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Chapter 11

chapter 11.docx

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Department
Statistics
Course Code
STATS 2B03
Professor
Aaron Childs

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Stats 2B03: Statistical Methods for Science
Chapter 11: Regression Analysis Some Additional Techniques
11.2 Qualitative Independent Variables
- Dummy variables:
A dummy variable is a variable that assumes only a finite number of
values (such as 0 or 1) for the purpose of identifying the different
categories of a qualitative variable
- A confidence interval for β2:
 
- Advantages of dummy variables:
If we can justify the assumption that the two separate regression lines
have the same slope, we can get a better estimate of this common
slope through the use of dummy variables, which entails pooling the
data from the two subsamples
Also yields more precise inferences regarding other parameters since
more degrees of freedom are available for the calculation of the error
mean square
- Use of dummy variables interaction present:
Interaction terms represent the interaction between the quantitative
and the qualitative independent variables
- Inference procedures:


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Description
Stats 2B03: Statistical Methods for Science Chapter 11: Regression Analysis – Some Additional Techniques 11.2 Qualitative Independent Variables - Dummy variables:  A dummy variable is a variable that assumes only a finite number of values (such as 0 or 1) for the purpose of identifying the different categories of a qualitative variable - A confidence interval for β : 2  - Advantages of dummy variables:  If we can justify the assumption that the two separate regression lines have the same slope
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