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The lavaan (Latent Variable Analysis) package in R is entirely free, highly respected in the scientific community, and incredibly powerful for SEM.

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Here is everything you need to know about LISREL 8.8, why repacks are dangerous, and how to get the software safely and legally. What is LISREL 8.8? The lavaan (Latent Variable Analysis) package in R

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It handles latent variables and observed variables simultaneously.