Simplest form of regression can be undertaken as relation between two type of characteristics (for same entity like person, household etc) which may be represented as continuous data (variable see Data Type). For example, relation between earning and schooling of a person, relation between score and hr. of labour for individuals etc. General technique to study such relationship, is crating a graph on XY plane. Data shown on Y axis is called Dependent variable (DV or endogenous) and its counter part on X is called Independent variable (IV or exogenous) variable. to visitFigure 1 shows scatter plot monthly income (DV) in Rupees with level of education (IV). Although there are many straight lines (like HH, FF, LL) are possible with free hand to get summary of relationship between characteristics shown at Y and X. Best fit for scatter plot may be obtained by choosing a line in such a way so that it may minimize sum (e1+e2…en) of distances from point to proposed line (like FF).
