Categorical and ordinal variables should be converted to dichotomous variables. Why. There are more intricate explanations, so long story short: Grade level, e.g. in the US: K, 1 through 12, is an ordinal variable. It can't be used as a analysis variables because there is no sense in taking the difference in grade nor the mean of grade. K, 1 through 12 are categories, they would work equally well if they were labeled A,B..M. being ordinal, there is only the set mathematical relationships that begin grade K is less than grade 1 through 12, 1 less than grade 2, etc.
Look at page 13 of this pdf to see how Gender can be coded with a dichotomous variable scheme. Mind you this is not the only way to do it.
referring to: SD-29.pdf (lexjansen.com)
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