Question

In simple linear regression, describe (in words) how the parameters of the equation of the line (i.e., bo and b1) are determined?

Answer 1

Let x be the independent variable and y be dependent variable.

Regression equation is

where the parameter is intercept and is slope of regression line.

We can find b0 and b1 using below formuale:

where n is total number of observations for x or y.

or

where is sampl mean of y and is sample mean of x.