Which of the following statistical methods reduces data by identifying and then classifying similar entities into subgroups?

A) Multiple regression
B) Survey research
C) Simple correlation
D) Cluster analysis

Cluster analysis is a statistical method that groups similar entities together into subgroups based on a set of variables. This method reduces the data by simplifying the analysis and highlighting patterns and relationships within the data. Multiple regression, survey research, and simple correlation do not involve the classification of similar entities into subgroups.