If a qualitative variable has "c" categories, how many dummy variables must be created and used in the regression analysis?
A)c - 1
B)c
C)c + 1
D)c - 2
E)4 + c

Name: If a qualitative variable has "c" categories, how many dummy variables must be created and used in the regression analysis? A)c - 1 B)c C)c + 1 D)c - 2 E)4 + c
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Question

Quizplus · Accepted Answer

In regression analysis, if a qualitative variable has "c" categories, you create "c - 1" dummy variables to avoid the dummy variable trap, which is the issue of multicollinearity.

If a Qualitative Variable Has "C" Categories, How Many Dummy