STAT 102 Lecture 1: Lecture 8.28.docx
Document Summary
Goals: predict future y, what role does a given x play. Ex 1: y = price of diamonds, x=cut, color, clarity, carat. Ex 2: y = performance of stock, x = performance of market (simple regression, cap m regression) Ex 3: y = performance of players, x = fast ball or not, quality of pitcher. Ex 4: y=change in price of product in court case, x = price announcements, cost of raw materials. Abba"s principle #2: all formulas that are used to solve real world problems are based on assumptions.
