Coefficient of Determination

The coefficient of determination statistic, more commonly known as the R-squared value, can be interpreted as the proportion of the variation in the dependent variable that is statistically explained by the associated independent variable from the regression model. Coefficient of determination, or R-squared values, (1 Ã’ r2 Ã’ 0) indicate the amount of variation explained. An R-squared value of 1 indicates that 100% of the variation of the dependent variable may be explained by the linear relationship with the independent variable, while an R-squared of 0% indicates no relationship between the dependent and independent variable.