Dummy variables cannot be used to estimate the seasonal effects on a regression model applied to time-series data.

Question

Quizplus · Accepted Answer

Dummy variables can be used to estimate the seasonal effects on a regression model applied to time-series data. By including dummy variables for each season (e.g. 1 for winter, 0 for spring, 0 for summer, 0 for fall), the regression model can capture the effect of the season on the dependent variable.

Dummy Variables Cannot Be Used to Estimate the Seasonal Effects