For the exponential model ln(y) = β₀ + β₁x + ε, if x increases by one unit, then E(y) changes by approximately A) β₁ × 100% B) β₁× 100 units C) β₁% D) β₁units

Question

Quizplus · Accepted Answer

Given the exponential model ln(y) = β₀ + β₁x + ε, an increase of one unit in x leads to a change in E(y) by a factor of e^(β₁), which can be approximated as (e^(β₁) - 1) × 100% for small β₁. Since β₁ corresponds to β₁₁ in the question, the correct answer is approximately β₁₁ × 100%.

For the Exponential Model Ln(y) = β0 + β1x

For the Exponential Model Ln(y) = β₀ + β₁x