You just explained to the client that your model doesn't capture interaction effects, and now they don't trust it. How do we deal with it?
Based on Experience
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How do you answer the question "But isn't everything interacting?" – learn how Multiplicative Models can help you find the answer!
Multiplicative Models
Most models assume the difference variables are independent, but in reality they often interact. Multiplicative models can help capture these non-linear effects. Read More
This Course Includes:
2 Chapters
19 Sections
2 Exercises
Completed in:
18 minutes
Course curriculum
Chapter
Description
Sections
Exercises
1. Is that a valid assumption?
Your client is upset about an assumption they didn't know their model was making: that ads don't perform differently during holidays. Do they have a point?
7
2. Log Linear and Log Log Models
Logarithms to the rescue: by taking the log you're going from adding terms together to multiplying them. This should satisfy the client's concern about interactions.
12
Frequently Asked Questions
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Discover how to solve this problem: But isn't everything interacting?