When managers use Ordinary Least Squares to estimate a regression equation, the estimated regression equation is as close to the actual data values as possible.

Question

Quizplus · Accepted Answer

Ordinary Least Squares (OLS) estimation minimizes the sum of the squared differences between the observed values and the values predicted by the regression model, making the estimated regression equation as close to the actual data values as possible in terms of minimizing these squared errors.

When Managers Use Ordinary Least Squares to Estimate a Regression