Realized 1031 Glossary of Terms

Line of Best Fit

Written by The Realized Team | Jun 20, 2022 12:00:00 PM

The line of best fit is used to identify the trend on a scatter plot graph. This line is also called a regression line. It can be found by using the least-squares method, which results in a geometric equation for the line. The line of best fit shows a relationship between points in a scatter plot. However, if the various scatter plot data points are too scattered, a trend will not be identifiable, and the line of best fit will be unreliable.

An example of a line of best fit is plotting manager experience (x-axis) to salary (y-axis). As experience increases, so does salary. If 10 different managers at different stages in their careers are plotted, we should see a line that goes from the bottom left to the upper right.