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Consider the regression model Salary= B1+B2WorkExperience+u

Suppose we have another variable Region which captures where the individuals in our data set live, and

Region = 1 if they live in the north

Region = 2 if they live in the south

Region = 3 if they live in the east

Region = 4 if they live in the west

We believe that Region affects the intercept of the linear relationship between Salary and WorkExperience.

If we wish to account for this in our model, how many additional regressors need to be included in our regression model.

A 3

B 4

C 6

D 7

Statistics and Probability, Statistics

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