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Homework Statement
Salaries of NBA players related to average points per game:
Salary = 1 500 000 + 0.9log(points), n = 150, r^2 = 0.14
1) What is a bad players salary? 2) Interpret the coefficient in front of the aggressor 3) What would be the advantages of running it in log-log form?
Homework Equations
Salary = 1 500 000 + 0.9log(points), n = 150, r^2 = 0.14
The Attempt at a Solution
1) Approx 1 500 000. The lower the average points, the closer the salary is to 1 500 000
2) It is the right sign, as an increase in points means an increase in salary. But it is too small;
3) The main advantage is that the coefficient would give the elasticity; the elasticity would be 0.9.