Category: Simple Linear Regression

In the least-squares method, we square residuals and solve the corresponding optimization problem analytically. We should wonder what is so special with squared residuals. We might just as well take the absolute values of the residuals and solve Another noteworthy point is that in so doing we are essentially considering average values of squared or…

Consider the data tabulated and depicted in Fig. 10.1. These joint observations are displayed as circles, and a look at the plot suggests the possibility of finding a linear relationship between x and y. A linear law relating the two variables, such as1 can be exploited to understand what drives a social or physical phenomenon, and is one way of exploiting…

We take advantage of all the probabilistic and statistical knowledge we have built in the to get into the realm of empirical model building. Models come in many forms, but what we want to do here is finding a relationship between two variables, say, x and y, based on a set of n joint observations (xi, yi), i = 1,…,n.…