The level in the denominator is known as the reference level. In this example, Public School is the reference level. If this odds ratio equals 3.0, the odds of graduating with honors are three times greater for home-schooled students than for public school students.
Variable | Type | Description |
---|---|---|
HYBRID | Binary response variable | Equals 0 if the customer did not buy a hybrid car, and 1 if the customer did. |
GENDER | Binary predictor variable | Equals 0 if the customer is male, and 1 if the customer is female. The reference level is male. |
AGE | Continuous predictor variable | Equals the customer's age. Can equal any nonnegative value. |
Suppose the logistic regression procedure declares both predictors to be significant. If GENDER has an odds ratio of 2.0, the odds of a woman buying a hybrid car are twice the odds of a man. If AGE has an odds ratio of 1.05, then the odds that a customer buys a hybrid car increase by 5% for each additional year of age.