Deck 13: Regression Techniques

Question 1

Which of the following options is the best description of regression?

A) A mathematical equation describing the spread of values in a set of data
B) A mathematical equation testing whether changing one variable affects another
C) A mathematical equation describing the relationship between two variables
D) A mathematical equation describing the skewness of values in a set of data

Answer 1

A mathematical equation describing the relationship between two variables

Question 2

Which of the following options is an example of a non-causal relationship?

A) Salesman height and average monthly sales
B) Number of customers and revenue
C) Daily temperature and number of ice-creams sold
D) Income levels and average restaurant spend

Answer 2

Salesman height and average monthly sales

Question 3

A regression line is given by the equation y = 720 - 0.35x. Estimate the value for y when x equals 400.

A) 580
B) 640
C) 860
D) 1020

Answer 3

580

Question 4

A marketing officer wants to work out the relationship between the amount of money spent on social media and revenue increases. Which is the dependent variable in this case?

A) Social media spend
B) Revenue
C) There is no clear dependent variable
D) Both are dependent variables

Question 5

A regression line is constructed using data where the independent variable has values ranging between 20 and 130. What term is used when estimating a value of y when x = 85?

A) Extrapolation
B) Estimation
C) Interpolation
D) Causation

Question 6

What name is given to the regression line that allows a manager of a firm in Thailand to estimate the additional revenue generated for every additional 5,000 Thai Baht spent?

A) Output regression line
B) x on y regression line
C) y on x regression line
D) Input regression line

Question 7

Which of the following options is the best explanation of why the least squares method of fitting a regression line is preferred?

A) It is quick and easy
B) It allows for individual interpretation
C) It can be understood easily
D) It is mathematically derived

Question 8

A taxi-company owner in Kuala Lumpur has six cars of different ages. He records the annual cost of repairs (in Malaysian Ringgit). Using the data below, and the least squares method, work out the gradient (b) of the regression line (round to the nearest whole number).

A) 2659
B) 2682
C) 2696
D) 2702

Question 9

Which of the following options is NOT a way in which a regression line can be fitted to a set of bivariate data?

A) Inspection
B) Reduced means
C) Semi-averages
D) Least squares

Question 10

Which of these statements about extrapolation is NOT true?

A) The term is used to estimate a value for the dependent variable when the value used for the independent variable lies outside the observed range
B) Extrapolation is commonly used to support forecasting or planning for future needs (for example raw materials as production increases)
C) As extrapolation is taken from within the range of observed values we can be fairly confident of its accuracy
D) Extrapolation must be undertaken with care, particularly when values get further from the observed range