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In Ordinary Least Squares Regression, the gap between the value of the dependent variable and the...

In Ordinary Least Squares Regression, the gap between the value of the dependent variable and the predicted value is called Question 2 options: A) the minimizing coefficient. B) the residual. C) the error term. D) the explanatory variable.

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Answer #1

The correct answer is (B) the residual.

According to definition of residuals, residual is the the gap between the value of the dependent variable and the predicted value in Ordinary Least Square.

Hence, the correct answer is (B) the residual.

Note :

Sometimes We gets confused between Residual and error. Error is the difference between True Value and observed value while Residual is the difference between Observed Value and Predicted value(like in a regression).

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