Ch. 8 Notes
Ch. 8 Notes
Errors = residuals =
Used to …
Definition: minimizes…
Form:
Pieces:
b1 =
b0 =
always …
not
on calculator:
Example:
A real estate agent studied the relationship between house prices and size (square footage). He found the least-
squares regression line to be: Selling Price = 51912.73 + 47.734(Square Feet).
Extrapolation-
Coefficient of Determination-
symbol:
sentence interpretation:
RESIDUALS
Residuals (errors):
Residual Plot:
Definition:
EXAMPLES:
Original plot residual plot
Helps…
No pattern = scattered =
Pattern =
On calculator:
An insurance company conducts a survey of 15 of its life insurance agents. The average number of minutes spent
with each potential customer and the number of policies sold in a week are noted for each agent.
The following is a printout from the statistical analysis tool on Microsoft Excel.
1. What is the equation of the LSR line relating minutes spent and policies sold.
The following is a MINITAB regression printout relating average number of degree-days per month to gas
consumption (in cubic feet).
1. What is the equation of the LSR line relating degree days to gas consumption?
Example 3: