Could you please tell me if it is possible to test an interaction between a latent variable (based on continuous indicators) and an observed variable that is categorical (0 = condition not present, 1= condition present)in SEM? Both the continuous latent variable and observed categorical variable are exogenous (not predicted by other variables). If so what is the best way to go about this? I was thinking I would use the MLR estimator.
Also, do I specify the categorical indicator as categorical in my syntax?
I have a medium sized sample of about 350 participants.