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In the Regression Model Yi=β0+β1Xi+β2Di+β3(Xi×Di)+uiY _ { i } = \beta _ { 0 } + \beta _ { 1 } X _ { i } + \beta _ { 2 } D _ { i } + \beta _ { 3 } \left( X _ { i } \times D _ { i } \right) + u _ { i }

Question 15

Multiple Choice

In the regression model Yi=β0+β1Xi+β2Di+β3(Xi×Di) +uiY _ { i } = \beta _ { 0 } + \beta _ { 1 } X _ { i } + \beta _ { 2 } D _ { i } + \beta _ { 3 } \left( X _ { i } \times D _ { i } \right) + u _ { i } where X is a continuous variable and D is a binary variable, β2\beta _ { 2 }


A) is the difference in means in Y between the two categories.
B) indicates the difference in the intercepts of the two regressions.
C) is usually positive.
D) indicates the difference in the slopes of the two regressions.

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