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D) The semi-log specification of the linear regression model is chosen for computational convenience and does...

D) The semi-log specification of the linear regression model is chosen for computational convenience and does not change the interpretation of the estimated coefficients of the model. True or Fals

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Answer #1

False

Logarithmic transformation is usually used to pull outlying data from a positively skewed distribution closer to the bulk of the data in a quest to have the variable be normally distributed. The standard interpretation of coefficients in a regression analysis is that a one unit change in the independent variable results in the respective coefficient change in the expected value of the dependent variable while all the predicators are held constant.In the case of semi-log model, interpretation is different.The coefficient can be interpreted as approximately the percentage change in dependent variable given a unit change in independent variable.It's used to measure growth rate.

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