When the Dependent Variable Is Binary (0 or 1), We

question 19

Multiple Choice

When the dependent variable is binary (0 or 1) , we need:

• A)stepwise regression.
• B)data transformation to improve conditioning.
• C)logistic regression.
• D)best subsets regression.

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Definitions:

Budget Deficit

occurs when a government's expenditures exceed its revenues during a specific period, leading to borrowing or debt accumulation.

Demand-for-loanable-funds

The desire or willingness of borrowers to take out loans at various interest rates, reflecting the demand for borrowing.

Vertical Axis

The y-axis in a graph, which typically represents the dependent variable in an equation or a chart.

Interest Rate

The percentage of an amount of money charged by a lender to a borrower for the use of assets, typically expressed as an annual percentage rate.