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Regression Models and Dependent Variables

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One of the assumptions for regression models is that the dependent variable must be at least interval scale data. Can you please explain why.
And A local company wanted to predict the weekly sales based on the weekly newspaper advertising dollars. The model that result is: ŷ= -0.1 + 0.7x, where the dependent variable is the amount of sales realized during the week and the independent variable is the amount spent on newspaper advertising during the week. Interpret the meaning of the values "-0.1" and "0.7" in the context of the problem. Please explain in relating to an example easy to understand.

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The expert examines regression models and dependent variables.

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The regression analysis is done to correlate the dependent variable with independent variable. for this purpose, we take a model (say linear relation) of relation between two variables (dependent and independent) and do the analysis on given data. How model is good, depends on the chi-square value,i.e., the indicator of deviation of ...

Solution provided by:
Amrit Lal Ahuja, PhD (IP)
Education
  • BEng, Allahabad University, India
  • MSc , Pune University, India
  • PhD (IP), Pune University, India
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