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Use Indicator (Dummy) Variables in Multiple Regression

Question 8

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Use indicator (dummy) variables in multiple regression.
-A sample of firms was selected from the high tech industry (Industry = 1) and the
Financial services sector (Industry = 0) . Data were collected on the following variables:
Turnover rate, job growth, number of employees, and innovative index (higher scores
Indicate a more innovative and creative organizational culture) . What does the scatterplot
Below suggest about developing a multiple regression model to predict turnover rate? Use indicator (dummy)  variables in multiple regression. -A sample of firms was selected from the high tech industry (Industry = 1)  and the Financial services sector (Industry = 0) . Data were collected on the following variables: Turnover rate, job growth, number of employees, and innovative index (higher scores Indicate a more innovative and creative organizational culture) . What does the scatterplot Below suggest about developing a multiple regression model to predict turnover rate?   A)  Using Job Growth as an indicator variable in this model is appropriate. B)  Using the interaction term Job Growth*Industry in the model is appropriate. C)  Using Industry as an indicator variable in this model is appropriate. D)  Job Growth should not be included in the model as a variable. E)  None of the above.


A) Using Job Growth as an indicator variable in this model is appropriate.
B) Using the interaction term Job Growth*Industry in the model is appropriate.
C) Using Industry as an indicator variable in this model is appropriate.
D) Job Growth should not be included in the model as a variable.
E) None of the above.

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