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How Many Binary Variables Are Required to Encode a Person's

question 44

Essay

How many binary variables are required to encode a person's age group as being either young, middle-age or old? What are the variables and what are the meanings of their 0, 1 values?


Definitions:

Debt-equity Ratio

A ratio illustrating the division of asset financing between shareholder equity and company debt.

Dividend Payout Ratio

The fraction of net income a firm pays to its shareholders in dividends, typically expressed as a percentage.

Dividend Payout Ratio

A metric that shows what portion of a company's earnings are distributed to shareholders in the form of dividends, typically expressed as a percentage.

External Financing Needed

The amount of funding a company must seek from outside sources to finance its business operations and growth ambitions beyond what it can generate internally.

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