Lesson 4: Residual Analysis and R-Squared

January 26, 2017

Thu, Jan 26

Review:

• Linear Regression
• Exam 1 
  • Part 1 Take-Home (instructions provided in class on Tue Jan 31)
  • Part 2 In-Class (on Thu Feb 2)

Presentation:

• Residual Analysis
  • Individual Residuals (y – y-hat)
  • Residual Sum of Squares (SSE) = ∑(y – y-hat)²
  • Coefficient of Determination
    • R-Squared = 1 – SSE/SSyy
    • Relationship to Pearson Correlation Coefficient
    • Interpretation
• Example
  • Beer party data: {(60,10), (70,12), (80,20), (90,40)}
  • Calculate individual residuals
  • Calculate SSE
  • Calculate R-Squared

Activity:

• Calculate Individual Residuals, SSE and R-Squared
  • Use data and calculations from previous class
    • Data set 1: {(3,5), (5,8), (8,11), (12,10)}
    • Data set 2: {(50,12), (60,15), (70,20), (80,30)}
    • Data set 3: {(2,12), (4,9), (7,6), (11,3)}