Question

What is the standard error of the estimate and what does it represent? Give three reasons why this is useful in statistics.

Answer 1

Standard error of estimate is a standard deviation of estimate. For example

Three reasons why standard error is useful in statistics:

1. As standard error is small, width of confidence interval is also small and so we estimate unknown parameter with more accurately.

2.  Large standard error implies that there is a lot of variability in the population. A small standard error means that the population is more uniform, so the sample mean is likely to be close to the population mean.

3. When we consider regression analysis, the standard error of the estimate is a measure of the accuracy of predictions.