Which of the Following Best Describes When to Use an Indicator

question 27

Multiple Choice

Which of the following best describes when to use an indicator variable in a regression?

• A) To include a quantitative variable in a regression model.
• B) To include a qualitative variable in a regression model.
• C) To include any variable in a regression model.
• D) To include a y variable in a regression model.

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Definitions:

Budgeted Activity

The planned level of output or activity for a specific period, used for planning and control purposes.

Labor Rate Variance

The difference between the actual hourly wage paid to workers and the expected wage, multiplied by the actual hours worked.

Labor Efficiency Variance

The difference between the actual labor hours taken to produce a good or service and the standard labor hours expected, multiplied by the labor rate.

Direct Labor

Labor costs directly associated with the production of goods or services, including wages for workers who physically produce a product.