《泰康健康人生重大疾病终身保障计.ppt

Slides by JOHN LOUCKS St. Edward抯 University Chapter 12 Simple Linear RegressionPart A Simple Linear Regression Model Least Squares Method Coefficient of Determination Model Assumptions Testing for Significance Simple Linear Regression Model y = b0 + b1x +e where: b0 and b1 are called parameters of the model, e is a random variable called the error term. The simple linear regression model is: The equation that describes how y is related to x and an error term is called the regression model. Simple Linear Regression Equation The simple linear regression equation is: E(y) is the expected value of y for a given x value. b1 is the slope of the regression line. b0 is the y intercept of the regression line. Graph of the regression equation is a straight line. E(y) = b0 + b1x Simple Linear Regression Equation Positive Linear Relationship E(y) x Slope b1 is positive Regression line Intercept b0 Simple Linear Regression Equation Negative Linear Relationship E(y) x Slope b1 is negative Regression line Intercept b0 Simple Linear Regression Equation No Relationship E(y) x Slope b1 is 0 Regression line Intercept b0 Estimated Simple Linear Regression Equation The estimated simple linear regression equation is the estimated value of y for a given x value. b1 is the slope of the line. b0 is the y intercept of the line. The graph is called the estimated regression line. Estimation Process Regression Model y = b0 + b1x +e Regression Equation E(y) = b0 + b1x Unknown Parameters b0, b1 Sample Data: x y x1 y1 . . . . xn yn b0 and b1 provide estimates of b0 and b1 Estimated Regression Equation Sample Statistics b0, b1 Least Squares Method Least Squares Criterion where: yi = observed value of the dependent variable for the ith observation ^ yi = estimated value of the dependent variable for the ith obse