ECON 203 1st Edition Lecture 17Outline of Last LectureI. Inference Review Questions1. Z-test for Population ProportionA. Look for the Following Phrases2. F-test for Difference in VariancesA. Look for the Following Phrases3. Paired Sample t-test for Mean DifferenceA. Look for the Following Phrases4. F-test for Difference in MeansA. Look for the Following PhrasesOutline of Current LectureI. Simple Linear Regression and Correlation1. IntroA. Page 89, slide 32. Regression Analysis3. Comparing the two lines on the regression graphA. Line 1: Upward SlopingB. Line 2: HorizontalC. Smaller SumD. Page 90 slide 6Current LectureI. Simple Linear Regression and Correlation1. Intro- Regression analysis is the focus of this section- For now only using one independent variable to explain a dependent variable- Know the difference between the population and sample regression model equation!!A. On page 89 slide 3- An example of when two people study the same amount but they do not get the same scores on a test. These notes represent a detailed interpretation of the professor’s lecture. GradeBuddy is best used as a supplement to your own notes, not as a substitute.- When point B is higher than point A on the Y axis2. Regression Analysis- The point is to select the line that minimizes the sum of squared vertical differences between the points and the line- Also known as “ordinary least squares” (OLS) regression3. Comparing the two lines on the regression graph:A. Line 1: Upward SlopingSum of squared differencesTake the point minus the sloped line and square it!B. Line 2: HorizontalSum of squared differencesTake the points and subtract the horizontal y coordinate and square it!C. Smaller SumThe smaller the sum of squared differences = the better the fit of the line to the data. So choose the smaller number!D. See page 90 slide
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