The correct answer is “B”
Donatello Mymuther should tell, not his mother, but his technicians, that he is unable to respond correctly to the question, and that the group should look up scatter diagrams in Practical Tools for Continuous Improvement and report back on what they find.
In fact, as Practical Tools will explain, the standard error of the estimate is a measure of variability of the observations around the regression line.
If it is large (as in Figure 1), then the observations are far from the regression line:
If the observations are close to the regression line, then it will be small:
The standard estimate of the error is calculated with the following formula:
Conceptually, this is similar to the formula for standard deviation:
The difference is that the standard error of the estimate measures the variability around a line, and the standard deviation measures the variability around a point ().