An economic researcher at a financial institution is designing a model that forecasts macroeconomic variables. The researcher considers applying regularization techniques such as the ridge regression approach, least absolute shrinkage and selection operator (LASSO) approach, or the elastic net approach to address the difficulty of estimating parameters in models that include multiple variables. After considering these three approaches, the researcher decides on using the elastic net. Which of the following statements about the use of an elastic net is correct?