Chapter 11

Question 1

The Origin of a Lognormal Distribution

Answer 1

When factors
work in a
multiplicative
way.
• Double vs
cut in half
are equally
likely

Question 2

The logarithms of values from a lognormal

distribution will have a

Answer 2

Gaussian distribution.

Question 3

Geometric Mean

Answer 3

In this sample
from a lognormal
distribution, the
mean is not a
good measure of
central tendency.

Question 4

The geometric mean

Answer 4

is the antilog of the mean of
the logarithms. Transform all values to their
logarithms. Compute the mean of those logarithms.
Transform that mean back to the original units of the
data (calculate the antilog).

Question 5

Common Mistakes

Answer 5

Trying to take the log of zero or negative values.
• Misinterpreting a lognormal distribution as a
Gaussian distribution with an outlier.
• Difficult: need a theoretical reason for
interpreting as a lognormal.
• Inconsistently using different bases for logarithms.
• Be consistent: whichever log base is used, the
geometric mean with have exactly the same
value.