LO
Specify a multiple linear regression model
Describe the output of a multiple linear regression model
Interpret the output of a multiple linear regression model in business terms
Assess whether the assumptions of multiple linear regression are met
Discuss the implications of ‘overfitting’ a predictive model
Use SAS Visual Analytics (SAS VA) to build a predictive model with multiple linear regression.

Predictive models

Simple linear regression

Running a simple regression with SAS VA

Examining the detail output produced by SAS VA

Test statistics
T=variance explained by the model/variance not explained by the model

Degrees of freedom
Degrees of Freedom = sample size – 1

Variance explained and goodness of fit
R2=SSm/SSt

Multiple linear regression

Extending the regression model
categorical variables/interaction effects