# Terminology related to regression Analysis and Why we use regression analysis?

## Terminologies Related to the Regression Analysis:

• Dependent Variable: The main factor in Regression analysis which we want to predict or understand is called the dependent variable. It is also called target variable .
• Independent Variable: The factors which affect the dependent variables or which are used to predict the values of the dependent variables are called independent variable, also called as a predictor .
• Outliers: Outlier is an observation which contains either very low value or very high value in comparison to other observed values. An outlier may hamper the result, so it should be avoided.
• Multicollinearity: If the independent variables are highly correlated with each other than other variables, then such condition is called Multicollinearity. It should not be present in the dataset, because it creates problem while ranking the most affecting variable.
• Underfitting and Overfitting: If our algorithm works well with the training dataset but not well with test dataset, then such problem is called Overfitting . And if our algorithm does not perform well even with training dataset, then such problem is called underfitting .

## Why do we use Regression Analysis?

As mentioned above, Regression analysis helps in the prediction of a continuous variable. There are various scenarios in the real world where we need some future predictions such as weather condition, sales prediction, marketing trends, etc., for such case we need some technology which can make predictions more accurately. So for such case we need Regression analysis which is a statistical method and used in machine learning and data science. Below are some other reasons for using Regression analysis:

• Regression estimates the relationship between the target and the independent variable.
• It is used to find the trends in data.
• It helps to predict real/continuous values.
• By performing the regression, we can confidently determine the most important factor, the least important factor, and how each factor is affecting the other factors .