In the Case of Regression with Interactions, the Coefficient of a Binary

question 62

Multiple Choice

In the case of regression with interactions, the coefficient of a binary variable should be interpreted as follows:

• A)there are really problems in interpreting these, since the ln(0)is not defined.
• B)for the case of interacted regressors, the binary variable coefficient represents the various intercepts for the case when the binary variable equals one.
• C)first set all explanatory variables to one, with the exception of the binary variables. Then allow for each of the binary variables to take on the value of one sequentially. The resulting predicted value indicates the effect of the binary variable.
• D)first compute the expected values of Y for each possible case described by the set of binary variables. Next compare these expected values. Each coefficient can then be expressed either as an expected value or as the difference between two or more expected values.

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Definitions:

Relative Cell References

Relative cell references in spreadsheets are cell addresses that change when a formula is copied to other cells, adjusting based on the formula's new location.

Point Mode

In spreadsheet applications, a mode that allows the user to select cells or ranges by using the mouse to point and click rather than typing cell references.

Arithmetic Calculations

Mathematical operations involving addition, subtraction, multiplication, and division.

Function

In programming, a named section of a code that performs a specific task; in mathematics, a relation between a set of inputs and a set of permissible outputs.