An outlier is an observation that lies an abnormal distance from other values in a random sample from a population.

An outlier is an observation that lies an abnormal distance from other values in a random sample from a population. Visual display is important, as researchers may use scattergrams or other plots of the data to determine unusual observations in data. Outliers may change the regression line and decrease your r-square. For a simple example, the first column below is the independent variable and the second column is the dependent variable. Using Excel, generate or create a scattergram and the regression output, notice the location of the last data point showing the outlier. Then, drop the outlier and perform the regression analysis again. The difference in the accuracy of the regression analysis should be noted. Discuss the problems of outliers and discuss possible solutions.Independent Variable