Estimating Regression Parameters

While there are statistical packages that allow us to input data and get the regression parameters as output, it is worth looking at how they are estimated in the first place. The slope of the regression line is a logical extension of the covariance concept introduced in the last section. In fact, the close linkage between the slope of the regression and the correlation/covariance should not be surprising since the slope is estimated using the covariance -

Slope of the Regression = b

Covariance

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