a) A model without intercept is a regression model that does not include a constant term. This type of model is typically used when the dependent variable is expected to be zero when all of the independent variables are zero. For example, a model without intercept could be used to predict the number of sales of a product based on the price of the product and the number of advertisements. In this case, the number of sales would be expected to be zero when the price and number of advertisements are both zero.
b) A log-linear model is a regression model in which the dependent variable is transformed using the natural logarithm. This type of model is typically used when the dependent variable is expected to have an exponential relationship with the independent variables. For example, a log-linear model could be used to predict the number of sales of a product based on the price of the product and the number of advertisements. In this case, the number of sales would be expected to increase exponentially as the price and number of advertisements increase.
Describe the following functional forms of a regression model clearly explaining under
what circumstances they can be suitably used. Give examples where possible.
a) A model without intercept.
b) A log-linearmodel.
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