Question

QUESTION 30
True or False: We can include a categorical variable (such as region) in a multivariate model in the same way we include a continuous variable.
True

False

2.5 points   

QUESTION 31
True or False: We fail to reject the null hypothesis if the test statistic is greater than the critical value.
True

False

2.5 points   

QUESTION 32
True or False: We necessarily do not have an omitted variable bias problem the omitted variable is uncorrelated with the included variable.
True

False

2.5 points   

QUESTION 33
True or False: When conducting analysis using categorical variables, we include a dummy variable for every category covered by the categorical variable.
True

False

Answer 1

ToAns. False because we use dummy variable to include a categorical variable into a multivariate model.

Ans. False because if the test statistic is greater than critical value then ut lies in the rejection region of the  bell curve and hence, we reject the null humypothesis.

Ans. False because ommited variable may or may not be related with the independent variable but is related to the dependent variable, thus, crating bias in the dependent variable value from the regression.

Ans. False because for n categories only n-1 dummy variables should be included bht if n dummy variables are included then there will be a problem of dummy variable trap

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