Six Sigma Green Belt Exam Prep

Answer: B - A significant limitation of regression analysis is an incomplete understanding of the relationship between the slope and the random error term.
Key Takeaway: Regression analysis is the most common method for making accurate predictions about future outcomes. By using data collected about two variables, regression analysis allows a business manager to make a prediction about one variable from another variable. In a regression, there is a risk of an incomplete understanding of the relationship between the slope (rate of change of one variable against the other variable) and the random error term (which takes into account the deviation of individual data points from the mean of the data set).