When should a researcher consider transforming the explanatory variable in a simple linear regression model?
A)when a data plot suggests there is a non-linear functional form
B)to get a coefficient estimate with the sign predicted by economic theory
C)to reduce the variation in the explanatory variable
D)to maximize SSR

Question

Quizplus · Accepted Answer

A researcher should consider transforming the explanatory variable in a simple linear regression model when a data plot suggests there is a non-linear functional form.

When Should a Researcher Consider Transforming the Explanatory Variable in a Simple