Assume You Are Considering Including Two Additional Qualitative Variables into a Regression

question 50

Multiple Choice

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

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Definitions:

Sherman Act

A landmark federal statute in the scope of U.S. antitrust law passed by Congress in 1890, which prohibits monopolistic practices and promotes competition.

Per Se Violation

An act that is inherently illegal, without the need for further evidence to prove its unlawfulness.

Economic Harm

Financial damage or loss experienced by an individual or entity due to another party's actions or events.

Territorial Restriction

Limitations placed on where a product can be sold or a service can be provided, often used by companies to divide markets or control franchises.