A linear regression to quantify the salaries of the employees in a company is estimated, using the following variables: Y: the salary of the employee in 1000 SEK. Age: the age of the employee in years R: the categorical variable Education with 3 groups; Primary, Secondary, University. a)Write down a linear model with intercept for the variable Y based on Age and R, in which the Primary level of education is the reference category for the Education variable. b)Mention a test to see if the variable Age significantly improves the model fit?
Correlation
Correlation defines a relationship between two independent variables. It tells the degree to which variables move in relation to each other. When two sets of data are related to each other, there is a correlation between them.
Linear Correlation
A correlation is used to determine the relationships between numerical and categorical variables. In other words, it is an indicator of how things are connected to one another. The correlation analysis is the study of how variables are related.
Regression Analysis
Regression analysis is a statistical method in which it estimates the relationship between a dependent variable and one or more independent variable. In simple terms dependent variable is called as outcome variable and independent variable is called as predictors. Regression analysis is one of the methods to find the trends in data. The independent variable used in Regression analysis is named Predictor variable. It offers data of an associated dependent variable regarding a particular outcome.
A linear regression to quantify the salaries of the employees in a company is estimated, using the following variables:
Y: the salary of the employee in 1000 SEK.
Age: the age of the employee in years
R: the categorical variable Education with 3 groups; Primary, Secondary, University.
a)Write down a linear model with intercept for the variable Y based on Age and R, in which the Primary level of education is the reference category for the Education variable.
b)Mention a test to see if the variable Age significantly improves the model fit?
Step by step
Solved in 3 steps
