6

Regression Analysis

Regression analysis is a form of prediction modeling that uses selected input attribute values to predict an output value. The difference between classification (covered in Chapter 5) and regression analysis is in the output data type. In classification, the output or predicted type is nominal; in regression the predicted type is continuous numeric.

The Regression Model

A formal definition of the regression model is:

equation

where:

img is the value of the output variable for the img observation
img is the value of the first input variable for the img observation
img is the value of the img input variable for the img observation
is the random error term for the observation.

The error term is included ...

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