In regression analysis, what does the slope of the trend line indicate?

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Prepare for the UCF QMB3200 Final Exam with targeted flashcards and multiple-choice questions. Each question is designed to enhance your understanding, with hints and detailed explanations provided. Get exam-ready now!

The slope of the trend line in regression analysis represents the relationship between the dependent variable and the independent variable. Specifically, it indicates how much the dependent variable is expected to change for a one-unit increase in the independent variable. A positive slope suggests that as the independent variable increases, the dependent variable tends to increase as well, indicating a direct relationship. Conversely, a negative slope would imply that an increase in the independent variable corresponds to a decrease in the dependent variable, indicating an inverse relationship.

This interpretation of the slope is fundamental for understanding how changes in one variable can impact another, which is the core purpose of regression analysis. The correct interpretation of the slope helps in making predictions and understanding the strength and nature of relationships in the data being analyzed.