Simple linear regression refers to the statistical technique of analyzing the relationship between two quantitative variables whereby one of the variables is independent while the other is dependent. The independent variable is also referred to as a predictor variable, while the dependent variable is also termed as a response or an outcome (Pennsylvania State University, n.d.). The simple linear regression is denoted as “simple” because it only has one predictor variable (Boston University, n.d.). The number of independent variables differentiates simple linear regression and multiple linear regression. The simple linear regression has only one independent variable, while the multiple linear regression has two or more independent variables (Pennsylvania State University, n.d.).
A dependent variable is a variable in a linear regression equation whose value is dependent on another variable (the independent/predictor). An independent variable is the variable in a linear regression equation whose value is not determined by another variable. The independent variable is the predictor variable in a linear regression equation; it determines the dependent variable’s value.
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In the real estate example, the independent variables are the size, location, condition, and # of bedrooms. The dependent variable is the home’s selling price. The home’s selling price is the dependent variable since it is determined/predicted by the predictor variables, size, location, condition, and # of bedrooms.
In institutions, municipalities, or cities, regression analysis is applied in the design of sewer lines and wastewater treatment plants. The size of the sewer lines or treatment plants is usually the dependent variable in the regression equations, while the current population, projected population growth rate, type of households, etc. are the independent variables. The second example depicting the utilization of regression analysis involves the prediction of the direct revenue in shopping malls. The direct revenue is the dependent variable in the regression analysis since it is determined by a number of independent variables such as the number of shoppers frequenting the malls and their shopping patterns.
References
Boston University. Simple linear regression . Sphweb.bumc.bu.edu. Retrieved 5 November 2020, from https://sphweb.bumc.bu.edu/otlt/MPH-Modules/BS/R/R5_Correlation-Regression/R5_Correlation-Regression4.html .
The Pennsylvania State University. 2.1 - What is simple linear regression? | STAT 462 . Online.stat.psu.edu. Retrieved 5 November 2020, from https://online.stat.psu.edu/stat462/node/91/ .
