Author Question: Assume you are considering including two additional qualitative variables into a regression model. ... (Read 127 times)

penguins · **on:** Jul 24, 2018

Assume you are considering including two additional qualitative variables into a regression model. The first variable has 4 categories, and the second variable has 4 categories as well. Given this information, how many indicator variables will be incorporated into the model?
a. 8
b. 7
c. 6
d. 5
e. 4

Question 2

Which of the following statements is true?
a. It is appropriate to compute a correlation coefficient for the relationship between a dummy variable and a dependent variable.
b. If a qualitative variable has m categories, you should use m - 1 dummy variables to incorporate the qualitative variable into a regression model.
c. Dummy variables are used to incorporate qualitative variables into a regression model.
d. All of these.
e. None of these.