Prediction using simple linear regression (for the CFA Level 1 exam)

[@vyduong1437]

May I ask why we use the 2-tailed test here please?

[@letmeexplaincfa]

It’s not really a test, just two-sided symmetrical interval around the estimated value. And because it is two-sided (+ or -) we approach treat it like a two-tailed test

[@marting1554]

so the moral of this story is: we use regression results to "predict a dependent variable (Yf)", where "the interval" is "how certain are we about the prediction." Let me know if you disagree?

[@letmeexplaincfa]

Yes, that's fair statement :)