- CFA Exams
- 2025 Level II
- Topic 1. Quantitative Methods
- Learning Module 2. Evaluating Regression Model Fit and Interpreting Model Results
- Subject 3. The Use of Multiple Regression for Forecasting
Why should I choose AnalystNotes?
Simply put: AnalystNotes offers the best value and the best product available to help you pass your exams.
Subject 3. The Use of Multiple Regression for Forecasting PDF Download
Predicting the value of the dependent variable using an estimated multiple regression model is similar to that in simple regression. First, sum, for each independent variable, the estimated slope coefficient multiplied by the assumed value of that variable, and then add the estimated intercept coefficient.
Example
A multiple regression analysis yields the equation y-hatt = -3.8 + 2.34 X1t + 7.52 X2t. If
- The value of the X1t independent variable is 6, and
- The value of the X2t independent variable is 2.
What is the predicted value of the dependent variable?
Answer: The predicted value of the dependent variable is -3.8 + 2.34 x 6 + 7.52 x 2 = -3.8 + 14.04 + 15.04 = 25.28.
User Contributed Comments 3
User | Comment |
---|---|
pb09 | I wish the rest of quant was this easy! |
zed889 | amen |
Cfrey | Glad AN has the bookmark feature |
Your review questions and global ranking system were so helpful.
Lina
My Own Flashcard
No flashcard found. Add a private flashcard for the subject.
Add