Scribd
Upload
8 views

Aba Exam Regression

NN

Uploaded by

Abhishek Ajith
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd
8 views

Aba Exam Regression

NN

Uploaded by

Abhishek Ajith
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd
You are on page 1/ 5

1.

REGRESSION ANALYSIS

Meaning:
Regression analysis is a form of predictive modeling technique used to
forecast the business using suitable datasets. It is used to eliminate the
relationship between the variables like independent and dependent
variable. It also helps to predict the value of dependent variable based on
at least one independent variable. It explains the impact of changes with
independent variable on a dependent variable.

Types of Regression Analysis:

1) Linear regression analysis is used to predict the value of a


variable based on the value of another variable. The variable you
want to predict is called the dependent variable. The variable you
are using to predict the other variable's value is called the
independent variable.

2) Multiple regression analysis is a statistical technique that analyzes


the relationship between two or more variables and uses the
information to estimate the value of the dependent variables. In
multiple regression, the objective is to develop a model that
describes a dependent variable y to more than one independent
variable.

Functions of Regression Analysis

1) Prediction and Forecasting

Regression is widely used to predict the value of a dependent variable


based on the values of one or more independent variables. For example:

o Predicting sales based on advertising expenditure.


o Forecasting stock prices using past trends.

2) Understanding Relationships

It helps in understanding the strength and type of relationship (positive,


negative, or no relationship) between dependent and independent
variables.
o Example: Analyzing how customer satisfaction (dependent
variable) is influenced by service quality (independent variable).

3) Quantifying Impact

Regression quantifies how much a change in an independent variable


affects the dependent variable.

o Example: Determining how much a 1% increase in marketing


spend increases revenue.

4) Hypothesis Testing

It tests hypotheses about relationships between variables. For instance:

o Does education level significantly impact income levels?


o Are advertising efforts effective in driving sales?

5) Modeling Complex Relationships

Regression, especially multiple regression, can model complex


relationships involving multiple predictors.

o Example: Understanding how age, income, and education together


influence purchasing decisions.

6) Error Minimization

Regression provides an optimal line or equation that minimizes the error


between observed and predicted values.

7) Decision-Making Support

Regression outputs, such as coefficients and statistical significance, help


in decision-making. For example:

o Identifying key factors to prioritize in resource allocation.

8) Control Variables

It helps control for confounding variables, isolating the effect of one


predictor while holding others constant.
2. How data cleansing, handling outliers and missing values impact the
business scenario in the organization?

Data cleansing, handling outliers, and managing missing values are critical
processes in data analysis and have a profound impact on business scenarios
within an organization. Here's how these practices influence organizational
outcomes:

1. Improved Decision-Making

 Impact: Clean and accurate data enables better business decisions.

Example: A sales team using cleaned data can accurately identify


high-value customers and target them effectively.

 Consequence of Neglect: Incorrect decisions due to unreliable data can


lead to financial losses and reduced market competitiveness.

2. Enhanced Predictive Accuracy

 Impact: Removing outliers and handling missing values improve the


performance of predictive models.

Example: A machine learning model predicting customer churn


will be more reliable with high-quality input data.

 Consequence of Neglect: Outliers can skew results, leading to incorrect


predictions and misaligned strategies.

3. Resource Optimization

 Impact: Accurate data minimizes wastage of resources by preventing


inefficiencies.

Example: Clean inventory data ensures optimal stock levels,


reducing overstocking or stockouts.

 Consequence of Neglect: Poor data can cause resource misallocation,


leading to increased costs.

4. Regulatory Compliance
 Impact: Accurate and cleaned data helps organizations comply with
regulatory requirements and avoid legal issues.

Example: In finance, missing or incorrect records can lead to


regulatory penalties.

 Consequence of Neglect: Dirty data might result in non-compliance fines


or reputational damage.

5. Customer Satisfaction

 Impact: Clean data ensures personalized and accurate customer


interactions.

Example: A telecom company using clean data can effectively


address customer complaints and optimize service.

 Consequence of Neglect: Incorrect or incomplete customer data can lead


to dissatisfaction and churn.

6. Strategic Insights

 Impact: Identifying and addressing outliers ensures that strategic


decisions are based on true trends and patterns.

Example: Anomalies in sales data might indicate fraud or


operational issues; addressing them reveals actual performance.

 Consequence of Neglect: Decisions based on flawed data might overlook


critical opportunities or threats.

7. Cost Savings

 Impact: Handling missing values and anomalies avoids the need for
costly re-analysis or rework.

Example: Early identification of errors in financial data saves time


and effort in audits.

 Consequence of Neglect: Errors might require expensive corrections or


lead to project delays.

8. Credibility and Trust


 Impact: Clean data builds trust among stakeholders, including customers,
partners, and employees.

Example: Investors are more likely to trust and invest in a business


that demonstrates data reliability.

 Consequence of Neglect: Inaccurate data damages an organization’s


reputation and erodes stakeholder confidence.

You might also like