An example of the interaction term between two independent, continuous variables is A)Y_i = β₀ + β₁X_i + β₂D_i + β₃(X_i × D_i)+ u_i. B)Y_i = β₀ + β₁X₁_i + β₂X₂_i + u_i. C)Y_i = β₀ + β₁D₁_i + β₂D₂_i + β₃ (D₁_i × D₂_i)+ u_i. D)Y_i = β₀ + β₁X₁_i + β₂X₂_i + β₃(X₁_i × X₂_i)+ u_i.

Question

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The interaction term between two independent, continuous variables is represented by the product of those variables, as shown in option D with (X₁_i × X₂_i).

An Example of the Interaction Term Between Two Independent, Continuous