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The use of regression analysis as it relates to the improvement of forecasting. Answer the following...

The use of regression analysis as it relates to the improvement of forecasting. Answer the following question: What are some ways companies in the real-world do this? You can show actual information put out by a business, or you can use a news article to explain this, but please also reference the textbook as you do so.

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Regression analysis is used in various ways in the real world. Businesses are able to evaluate Trends and make sales estimates based on linear regression. Linear regression establishes a relationship between two variables and shows the relation as an equation by which one variable can be forecasted.

Linear regression can also be used to analyse the effect of changes in price of a product. So if the relationship is between sales and price the company can make a forecast about sales depending on what price they plan for their product. It can hence be used to analyse risk. For instance an insurance company can use linear regression for making a relationship between the age of customers and their number of claims. It can also be used to optimize the operattions of the business and supports decision making.

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