Question

Consider the following regression model: Humidity = β0 + β1Temperature + β2Spring + β3Summer + β4Fall + β5Rain + ε, where the dummy variables Spring, Summer, and Fall represent the qualitative variable Season (spring, summer, fall, winter), and the dummy variable Rain is defined as Rain = 1 if rainy day, Rain = 0 otherwise. What is the regression equation for the winter rainy days?

Answer 1

Answer:

The regression equation for the winter rainy days is "Humidity = (β0 + β5) + β1Temperature".

Step-by-step explanation:

Given:

Humidity = β0 + β1Temperature + β2Spring + β3Summer + β4Fall + β5Rain + ε ...........(1)

Since there can be only one of spring, summer,fall, and winter at a point in time or in a season, we will have the following when there are winter rainy days:

Spring = 0

Summer = 0

Fall = 0

Rain = 1

Substituting all the relevant values into equation (1) and equating ε also to 0, a reduced form of equation (1) can be obtained as follows:

Humidity = β0 + β1Temperature + (β2 * 0) + (β3 * 0) + (β4 * 0) + (β5 * 1) + 0

Humidity = β0 + β1Temperature + 0 + 0 + 0 + β5 + 0

Humidity = (β0 + β5) + β1Temperature

Therefore, the regression equation for the winter rainy days is "Humidity = (β0 + β5) + β1Temperature".