R-squared is a statistical measure of how close the data are to the fitted regression line.

It is
also known as the coefficient of determination, or the coefficient of multiple determination for
multiple regression. 0% indicates that the model explains none of the variability of the response
data around its mean.
In statistics, the coefficient of determination, denoted R2 or r2 and pronounced R squared,
is a number that indicates how well data fit a statistical model sometimes simply a line or
curve. It is a statistic used in the context of statistical models whose main purpose is either
the prediction of future outcomes or the testing of hypotheses, on the basis of other related
information
R2 does not indicate whether:

the independent variables are a cause of the changes in the dependent variable;

omitted-variable bias exists;

the correct regression was used;

the most appropriate set of independent variables has been chosen;

there is collinearity present in the data on the explanatory variables;

Adjusted r sqaure: R

shows how well terms (data points) fit a curve or line; Adjusted R 2 also
indicates how well terms fit a curve or line, but adjusts for the number of terms in a model. If you add
more and more useless variables to a model, adjusted r-squared will decrease, but if you add
more useful variables, adjusted r-squared will increase.
Adjusted R2 will always be less than or equal to R2. Use of the adjusted R2 is only necessary when you are
dealing with samples. In other words, R2 isnt necessary when you have data from an entire population
2

The use of an adjusted R2 (often written as

and pronounced "R bar squared") is an attempt to
2
take account of the phenomenon of the R automatically and spuriously increasing when extra
explanatory variables are added to the model

DIFFERENCE
One major difference between R-squared and the adjusted R-squared is that R-squared supposes
that every independent variable in the model explains the variation in the dependent variable. It
gives the percentage of explained variation as if all independent variables in the model affect the
dependent variable, whereas the adjusted R-squared gives the percentage of variation explained
by only those independent variables that in reality affect the dependent variable. R-squared

cannot verify whether the coefficient ballpark figure and its predictions are prejudiced. It also
does not show if a regression model is satisfactory; it can show an R-squared figure for a good
model, or a high R-squared figure for a model that doesnt fit.

The adjusted R-squared is a modified version of R-squared for the number of predictors in a
model. The adjusted R-squared can be negative, but isn't always, while an R-squared value is
between zero and 100 and shows the linear relationship in the sample of data even when there is
no basic relationship. The adjusted R-squared is the best estimate of the degree of relationship in
the basic population. To show correlation of models with R-squared, pick the model with the
highest limit, but the best and easiest way to compare models is to select one with the smaller
adjusted R-squared. Adjusted R-squared is not a typical model for comparing nonlinear models,
but multiple linear regressions.

REGRESSION AND CORRELATION

Correlation analysis studies the joint variation of two or more variables for determining the
amount of correlation between two or more variables.
Causal analysis is concerned with the study of how one or more variables affect changes in
another variable. It is thus a study of functional relationships existing between two or more
variables. This analysis can be termed as regression analysis.
The correlations term is used when 1) both variables are random variables, and 2) the end goal
is simply to find a number that expresses the relation between the variables
The regression term is used when 1) one of the variables is a fixed variable, and 2) the end goal
is use the measure of relation to predict values of the random variable based on values of the
fixed variable

Univariate, bivariate and multivariate are the various types of data that are based on the number
of variables. Variables mean the number of objects that are under consideration as a sample in an
experiment. Usually there are three types of data sets. These are;
UNIVARIATE DATA:
Univariate data is used for the simplest form of analysis. It is the type of data in which analysis
are made only based on one variable. For example, there are sixty students in class VII. If the

variable marks obtained in math were the subject, then in that case analysis will be based on the
number of subjects fall into defined categories of marks.
BIVARIATE DATA:
Bivariate data is used for little complex analysis than as compared with univariate data. Bivariate
data is the data in which analysis are based on two variables per observation simultaneously.
MULTIVARIATE DATA:
Multivariate data is the data in which analysis are based on more than two variables per
observation. Usually multivariate data is used for explanatory purposes.
EXAMPLES;
Univariate:
Example: Pie charts of sales via territory, bar chart of support call volume by products, line
charts of profit over several quarters - all of these descriptions involve one variable at a time.
They are all considered part of an univariate analysis.
Bivariate:
Example: A presentation of two variables at a time as in a scatter plot. Any analysis that is
performed on the scatter plot. Attempt to understand the relationship between sales volume and
ad spending. These are all examples of bivariate analysis.
A bivariate analysis may or may not have a target variable. If there is no target variable, then a
complete bivariate analysis will involve studying n* (n-1)*0.5 total scatter plots, where n is the
number of variables.
Multivariate:
When there are more than one target (or response) variables, any analysis involving studying the
effect of predictors on the responses and their interactions is termed multivariate analysis.

The goodness of fit of a statistical model describes how well it fits a set of observations. Measures
of goodness of fit typically summarize the discrepancy between observed values and the values
expected under the model in question. Such measures can be used in statistical hypothesis testing,
e.g. to test fo r normality of residuals, to test whether two samples are drawn from identical
distributions , or whether outcome frequencies follow a specified distribution