0 Regression Key Concepts

0 Regression Key Concepts - Dr. Harvey A. Singer School of...

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© 2008 by Harvey A. Singer 1 OM 210 Statistical Analysis for  Management Simple Linear Regression and Correlation Regression Key Concepts Dr. Harvey A. Singer School of Management George Mason University
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© 2008 by Harvey A. Singer 2 The Equation of the Regression Line = y -intercept of the regression line = slope of the regression line Y i = b 0 + b 1 x i The value of y Sample y -intercept Sample Slope Coefficient
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© 2008 by Harvey A. Singer 3 Regression Coefficients b 0 is the vertical-axis intercept of the line. b 0 is the height above (if > 0) or below (if < 0) the horizontal axis where the regression line crosses the vertical axis. b 0 is the calculated Y value for which x = 0. b 1 is the slope (or inclination) of the regression line. b 1 is the mean rate of the fitted linear trend. • Both b 0 and b 1 are both calculated from all the observed data, with all of its variability. – Calculate b 1 first. – Then calculate b 0 using the calculated b 1 .
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© 2008 by Harvey A. Singer 4 The Slope b 1 • Short-cut calculation of b 1 : 2 1 2 1 x n x y x n y x n i i n i i i - - = = = b 1
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© 2008 by Harvey A. Singer 5 The y -intercept b 0 b 0 = y b 1 x • With the value just calculated for b 1 :
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© 2008 by Harvey A. Singer
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0 Regression Key Concepts - Dr. Harvey A. Singer School of...

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