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Changed the equations to MathJax to make it more readable
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Chill2Macht
Chill2Macht
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Consider$\newcommand{\Balance}{\operatorname{Balance}}$$\newcommand{\Income}{\operatorname{Income}}$Consider the following model:

$Balance = B_0 +B_1 * Income + B_2 * Gender$$\Balance = B_0 +B_1 * \Income + B_2 * \operatorname{Gender}$

Gender is a qualitative variable so we are going to use a dummy variable such that it is 0 when its male and 1 when its female.

So,

$Balance(Income,Male) = B_0 + B_1 * Income$$\Balance(\Income,\operatorname{Male}) = B_0 + B_1 * \Income$

$Balance(Income, Female) = B_0 + B_1 * income + B_2$$\Balance(\Income, \operatorname{Female}) = B_0 + B_1 * \Income + B_2$

Does this mean that being a male has on effect on the balance and if you are a male, your balance would depend only on the income? And if you are a female, then your balance depends on both you income and gender?

Consider the following model:

$Balance = B_0 +B_1 * Income + B_2 * Gender$

Gender is a qualitative variable so we are going to use a dummy variable such that it is 0 when its male and 1 when its female.

So,

$Balance(Income,Male) = B_0 + B_1 * Income$

$Balance(Income, Female) = B_0 + B_1 * income + B_2$

Does this mean that being a male has on effect on the balance and if you are a male, your balance would depend only on the income? And if you are a female, then your balance depends on both you income and gender?

$\newcommand{\Balance}{\operatorname{Balance}}$$\newcommand{\Income}{\operatorname{Income}}$Consider the following model:

$\Balance = B_0 +B_1 * \Income + B_2 * \operatorname{Gender}$

Gender is a qualitative variable so we are going to use a dummy variable such that it is 0 when its male and 1 when its female.

So,

$\Balance(\Income,\operatorname{Male}) = B_0 + B_1 * \Income$

$\Balance(\Income, \operatorname{Female}) = B_0 + B_1 * \Income + B_2$

Does this mean that being a male has on effect on the balance and if you are a male, your balance would depend only on the income? And if you are a female, then your balance depends on both you income and gender?

Changed the equations to MathJax to make it more readable
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edit approved Jan 8, 2017 at 11:46
ab90hi
edit approved Jan 8, 2017 at 11:46
ab90hi
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Consider the following model:

Balance = B0 +B1 * income + B2 * Gender$Balance = B_0 +B_1 * Income + B_2 * Gender$

Gender is a qualitative variable so we are going to use a dummy variable such that it is 0 when its male and 1 when its female.

So,

Balance(income,Male) = B0 + B1 * income$Balance(Income,Male) = B_0 + B_1 * Income$

Balance(income, Female) = B0 + B1 * income + B2$Balance(Income, Female) = B_0 + B_1 * income + B_2$

Does this mean that being a male has on effect on the balance and if you are a male, your balance would depend only on the income? And if you are a female, then your balance depends on both you income and gender?

Consider the following model:

Balance = B0 +B1 * income + B2 * Gender

Gender is a qualitative variable so we are going to use a dummy variable such that it is 0 when its male and 1 when its female.

So,

Balance(income,Male) = B0 + B1 * income

Balance(income, Female) = B0 + B1 * income + B2

Does this mean that being a male has on effect on the balance and if you are a male, your balance would depend only on the income? And if you are a female, then your balance depends on both you income and gender?

Consider the following model:

$Balance = B_0 +B_1 * Income + B_2 * Gender$

Gender is a qualitative variable so we are going to use a dummy variable such that it is 0 when its male and 1 when its female.

So,

$Balance(Income,Male) = B_0 + B_1 * Income$

$Balance(Income, Female) = B_0 + B_1 * income + B_2$

Does this mean that being a male has on effect on the balance and if you are a male, your balance would depend only on the income? And if you are a female, then your balance depends on both you income and gender?

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Bakhtawar
Bakhtawar
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Need clarification on using Qualitative Predictors in the Regression Model

Consider the following model:

Balance = B0 +B1 * income + B2 * Gender

Gender is a qualitative variable so we are going to use a dummy variable such that it is 0 when its male and 1 when its female.

So,

Balance(income,Male) = B0 + B1 * income

Balance(income, Female) = B0 + B1 * income + B2

Does this mean that being a male has on effect on the balance and if you are a male, your balance would depend only on the income? And if you are a female, then your balance depends on both you income and gender?