Factor Analysis

To perform a factor analysis, all of the variables in the analysis must be measured continuously, and have normal distributions. It is also important to have a large enough sample size. A general rule of thumb is that you need 30 cases for the first observed variable and 10 cases for each additional observed variable in a factor analysis. So if you have 10 observed variables in the analysis, you should have at least 30 + 90 cases in your sample, for a total of 120. I think factor analysis is a confusing subject to discuss in the abstract, so I will rely heavily on examples for this discussion.