The dummy variable trap is an example of:Multiple choice

Question Image
A

a. imperfect multicollinearity

B

b. something that is of theoretical interest only

C

c. something that does not happen to university or college students

D

d. perfect multicollinearity

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A researcher is considering the following variables as determinants to the variable earnings (Earn): Variable DFemme is a binary variable that takes the value 1 if the individual is a female, and 0 otherwise; Variable DMale is a binary variable that takes on the value 1 if the individual is male, and is 0 otherwise; Variable DMarried is a binary variable that takes on the value 1 for married individuals and is 0 otherwise; Variable DSingle is is a binary variable that takes on the value 1 for unmarried individuals and is 0 otherwise; Variable X is a control variable that has continuous values. The researcher would like to regress logarithmic weekly earnings (Earn) on these explanatory variables. Select ALL models below that do NOT suffer perfect multicollinearity:

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Choose ALL CORRECT statement(s) about the imperfect multicollinearity:

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