# Regression equation

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## Regression equation

An equation that describes the average relationship between a dependent variable and a set of explanatory variables.

Copyright © 2012, Campbell R. Harvey. All Rights Reserved.

## Regression Equation

In statistics, an equation showing the value of a dependent variable as a function of an independent variable. For example, a regression could take the form:

y = a + bx

where "y" is the dependent variable and "x" is the independent variable. The slope is equal to "b," and "a" is the intercept. When plotted on a graph, "y" is determined by the value of "x." Regression equations are charted as a line and are important in calculating economic data.

y = a + bx

where "y" is the dependent variable and "x" is the independent variable. The slope is equal to "b," and "a" is the intercept. When plotted on a graph, "y" is determined by the value of "x." Regression equations are charted as a line and are important in calculating economic data.

Farlex Financial Dictionary. © 2012 Farlex, Inc. All Rights Reserved

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