1. Dummy variables HSPM J716

2. Categories In category = 1 Not = 0

3. Interpretation of coefficient Y = α + βD + γX + error β is the (mean/expected) difference in Y between being in the category and not being in the category, holding X constant.

4. Savings DRG creep

5. Multiple categories If mutually exclusive – No observation is in two categories And if mutually exhaustive – Each observation is in one of the categories Then leave one category’s dummy variable out of your equation Each dummy’s coefficient is the difference between that dummy’s category and the left- out dummy’s category.

6. jewelry

7. Dummy dependent variable