Solved

To Decide Whether Yi=β0+β1X+ui or ln(Yi)=β0+β1X+uiY _ { i } = \beta _ { 0 } + \beta _ { 1 } X + u _ { i } \text { or } \ln \left( Y _ { i } \right) = \beta _ { 0 } + \beta _ { 1 } X + u _ { i }

Question 3

Multiple Choice

To decide whether Yi=β0+β1X+ui or ln(Yi) =β0+β1X+uiY _ { i } = \beta _ { 0 } + \beta _ { 1 } X + u _ { i } \text { or } \ln \left( Y _ { i } \right) = \beta _ { 0 } + \beta _ { 1 } X + u _ { i }
fits the data better, you cannot consult the regression R2 because


A) ln (Y) may be negative for 0<Y<1 .
B) the TSS are not measured in the same units between the two models.
C) the slope no longer indicates the effect of a unit change of X on Y in the log-linear model.
D) the regression R2R ^ { 2 } can be greater than one in the second model.

Correct Answer:

verifed

Verified

Related Questions

Unlock this Answer For Free Now!

View this answer and more for free by performing one of the following actions

qr-code

Scan the QR code to install the App and get 2 free unlocks

upload documents

Unlock quizzes for free by uploading documents