📘 Lesson Title: Different Types of Models
❓ Models Based on Questions They Answer
Regression Models answer “how much” or “how many”
questions; they produce numerical outputs.
o Example: Predicting sales numbers or stock prices.
Classification Models answer categorical questions — “which
group/class does this belong to?”
o Can be binary (e.g., yes/no, true/false) or multiclass (e.g., dog,
cat, human).
o Used in healthcare (diagnosis), marketing (churn prediction),
etc.
Clustering Algorithms group data into similar segments based on
patterns — no predefined labels.
o Used for market segmentation, audience targeting, and
sociological research.
o Can uncover natural groupings like “young urban professionals”
or “new parents.”
🔁 Three Key Model Types by Algorithm
1. Linear Regression
A simple model best for finding linear trends.
Data-light (doesn’t need much data), but limited to basic
relationships.
2. Decision Trees
Use a tree-like branching logic with a series of if-then decisions.
Can handle both classification and regression problems.
Random Forest: a combination of multiple decision trees for better
accuracy.
Good for credit scoring, risk assessment, and low-complexity
environments.
3. Neural Networks
Composed of layers of artificial “neurons” that model complex
relationships.
Require large datasets and high computing power.
Common in AI, image recognition, autonomous vehicles, and
generative tools.
🔑 Final Takeaways
Choosing the right model depends on:
o The question being asked
o The type and volume of data
o Computational resources
o The complexity of the relationships
The effectiveness of a model is tied to its suitability for the task.
📍 Understanding model types—regression, classification, clustering—and
selecting the right algorithm (e.g., linear regression, decision trees, neural
networks) is critical to effective data analysis and prediction.
Common Model Types
Regression Models
Predict ‘How much’ or ‘how many’
Classification Models
Predict class or category a datapoint belongs to
Clustering Models
Identify groups of similar records in your data