We’re going to show you **2 **methods of how to **find Residual Standard Error **in **Excel**. To demonstrate our methods, we’ve picked a dataset with **3 columns:** “**Company**”, “**Advertising**”, and “**Revenue**”. Moreover, we’re **finding **the relationship between **Advertising **and **Revenue **generation of **Company XYZ**. Consequently, this **error **will tell us how much our predicted values differ from the actual values.

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## 2 Ways to Find Residual Standard Error in Excel

### 1. Regression Analysis to Find Residual Standard Error

For the first method, we will **find **the **Residual Standard Error** by applying the **Regression Analysis** to our dataset. Firstly, we’ll need to enable the **Data Analysis** feature in **Excel**.

**Steps:**

- Firstly, press
**ALT**,**F**then**O**to bring up the**Excel Options**window. - Secondly, from
**Add-ins**>>> select “**Go…**”.

Another **dialog box** will appear.

- Thirdly, select “
**Analysis Toolpak**” and press**OK**.

Thus, we will enable the **Data Analysis** feature. We can see the newly created feature inside the **Data **tab.

- Then, click on
**Data Analysis**.

The **Data Analysis dialog box **will appear.

- After that, select
**Regression**and press**OK**.

Now, we’ll select the following options inside the **Regression dialog box** –

**Input Y Range: D4:D10**. Here**Y Range**means(*Dependent variable***Revenue**).**Input X Range: C4:C10**. Here,**X Range**means(*Independent variable***Advertising**).- Select
**Labels**. **Output Range: B12**. We’ll put the**Regression**value here.- Finally, press
**OK**.

From the **Summary Output**, we’ll get our value. The **Standard Error 74.30977729**.

We can get it if we **Square Root** the value of the **Mean Square **of** Residual** (**5521.94**).

**Read More:** **How to Calculate Standard Error of Regression in Excel (with Easy Steps)**

### 2. Find Residual Standard Error Using Generic Formula

We’ll find Residual** Standard Error** using this formula **Sqrt((y-ŷ)^2/df)**.

Where

**df**=**degrees of freedom**.**Residual**= Observed value (**y**) – Predicted (advertising) value (**ŷ**).

In this last method, we’re going to use a formula to find **Residual Standard Error** in **Excel**. Here, we’ll use **the LINEST function** to find the **Linear Regression **equation then using the above formula we’ll find our values. We’ve also used **SUM**, **SQRT** functions in this section to get our result. Moreover, we’ve changed our dataset.

**Steps:**

Now, we’re going to find the **Intercept **and **Slope **values of our **Regression** model.

- Firstly, we’ll select the
**cell**range**G9:H9**and type the following formula.

`=LINEST(C6:C11,B6:B11)`

This function returns statistical values from provided **X** and **Y** values. Our** y_values** are in

**cell**range

**C6:C11**and the

**x_values**are in

**cell**range

**B6:B11**.

- Secondly, press
**CTRL + ENTER**.

This will convert our formula to an array formula, due to this we’ll see a *curly bracket*.

We’ll find the **Intercept **as **14.46445118** and slope **-10.58989665**. Our **Regression **equation will be **ŷ= -10.59 + 14.46x**.

Now, we’ll find the **Predicted Revenues**.

- Firstly, select the
**cell**range**D6:D11**. - Secondly, type the following formula.

`=$H$9+$G$9*B6`

We’re using this formula that we got the **Regression **equation.

- Then, press
**CTRL + ENTER**.

We’ll get the **Predicted values** from this.

Then, we’ll find the squared difference between **predicted **and **actual **values.

- Select the
**cell**range**E6:E11**and type this formula.

`=(C6-D6)^2`

- After that, press
**CTRL + ENTER**.

- Type this formula in
**cell E13**.

`=SUM(E6:E11)`

We’re adding all the values from **cell E6** to **E11**.

Here, **df** means **degrees of freedom**. We have **6** values in our dataset and there are** 2 parameters **in our dataset. Hence our **df** **=** **6-2 =** **4**.

Then, we’ll find the value of **Residual Standard Error**.

- Type this formula in
**cell****E15**.

`=SQRT(E13/E14)`

We’re finding the **square root** value of the **cell** of the value **E13** divided by the value of **E14**.

- Finally, press
**ENTER**.

Thus, we’ll get our value.

**Read More:** **How to Calculate Standard Error of Regression Slope in Excel**

## Practice Section

We’ve added a practice dataset in the Excel file.

## Conclusion

We’ve shown you **2** methods of how to **find Residual Standard Error** in **Excel**. Additionally, if you have any questions, feel free to comment below. Thanks for reading, keep excelling!