Essentials Of Investments
Essentials Of Investments
11th Edition
ISBN: 9781260013924
Author: Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher: Mcgraw-hill Education,
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In linear regression, compare independent and dependent variables.

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Step 1

Linear regression refers to a time series model in statistics that is used for predictive analysis. It assumes a linear relationship between the input & output variable. 

Step 2

The regression line uses the concepts of intercept and slopes. These statistical model shows how dependent variables depend on independent variables. 

Simple linear model is expressed as:

Finance homework question answer, step 2, image 1

Y is the dependent variable
X is the independent (explanatory) variable
a is the intercept
b is the slope

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