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Question with regards to taking the logarithm of a variable (Statistics Question)

Say you have a bar graph displaying data for an example "Cost of Computer Orders by the Population" and you are trying to analyze the data and find a distribution. The information does not indicate anything so you take the logarithm of the variable and the graph then resembles a normal distribution. I know that the normal distribution basically means the mean, but what does taking the logarithm of the information indicate?

Masterminder
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2 Answers2

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It seems that you are describing the lognormal distribution: a random variable is said to come from a lognormal distribution if its logarithm is distributed normally.

In practice, this can describe processes where the value cannot go below zero, and most of the population is close to the left (right skewness). For example: salaries, home prices, bone fractures, number of girlfriends all could be reasonably modeled with a log normal distribution.

For example: say that on average young adults have had 2.5 girlfriends. A few have never had one; you cannot have "negative number" of girlfriends, and a few bastards have had 25. However, most young adults will have had between, say, one and three.

Escualo
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if you display the values of x as their log(x) then the line in the diagramm is a straight line, when the values grow exponential. This is a stastistically trick for a fast check if values grow exponentionally.

AlexWien
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