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Data Forecasting and Segmentation Using Microsoft Excel

You're reading from   Data Forecasting and Segmentation Using Microsoft Excel Perform data grouping, linear predictions, and time series machine learning statistics without using code

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Product type Paperback
Published in May 2022
Publisher Packt
ISBN-13 9781803247731
Length 324 pages
Edition 1st Edition
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Author (1):
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Fernando Roque Fernando Roque
Author Profile Icon Fernando Roque
Fernando Roque
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Table of Contents (19) Chapters Close

Preface 1. Part 1 – An Introduction to Machine Learning Functions
2. Chapter 1: Understanding Data Segmentation FREE CHAPTER 3. Chapter 2: Applying Linear Regression 4. Chapter 3: What is Time Series? 5. Part 2 – Grouping Data to Find Segments and Outliers
6. Chapter 4: Introduction to Data Grouping 7. Chapter 5: Finding the Optimal Number of Single Variable Groups 8. Chapter 6: Finding the Optimal Number of Multi-Variable Groups 9. Chapter 7: Analyzing Outliers for Data Anomalies 10. Part 3 – Simple and Multiple Linear Regression Analysis
11. Chapter 8: Finding the Relationship between Variables 12. Chapter 9: Building, Training, and Validating a Linear Model 13. Chapter 10: Building, Training, and Validating a Multiple Regression Model 14. Part 4 – Predicting Values with Time Series
15. Chapter 11: Testing Data for Time Series Compliance 16. Chapter 12: Working with Time Series Using the Centered Moving Average and a Trending Component 17. Chapter 13: Training, Validating, and Running the Model 18. Other Books You May Enjoy

Chapter 9: Building, Training, and Validating a Linear Model

In the last chapter, we learned about statistical data tests to validate whether it is useful to build a predictive model. It depends on the strong relationship between the predictor variable, X, and the result variable, Y.

In this chapter, we will develop a prediction model to see whether the amount of fuel in miles per gallon is affected by motor horsepower. We will understand how to measure the difference between the expected values from the data source and the response given by the model.

The strong or weak relationship between the expected values and the linear regression is based on the difference between the training data and the regression model. We can use several tests to check whether the predictor variable and the result variable have a link. These statistical tests can be as follows:

  • The coefficients of determination and correlation
  • t-statistics
  • The p-value
  • f-statistics

t-statistics...

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