features, all of which are categorical. Using these features as predictors, you are tasked with creating a prediction model to accurately predict the value of a continuous dependent variable. Which of the following would be appropriate algorithms to use? (Select two.)
Lasso regression and ridge regression are both types of linear regression models that can handle high-dimensional and categorical data. They use regularization techniques to reduce the complexity of the model and avoid overfitting. Lasso regression uses L1 regularization, which adds a penalty term proportional to the absolute value of the coefficients to the loss function. This can shrink some coefficients to zero and perform feature selection. Ridge regression uses L2 regularization, which adds a penalty term proportional to the square of the coefficients to the loss function. This can shrink all coefficients towards zero and reduce multicollinearity. Reference: [Lasso (statistics) - Wikipedia], [Ridge regression - Wikipedia]
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