Probability, Statistics and Random Processes

12

Regression

Prerequisites

Before you start reading this unit, you should:

• Know the equation of a straight line
• Know the basic ideas of graphs

Learning Objectives

After going through this unit, you would be able to:

• Estimate the value of a random variable (the dependent variable) given that the value of an associated variable (the independent variable) is known
• Use the least squares estimating equation to predict future values of the dependent variable
• Learn limitations of regression
• Use the least squares method to calculate the equation of a regression line for a given set of data
• Understand the assumptions under which the regression analysis is carried out
• Evaluate as to how good the regression is?

12.1  REGRESSION

Let us first understand ...