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Predicting a Value

If you want to forecast or predict the value of a variable (dependent variable) and you are given the value of a second variable (independent variable), it may first be necessary to know how the variables are related. Regression analysis allows you to estimate the structure of this relationship with a certain degree of confidence.

The use of simple linear regression analysis requires the relationship between the two variables to be linear and the direction of causation to flow from the independent to the dependent variable. In the absence of these conditions, the method is unreliable.