In the practical example, why is the nonlinearity fixed just by logging the variable Y (price)? Would it improve if the other variables / features were also logged?

Hi Marta, The opposite mathematical concept of a logarithm is an exponent. Therefore, when you are observing a relationship which is exponential, you can apply a log transformation to reach a linear relationship. Alternatively, if you are observing a log transformation, you can apply an exponential transformation to reach a linear relationship. Note that a linear regression requires a linear relationship and that is why we are trying to achieve it! Best, The 365 Team

Follow this topic

Marta

Last answered:

07 May 2020

Posted on:

04 May 2020

when to know to which variables should the log transformation be applied ?

1 answers ( 0 marked as helpful)

365 Team

Instructor

Posted on:

07 May 2020

when to know to which variables should the log transformation be applied ?

Submit an answer