Chapter 61 Modeling nonlinearities and interactions
Questions answered in this chapter:
What does it mean when we say that an independent variable has a nonlinear effect on a dependent variable?
What does it mean when we say that the effects of two independent variables on a dependent variable interact?
How can I test for the presence of nonlinearity and interaction in a regression?
Answers to this chapter’s questions
What does it mean when we say that an independent variable has a nonlinear effect on a dependent variable?
An independent variable often influences a dependent variable through a nonlinear relationship. For example, if you try to predict your product sales using an equation such as Sales=500–10*Price, the price influences sales ...
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