LINEAR/MULTIPLE REGRESSION:

APPLICATION & SAMPLE

PROBLEMS; COEFFICIENT OF
DETERMINATION

Ruben S. Ando MAED- Home Economics

Introduction
REGRESSION ANALYSIS is a form of predictive modelling
technique which investigates the relationship between a
dependent and independent variable.

This technique is used for forecasting, time series modelling

and finding the causal effect relationship between variables

Ex. Relationship between drunk driving and number of

road accidents by a driver.
 Regression Model
The REGRESSION LINE
is a single line that best fits
the data

The DEPENDENT
VARIABLE or the
EXPLAINED VARIABLE, The INDEPENDENT
is the variable to be VARIABLE or the
predicted. EXPLANATORY
VARIABLE, is a variable used
to predict another variable.

The RESIDUAL is the vertical

distance between a data point and
the regression line
Types of Regression Analysis
Has two
REGRESSIO Has two or
variables N more variables

SIMPLE MULTIPLE

NON- NON-
LINEAR LINEAR
LINEAR LINEAR
Simple Linear Regression
• In statistics, it is a linear regression model with a single
explanatory variable

• It estimates the relationship between the independent and

dependent variable using a STRAIGHT LINE.
Simple Linear Regression Model
Regression Equation is expressed as:

Slope for the Estimated y-intercept for the Estimated

Regression Equation Regression Equation
Positive Linear Relationship
Negative Linear Relationship
No Relationship
 Example:
Number of Number of REGRESSION MODEL EXAMPLE
TV Ads Houses 6

Sold
5
1 2

2 4 4

3 5
3

4 4
2
5 5
1

0
0.5 1 1.5 2 2.5 3 3.5 4 4.5 5 5.5
Determine the mean of the independent (x) and dependent Subtract the x values to its mean
(y) variable values

Square the difference of x and barred x. Multiply also the difference

Subtract the y values to its mean of the x and y values that were subtracted earlier to their means and
get the total of each
 Slope for the Estimated
Regression Equation
  6
𝑏1 = = 0.60
10
y-intercept for the
Estimated Regression
Equation

 𝑏 =4 − 0.60 ( 3 )= 2.2
0

Estimated Regression
Equation

 
ŷ=2.2
 Coefficient of Determination
• The coefficient of determination or R-SQUARED tells us how
well a regression line predicts or estimates actual values

Relationship between SST, SSR, and SSE

Example (continued)
Determine the mean of the dependent (y) Subtract the y values to its mean. Take note that the total should
variable values always be equal to 0

Square the difference and summarize   Using the estimated regression equation that was solved earlier,
ŷ=2.2,substitute x with its corresponding values
  3.6 2
𝑟 = = 0.6
6

,   it is a perfect fit

𝐼𝑓  𝑟 2 𝑎𝑝𝑝𝑟𝑜𝑎𝑐h𝑒𝑠𝑡𝑜 𝑧𝑒𝑟𝑜 , 𝑡h𝑒𝑟𝑒 𝑖𝑠 𝑛𝑜 𝑟𝑒𝑙𝑎𝑡𝑖𝑜𝑛𝑠h𝑖𝑝 𝑎𝑡 𝑎𝑙𝑙

𝐼𝑓 𝑟2 𝑎𝑝𝑝𝑟𝑜𝑎𝑐h𝑒𝑠𝑡𝑜0.9𝑖𝑡𝑖𝑠𝑎 𝑝𝑟𝑒𝑡𝑡𝑦𝑔𝑜𝑜𝑑𝑓𝑖𝑡

THANK YOU!