Logistic_regression.pptx - Logistic regression Dichotomous...

Info icon This preview shows pages 1–9. Sign up to view the full content.

View Full Document Right Arrow Icon
Logistic regression
Image of page 1

Info icon This preview has intentionally blurred sections. Sign up to view the full version.

View Full Document Right Arrow Icon
Dichotomous dependent variable Consumer’s decision: buy – not buy Outcome of an investment: success – failure Diagnosis: healthy – sick Will the client pay the loan back?: yes – no Final result of a student: pass - fail AIM: prediction of the membership
Image of page 2
Characteristics of a binary variable Values: 1 – belong to the category 0 – do not belong to the category Mean (relative frequency of the „preferred” outcomes) Variance 0;1 1 0 k n k k x p n n   2 2 2 0;1 1 0 1 k p n k p p p n
Image of page 3

Info icon This preview has intentionally blurred sections. Sign up to view the full version.

View Full Document Right Arrow Icon
Scattered plot How to fit any type of function to these point?
Image of page 4
Probabilities of even 1 Calculate the average of Y (the probability of „success”) in every point of X
Image of page 5

Info icon This preview has intentionally blurred sections. Sign up to view the full version.

View Full Document Right Arrow Icon
Employee’s decision based on the offered salary
Image of page 6
How does the model look like? Multiple regression models and the least squares criteria is unsufficient, because the dependent variable can not be normally distributed it is a non linear model values outside the range of 0-1 are unacceptable
Image of page 7

Info icon This preview has intentionally blurred sections. Sign up to view the full version.

View Full Document Right Arrow Icon
The logic of the model formulation P is the probability of success (event 1), but it can be only in the range of 0-1
Image of page 8
Image of page 9
This is the end of the preview. Sign up to access the rest of the document.

{[ snackBarMessage ]}

What students are saying

  • Left Quote Icon

    As a current student on this bumpy collegiate pathway, I stumbled upon Course Hero, where I can find study resources for nearly all my courses, get online help from tutors 24/7, and even share my old projects, papers, and lecture notes with other students.

    Student Picture

    Kiran Temple University Fox School of Business ‘17, Course Hero Intern

  • Left Quote Icon

    I cannot even describe how much Course Hero helped me this summer. It’s truly become something I can always rely on and help me. In the end, I was not only able to survive summer classes, but I was able to thrive thanks to Course Hero.

    Student Picture

    Dana University of Pennsylvania ‘17, Course Hero Intern

  • Left Quote Icon

    The ability to access any university’s resources through Course Hero proved invaluable in my case. I was behind on Tulane coursework and actually used UCLA’s materials to help me move forward and get everything together on time.

    Student Picture

    Jill Tulane University ‘16, Course Hero Intern