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How are indicator variables related to explanatory variables?


Asked by Zahir Hammond on Dec 14, 2021 FAQ



Such variables classify the data into mutually exclusive categories. These variables are called indicator variable or dummy variables. Usually, the indicator variables take on the values 0 and 1 to identify the mutually exclusive classes of the explanatory variables. For example,
Just so,
Indicator Variables In general, the explanatory variables in any regression analysis are assumed to be quantitative in nature. For example, the variables like temperature, distance, age etc. are quantitative in the sense that they are recorded on a well-defined scale.
Thereof, For example, many factors may appear to be related to systolic blood pressure, including age, dietary and other lifestyle factors. We should only include explanatory variables in a model if there is reason to suppose, from a biological or clinical standpoint, that they are related to the dependent variable.
In this manner,
The coefficient value represents the mean change of the dependent variable given a one-unit shift in an independent variable. Consequently, you might think you can use the absolute sizes of the coefficients to identify the most important variable. After all, a larger coefficient signifies a greater change in the mean of the independent variable.
In fact,
A response variable is the particular quantity that we ask a question about in our study. An explanatory variable is any factor that can influence the response variable.