How many additional dummy variables are required if a categorical variable has 4 levels?
A) 2
B) 3
C) 1
D) 4

Name: How many additional dummy variables are required if a categorical variable has 4 levels? A) 2 B) 3 C) 1 D) 4
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Question

Quizplus · Accepted Answer

If a categorical variable has 4 levels, we need to create 3 dummy variables. This is because we need one less dummy variable than the number of levels. The remaining level becomes the reference category against which we compare the other levels. Therefore, the best choice is B - 3.

How Many Additional Dummy Variables Are Required If a Categorical