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Simple_Linear_Regression_Model

The simple linear regression model establishes a relationship between a dependent variable y and an independent variable x through the equation y = b0 + b1*x + e. Coefficients b0 and b1 are estimated using the Least Squares Method to minimize the sum of squared residuals. The slope indicates the change in y for a one-unit change in x, while the intercept represents the expected value of y when x is zero.

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3 views

Simple_Linear_Regression_Model

The simple linear regression model establishes a relationship between a dependent variable y and an independent variable x through the equation y = b0 + b1*x + e. Coefficients b0 and b1 are estimated using the Least Squares Method to minimize the sum of squared residuals. The slope indicates the change in y for a one-unit change in x, while the intercept represents the expected value of y when x is zero.

Uploaded by

bmalavika970
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as PDF, TXT or read online on Scribd
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Simple Linear Regression Model

1. Model Equation

Model Equation:

A simple linear regression model relates a dependent variable y to one independent variable x as:

y = b0 + b1*x + e

Where:

- y: Dependent variable

- x: Independent variable

- b0: Intercept (value of y when x = 0)

- b1: Slope (change in y for a one-unit change in x)

- e: Error term (captures variability not explained by the model)

2. Estimating Coefficients

Estimating the Coefficients b0 and b1:

We estimate the coefficients using the Least Squares Method, which minimizes the sum of squared residuals:

Residual = yi - (b0_hat + b1_hat*xi)

Objective: Minimize

S = Sum[(yi - b0_hat - b1_hat*xi)^2]

Solving gives:

b1_hat = Sum[(xi - x_mean)*(yi - y_mean)] / Sum[(xi - x_mean)^2]


Simple Linear Regression Model

b0_hat = y_mean - b1_hat*x_mean

3. Interpretation

Interpretation of Coefficients:

Suppose we are analyzing the relationship between hours studied (x) and test scores (y):

- b1_hat = 5: For every additional hour studied, the test score increases by 5 points.

- b0_hat = 50: If a student studies 0 hours, their predicted score is 50 (may or may not be meaningful).

Summary:

- The simple linear regression model provides a linear relationship between two variables.

- Coefficients are estimated by minimizing the sum of squared errors using Least Squares Method.

- The slope represents the effect of the independent variable on the dependent variable.

- The intercept represents the expected value of the dependent variable when the independent variable is

zero.

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