BMT - simple linear regression

What does simple linear regression show?

The relationship between two variables e.g., weight in correlation to height. These are shown in scatter diagrams

What are the correlations of data on a scatter diagram?

Strong positive, weak positive, strong negative, weak negative, no correlation

What is the line of best fit?

Drawing a straight line through the middle of the points on a scatter diagram, which reveals the trend

What is extrapolation?

A technique which estimates data values beyond original data set, based on previous data. It can be used to forecast future trends

What is correlation vs causation?

It shows two variables may have a correlation, however, that doesn’t mean that one variable is the cause of another, or that they are related. For example, ice cream sales may increase with homicide rates, but that doesn’t imply causation, it just shows correlation

Advantages of simple linear regression?

Extrapolation can be used to predict trends in the future

It is easy and simple to interpret

What are disadvantages of simple linear regression?

Data must be accurate and reliable

Outliers / anomalies can distort results

Seasonal fluctuations can make it difficult to determine correlation (e.g., sunscreen, clothing)

Random variations can lead to outliers (e.g., war, natural disaster)