The sample regression line estimated by OLS
A)has an intercept that is equal to zero.
B)is the same as the population regression line.
C)cannot have negative and positive slopes.
D)is the line that minimizes the sum of squared prediction mistakes.

Question

Quizplus · Accepted Answer

The OLS regression line is the line that minimizes the sum of squared prediction mistakes. This means that it is the line that is closest to all of the data points in terms of their vertical distance from the line. The intercept of the line may or may not be zero, depending on the data. The population regression line is not estimated by OLS, but rather it represents the true underlying relationship between the independent and dependent variables in the population. The slope of the line can be negative or positive depending on the direction of the relationship between the variables.

The Sample Regression Line Estimated by OLS