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# 3 - CHAPTER 18 SECTION 2-3 MODEL BUILDING MULTIPLE CHOICE...

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1 CHAPTER 18 SECTION 2-3: MODEL BUILDING MULTIPLE CHOICE 76. In explaining the amount of money spent on children's clothes each month, which of the following independent variables is best represented with an indicator variable? a. Age b. Height c. Gender d. Weight ANS: C PTS: 1 REF: SECTION 18.2-18.3 77. In explaining students' test scores, which of the following independent variables would not best be represented with indicator variables? 78. In explaining starting salaries for graduates of accountancy programs, which of the following independent variables would not best be represented with dummy variables? 79. In explaining the income earned by college graduates, which of the following independent variables is best represented by a dummy variable? 80. If a nominal independent variable has 4 possible categories, the number of dummy variables needed to uniquely represent these categories is: a. 5. b. 4. c. 3. d. 2. ANS: C PTS: 1 REF: SECTION 18.2-18.3

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2 81. An indicator variable is a variable that can assume: 82. An indicator variable is also called: 83. In general, to represent a nominal independent variable that has m possible categories, we must create: 84. In regression analysis, indicator variables allow us to incorporate: a. interval variables into the model. b. nominal variables into the model. c. first-order variables into the model. d. None of these choices. ANS: B PTS: 1 REF: SECTION 18.2-18.3 85. If a nominal independent variable contains 5 categories, the number of dummy variables needed to uniquely represent these categories is: 86. Suppose that we want to model the randomized block design of the analysis of variance with, say, one nominal variable with three categories and one nominal variable with four categories. We would create:
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