In Multiple Regression Analysis, a Dummy Variable Is ____________

question 16

Multiple Choice

In multiple regression analysis, a dummy variable is ____________.

• A) An additional quantitative variable
• B) A nominal variable with three or more values
• C) A nominal variable with only two values
• D) A new regression coefficient

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Definitions:

Least-Squares Regression

A statistical method used to determine the line of best fit by minimizing the sum of the squares of the differences between observed and predicted values.

Lubrication Cost

Expenses associated with the lubrication of machinery and equipment to ensure smooth operation and reduce wear and tear.

Net Operating Income

Income originating from a corporation's central business endeavors, excluding subtractions for interest and taxes.

Variable Component

A portion of a cost or expense that varies directly with changes in production volume, business activity, or other variables.