SIMPLE LINEAR REGRESSION

What is Linear Regression?

• You’re probably familiar with plotting line graphs with one X axis and one Y axis.
The X variable is sometimes called the independent variable and the Y variable is
called the dependent variable.

• Simple Linear Regression plots one independent variable X against one

dependent variable Y. Technically, in regression analysis, the independent variable
is usually called the predictor variable and the dependent variable is called the
criterion variable.

• However, many people just call them the independent and dependent variables.

ETYMOLOGY

• LINEAR means line. The word Regression came from a 19th Century Scientist, Sir
Francis Galton, who coined the term “regression toward mediocrity” (regression
toward the mean). He used the term to describe the phenomenon of how nature
tends to dampen excess physical traits from generation to generation (like
extreme height).

Linear implies the following: arranged in or extending along a straight or nearly

straight line. Linear suggests that the relationship between dependent and
independent variable can be expressed in a straight line.

What is the equation of a line?

• y = mx + c

Where:

• y is the dependent variable i.e. the variable that needs to be estimated and
predicted.

• x is the independent variable i.e. the variable that is controllable. It is the input.

• m is the slope. It determines what will be the angle of the line. It is the parameter
denoted as β.

• c is the intercept. A constant that determines the value of y when x is 0.

• The linear regression equation

• The first step in finding a linear regression equation is to determine if there is a

relationship between the two variables.

How to find a linear regression equation: steps

• Step 1: Make a chart of your data, filling in the columns in the same way as you
would fill in the chart if you were finding the Pearson’s Correlation Coefficient.

• Step 2: Use the following equations to find a and b.

• Step 3: Insert the values into the equation.