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Unit 13: Research and Statistics
Psycho Didi What is Regression Analysis wo o> Grvycno cia
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Regression analysis is a set of statistical methods used for the
estimation of relationships between a ea 5 Ww aa
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between variables and for modeling the future relationship
SRedidor GQ Rispanee.
Worn cle Jonna
Cotten oy
Vvomede re Simple Linear Regression
‘iso Known as bivariate regression analysis,
Svamables
‘Simple linear regression is a model that assesses the
relationship between a dependent variable (criterion.
variable) and an independent variable.(predictable
variable). The simple linear model is @xpressed using the
following equation
Y —Dependent variable
X — Independent (explanatory) variable
a— Intercept
b—Slope
E — Residual (error)
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Because you have two independent variables and one dependent variable, and all your variables are quantitative, you can
Use multiple linear regression to analyze the relationship between them.
‘Assumptions No wullacolgnanity
Muttiple linear regression makes all of the same assumptions as simple linear regression:
+ Homogeneity of variance (homoscedasticity): the size of the error in our prediction doesn't change significantly
‘across the values of the independent variable.
+ Linearity : the ine of bes fit through the data points isa straight line, rather than a curve or some sort of grouping
Tactor.
+ Normality: The data folows a normal dstibution
+ Independence of observations: the observations in the dataset were collected using statistically valid sampling
-methods, and the’e are no hidden relationships among variables.In multiple linear regression, it is possible that some
of the independent variables are actually correlated with one another, so itis important to check these before
developing the regression model. If two independent variables are too highly correlated (r2 > ~0.6), then only one of
them should be used in the regression model. Regression Coeffit b baz, bay Psycho Didi
[eur n bay
Regression coefficients determine the slope of the line which is the change in the jadependent variable for the unit
‘change in the independent variable. So they are also known as the slope coefficient.
punters ¢
Properties : lye tI >R= OF bye 8A
Itis generally denoted by bb Gt zy D>
itis expressed in the form of an original unt of data
it wo variables are there, say x and y, two values ofthe regression coeficient are obtained. One will be obtained
when xs independent and y is dependent and other when we consider y as independent and x as a dependent. The
regression coefficient of y on xis represented by byx and x on y as bxy
Both ofthe regression coefficients must have the same sign. If byxis positive, bxy wil also be postive and itis true for
vice versa
fone regression coefficient is greater than 1, then the other will be less than 2
They are not independent of the change of scale. There will be change inthe regression coefficient fx and y are
multiplied by any constant.
Asithmetic Mean of both regression coefficients is greater than or equal to the coeicient of correlation
Geometric Mean between the two regression coeffcients is equal tothe correlation coefcient. Use of Regression Analysis @ Psycho Didi
bX +E
1 It provides estimates of values of the dependent variables from values of
independent variables.
2. It is used to obtain a measure of the error involved in using the regression line as
a basis for estimation.
3. With the help of regression analysis, we can obtain a measure of degree of
4. Itis highly valuable tool in economies and business research, since
problems of the economic analysis are based dn.cause and effect relationship).
oredicoe
CEN,
prediction Correlation vs Regression
Basis For Comparison
Correlation
@ Psycho Didi
Regression
Meaning
Correlation is a statistical
‘measure that determines the
association or co
relationship between two
variables,
Regression describes how to
numerically relate an
Independent variable to the
dependent variable.
Usage
Dependent and independent
variables
To represent a linear
relationship between two
variables,
No difference
To fit the best line and to
estiniate one variable based
‘on another.
Both variables are different Correlation vs Regression
Correlation coefficient
Indicates Indicates the extent to which
two variables move together.
Tofind a numerical value,
Objective expressing the relationship
between variables.
@ Psycho Didi
Regression indicates the
impact of a change of unit on
the estimated variable ( y) in
the known variable (x)
To estimate values of
random variables on the
basis of the values of fixed
variables. MCQ TIME @ Psycho Didi
1. Linear regression uses. for graphical representation in
determining the strength of the relationship between two variables
.a. Histogram
b. Pie chart
ec Scatter diagram
d. Line graph IMCQ TIME @ Psycho Didi
2. In y=mx+c , cis called as
a. Gradient
b. Slope
e-Y-intercept
d. None of the above MCQ TIME @ Psycho Didi
3. In y=mx+c, mis called as slope, it is also called
> Gradient
b. Coefficient of Y-intercept
c. Y-intercept
d. None of the above a\ lp nye
A" @ Psycho Didi
MCQ TIME BA
4. if a regression coefficient is less than 1 then the other should be?
a. Equalto1
b. Less than1
c.0
._d:Greater than1 MCQ TIME
5. The coefficient of correlation is
,aGeometric mean
b. Harmonic mean
c. Arithmetic mean
d. None of these
@ Psycho Didi
of regression coefficient.
