Created by

Terms in this set (33)

1. Categorical variables with no natural orders, such as types of car, among categories MUST be converted into a set of dummy variables.

2. Categorical variables with natural orders, such as customers' evaluation of a commodity, among categories can be converted into regular variables OR a set of dummy variables.

2. Categorical variables with natural orders, such as customers' evaluation of a commodity, among categories can be converted into regular variables OR a set of dummy variables.

1. In dealing with gender, adding a dummy for male and another dummy for female is not accepted, because of perfect collinearity.

2. Adding multiplication of dummy variables, similar to adding dummy variables, only SHIFTS up or down the fitted lines between the variable of interest and numerical variables.

2. Adding multiplication of dummy variables, similar to adding dummy variables, only SHIFTS up or down the fitted lines between the variable of interest and numerical variables.

1. It is possible that both dummy variable and the numerical variable are statistically significant, but the interaction is completely insignificant.

2. We use the interaction between dummy variables and numerical variables to analyze the different effects of numerical variables on variables of interest for different groups in the dummy variable.

2. We use the interaction between dummy variables and numerical variables to analyze the different effects of numerical variables on variables of interest for different groups in the dummy variable.

## Sets found in the same folder

## Other sets by this creator

## Verified questions

business math

## Recommended textbook solutions

### Statistical Techniques in Business and Economics

15th Edition•ISBN: 9780073401805Douglas A. Lind, Samuel A. Wathen, William G. Marchal1,236 solutions

### Introductory Business Statistics

1st Edition•ISBN: 9781506699844Alexander Holmes, Barbara Illowsky, Susan Dean2,157 solutions

### Financial Accounting

4th Edition•ISBN: 9781259730948Don Herrmann, J. David Spiceland, Wayne Thomas1,097 solutions

### Statistics for Business and Economics

13th Edition•ISBN: 9781337359917David R. Anderson, Dennis J. Sweeney, James J Cochran, Jeffrey D. Camm, Thomas A. Williams1,692 solutions

## Other Quizlet sets

1/5