QMB-210 Lecture 24: QMB 210 Lecture 24: Chapter 14: Regression/ Correlation analysis/ R values/ Linear regression model/ Prediction lines/ SSR, SSE, SST/ Examples
9 Jun 2017
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An independent variable, x, explains the variation in another variable, which is called the dependent variable, y. Variation in x explains variation in y, but not the reverse (direction is only one way: independent variable (x) dependent variable (y) Correlation analysis is used to measure both the strength and direction of a linear relationship between two variables. A relationship is linear if the scatter plot of the independent and dependent variables has a straight-line pattern. E. g. a positive relationship when x increases, y also increases: the more you study the higher your grade. Simple linear regression = 1 x variable at a time. The simple linear regression model for a population: where: yi = the i th observation for the dependent variable from the population. 0 = the population y-intercept (the value of y when x is zero) Formula for the equation describing a straight line through ordered pairs:
