Question

1) Describe the steps involved in running an OLS regression from the initial point of

deciding the theoretical model to stating the conclusions on the results.

Answer 1

Linear regression analysis entails more than simply fitting a linear line through a cloud of data points. There are three steps to it:

(1) Looking for correlation and directionality in the data.

(2) Fitting the line to the model, or estimating the model.

(3) Assessing the model's usefulness and validity.