Question: 5.4 What is a dummy variable or an indicator variable? Describe the differences in interpretation of the coefficients of a linear regression when the independent

5.4 What is a dummy variable or an indicator variable? Describe the differences in interpretation of the coefficients of a linear regression when the independent variable is continuous and when it is binary. Give an example of each case. Explain how the construction of confidence intervals and hypothesis tests is different when the independent variable is binary compared to when it is continuous.

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