In Ordinary Least Squares Regression, the gap between the value of the dependent variable and the predicted value is called
A)the error term.
B)the minimizing coefficient.
C)the residual.
D)the explanatory variable.

Question

Quizplus · Accepted Answer

The gap between the value of the dependent variable and the predicted value is called the residual in OLS regression, which constitutes the error term in OLS. Option A is partially correct, but it is not satisfactory as it fails to indicate that the error term is specifically the residual. Option B is completely untrue as the minimizing coefficient is not related to the residual. Option D is incorrect, as the explanatory variable is the independent variable that is used to predict the dependent variable, not the gap between the actual and predicted value.

In Ordinary Least Squares Regression, the Gap Between the Value