Question: Consider a regression study involving a dependent variable y, a quantitative independent variable x1, and a categorical independent variable with two possible levels (level 1,

Consider a regression study involving a dependent variable y, a quantitative independent

variable x1, and a categorical independent variable with two possible levels (level 1, level 2).

a) How many dummy variables are required to represent the categorical variable?

b) Write a multiple regression equation relating x1 and the categorical variable to y.

c) Interpret the parameters in your regression equation

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