Discussion Assignment Example | Topics and Well Written Essays - 250 words - 103

Discussion - Assignment Example First, regression analysis uses data from past events and therefore may not be accurate if unaccounted event occurs. For instance, a natural catastrophe such as earthquake may stall all building constructions in a given area forcing customers to stop buying. If linear regression uses previous data where catastrophe was absent, then its outcome will be inaccurate. Such errors can be avoided by adding as many variables as feasibly possible to the regression model used (Montgomery, 2011). Duration in which regression data points were taken determines the accuracy of the regression results. More data points are more likely to yield more accurate results. For instance, monthly sales spanning about five years can provide accurate regression results of sales as opposed to quarterly sales of past one year. Lastly, regression modelling is only as accurate as the variables used (Seber et al. 2003). Too few variables may not give accurate predictions because they may not give accurate history. Too many variables may not give accurate prediction either because some of the events may not happen in future. To improve the results, more data points should be used in conjunction with a fair number of multiple