2/3/2021 Multiple Linear Regression | Six Sigma Study Guide

Multiple Linear Regression

Posted by Ramana PV

What is Multiple Linear Regression?

Multiple linear regression is an extension to methodology of simple linear regression. Simple linear regression is to study

the two variables in which one variable is independent variable (X) and the other one is dependent variable (Y). In other

words predict the change in dependent variable according to change in independent variable

When to Use Multiple Linear Regression

Multiple linear regression is to study more than two variables. In fact the basic difference between simple and multiple

regression is in terms of explanatory variables. In multiple regression unlike simple linear regression there are more than

one independent variable (X), these independent variables used to predict a single dependent variable(Y). Predict the

change in dependent variable (Y) according to change in independent variables.

Example: The house price (Dependent variable Y) depends on the various Independent variables (X) like locality, number of

bed rooms, number of bathrooms, age of the house and also square foot of the house.

Notes about Multiple Linear Regression

Y is the linear transformation of the X variables and subjected to the condition that the sum of squared deviations of the

observed and predicted Y is minimized, in other words the sum of squared errors is minimized

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Residual also called error is the difference between the actual observed values of dependent variable Y and the predicted

values that we get as a linear transformation of the X variables.

The coef cient of determination is R2. It is the proportion of the explained variation divided by the total variation. When

numbers of predictors are adding to the model then R2 will also increases, despite the fact that predictors have no relation

with output variable.

Likewise r2 (the linear coef cient of determination) R2 (the multiple coef cient of determination) take values in the interval:

0≤ R2 ≤1

If the value of R2 is 0 then outcome cannot be predicated, where as if R2 is 1 outcome can be predicated and it is error free

from the independent variables (X), but same it does not mean a great model

The computation in case of multiple regression is complex due to the number of explanatory variables in the model.

However because of interrelationship among the variables the interpretation also changes accordingly

Assumptions of Multiple Linear Regression

Independent Residuals

No Multicollinearity – Not too high correlation between the independent variables

Residuals must be normally distributed

Furthermore relationship between each predictor variable and the outcome variable is linear

Formula to calculate Multiple Linear Regression

A rst order linear model

The formula for two independent variables the prediction of Y is

Y= β0+β1X1+β2X2 +…….. βkXk + ε

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Where

Y is dependent variable

X is independent variable

β0 is Y intercept

ε is residual also called error

βk slope coef cient for each independent variable

β can also be compute in a such a way that minimizes the sum of squared errors

ANOVA Table for Multiple Regression

Where k is the number of predictor variables

And estimated regression line shall be y = b̂0+b̂1X1+b̂2X2

Formulas to calculate estimates of parameters betas’

b̂0 = Y̅-b̂1X̅1– b̂2X̅2

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A Second –Order Linear Model (Two Predictor Variables)

Y= β0+β1X1+β2X2+ β3 X1X2+ β4 X12++ β5 X22+ε

Example of Multiple Linear Regression in DMAIC

Multiple Linear Regression will be used in Analyze phase of DMAIC to study more than two variables. In a laboratory

chemist recorded the yield of the process which will be impacted by the two factors. Chemist wants to model the rst order

regression.

Y̅ =354/8=44.25

p̅=61/8=7.625

q̅=38/8=4.75

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b̂0 = Y̅-b̂1p̅- b̂2q̅ =31.37

The estimated regression line would be

y = 31.37+0.75p+1.5q

Multiple Linear Regression Videos

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Stats 35 Multiple Regression

Additional Resources
Multiple Regression presentation

Six Sigma Green Belt Multiple Linear Regression

Questions

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Questions, comments, issues, concerns? Please leave a note in the comments below!

Question: A ____________________ is used to create a model of the affect on an output by the variation in two or more of the

inputs.

(A) Correlation Coef cient

(B) Anova

(C) Multiple Regression

(D) X-Y Diagram

Contributors

Ramana PV

This entry was posted in Analyze and tagged ASQ, Black Belt, IASSC. Bookmark the permalink.

Comments (4)

Fiaz
July 19, 2020 at 3:46 am

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2/3/2021 Multiple Linear Regression | Six Sigma Study Guide

Excellent presentation

Reply

Ted Hessing
July 19, 2020 at 7:21 am

Glad it is helpful, Fiaz.

Reply

Mohammad Najjar
October 6, 2020 at 10:50 am

This is great walkthrough.. thank you so much.

Reply

Ted Hessing
October 6, 2020 at 10:59 am

You’re very welcome, Modammad. Glad it helps!

Reply

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