Which of the Following Correctly Identifies a Limitation of Logarithmic

question 19

Multiple Choice

Which of the following correctly identifies a limitation of logarithmic transformation of variables?

• A)Taking log of variables make OLS estimates more sensitive to extreme values in comparison to variables taken in level.
• B)Logarithmic transformations cannot be used if a variable takes on zero or negative values.
• C)Logarithmic transformations of variables are likely to lead to heteroskedasticity.
• D)Taking log of a variable often expands its range which can cause inefficient estimates.

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Definitions:

Node

A point in a network where pathways intersect or branch, also used to refer to devices like computers or other endpoints on a network.

Data Packets

Small blocks of data transmitted over a network, each containing both payload (the actual data) and control information.

Router

A networking device that forwards data packets between computer networks, directing traffic on the Internet by at least analyzing its network address.

Network Infrastructure

The hardware and software resources of an entire network that enable network connectivity, communication, operations, and management.