Regression analysis is a statistical method used to understand the relationship between one dependent variable and one or more independent variables. In simpler terms, it helps you see how changes in one thing affect another.
For example, you might use regression to see how advertising budget (independent variable) affects product sales (dependent variable).
The main goal of regression analysis is to build a model that can predict or explain outcomes. It answers questions like:
If I change X, what happens to Y?
How strong is the relationship between the variables?
Can I use this relationship to make future predictions?
There are different types of regression, but the most common is linear regression, where the relationship is shown as a straight line.
The regression equation is usually written as:
Y = a + bX + e
Where:
Y = dependent variable (what you’re trying to predict)
X = independent variable (the predictor)
a = intercept
b = slope (how much Y changes when X changes)
e = error term (random variation)