Statistical Literacy


David Lane

Stock Appreciation



Many financial web pages give you the option of using a linear or a logarithmic Y-axis. An example from Google Finance is shown below.

stock appreciaion

What do you think?

To get a straight line with the linear option chosen, the price would have to go up the same amount every time period. What would result in a straight line with the logarithmic option chosen?

Housing Appreciation

The graph at the top of this page states that the prices are shown in a logarithmic scale.

What do you think?

The Y-axis values do not appear to be a log scale. Interpret the scale for the Y-axis.

Please answer the questions:
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