Dummy variables can be used to address the problem of seasonality in regression models.

Question

Quizplus · Accepted Answer

Seasonality can be effectively handled by including dummy variables in regression models. These dummy variables represent each season and take a value of 0 or 1 depending on whether the observation corresponds to that season or not. This helps to capture the seasonal effect on the dependent variable and improves the accuracy of the model.

Dummy Variables Can Be Used to Address the Problem of Seasonality