Question

1. If a categorical variable has ? levels, indicator variables are required with each indicator

variable being coded as 0 or 1.

a. ?

b. ? − 1

c. ? − 2

d. None of these alternatives is correct.

2. The standardized residual plot can be used to

a. check normality assumption of the error term ?.

b. detect outliers.

c. detect influential observations.

d. Both a and b.

3. The following regression model ? = ?0 + ?1?1 + ?2?1

2 + ?3?1

3 + ? is known as

a. first-order model with one predictor variable

b. second-order model with one predictor variables

c. third-order model with one predictor variable

d. third-order model with three predictor variable

4. A variable such as ?, whose value is ? = ?1?2 is added to a general linear model in order to account

for potential effects of two variables ?1 and ?2 acting together. This type of effect is

a. called multicollinearity effect

b. called interaction

c. called transformation effect

d. impossible to occur

5. The general linear model

a. cannot be used to accommodate curvilinear relationships between dependent variable and

independent variables

b. can be used to accommodate curvilinear relationships between the independent variables

and dependent variable

c. must contain more than 2 independent variables

d. None of these alternatives is correct.

6. Which of the following tests is used to determine whether an additional set of several independent

variables makes a significant reduction in SSE to a multiple regression model?

a. ? test

b. ? test

c. ? test

d. ?2 test

7. Suppose we want to study the relationship between sales(?)($1,000s) and price of a product (?)($).

The estimated regression equation

1/?̂ = 7.4 − 0.23 ?

was obtained. Estimate the average sales when price of the product is $30.

a. $2,000

b. $0.5

c. $500

d. $20,548

Answer 1

Here' the answer to the question. please write back in case you've doubts.

1.

If a categorical variable has ? levels, indicator variables are required with each indicator variable being coded as 0 or 1 then : k-1 are required to show k categories

For example, if you have to display 2 categories : Female and Male lets see:
We can designate a variable "Gender" 1 ( for female), 0 ( for male), hence we can use 1 variable instead of 2

Answer is (b) k-1