Chapter 12 Regression Line

y= slope x (x) + intercept (x=0)

 Formula for slope 

To find out the slope of y you must know the average income and SD of y and x values

example:

• (x) Average education = 12.5 ,  SD = 3Average
• (y) Income = 30,000, SD = 24,000
• r=.25

 = 2,000

to find the value of y when x =0

12.5 (Ave of x) 2000 = 25,000 

were going to subtract 25,000 from the average y; to get y when x =0

30,000-25,000 = 5000

Predicted Income =  x (x-value) + (y when x=0)

• Note:
• to find the value of y when x =0 

• Slope Formula x (x average) =z 
• y-z = y when x = 0

regression line also called least squared line, make rms error as small as possible