We all know that the interpretation of coefficients in a semilogarithmic model are approximate only. So if
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Question:
We all know that the interpretation of coefficients in a semilogarithmic model are approximate only. So if we find, let’s say a coefficient on the independent variable X of 0.33, it is only approximately true that a one unit increase in X increases Y by 33%.
A) What would be the exact increase in Y? Explain using math and English.
B) What would be the exact increase in Y, if the model was fully logarithmic, with Y being preceded by a log function as well?
Related Book For
Principles Of Managerial Finance
ISBN: 978-0136119463
13th Edition
Authors: Lawrence J. Gitman, Chad J. Zutter
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