In this tutorial, I am going to show you 3 easy methods of how to find the standard error of estimate in Excel. You can quickly use these methods to find the standard deviation and so error of the estimate from your model data very easily. Throughout this tutorial, you will also learn some important Excel tools and functions that will be very useful in any Excel-related task.
What Is Standard Error of Estimate?
The standard error of estimate is a measure of the variability of a statistical model. It is used to determine how well a model fits a set of data and to quantify the precision of predictions made using the model. The standard error of estimate is calculated as the square root of the sum of squares of the residuals divided by the degrees of freedom. The smaller the standard error of estimate, the more precise the model is in predicting the dependent variable based on the independent variable. It is an important tool in statistical analysis, as it helps researchers understand the accuracy of their models.
Find Standard Error of Estimate in Excel: 3 Easy Methods
We have taken a concise dataset to explain the steps clearly. The dataset has approximately 6 rows and 2 types of columns. Initially, we are keeping all the cells in General format. For all the datasets, we have 2 unique columns which are Company Name and Monthly Sales Variations. Although we may vary the number of columns later on if that is needed.
1. Using STDEV Function
In Excel, we can use the STDEV function to calculate the standard error of estimate for a sample. To find the standard error of estimate in Excel, you will need to first organize your data in a range of cells, and then use the STDEV function to determine the standard error of estimate for your data. Follow the steps below to do this.
Steps:
- First, go to cell C10 and type in the following formula:
=STDEV(C5:E9)/SQRT(COUNT(C5:E9))- After that press Enter and this will calculate the standard error of estimate inside cell C10.
By following these steps, you can effectively use the STDEV function to calculate the standard error of estimate for your data.
Read More: How to Calculate Standard Error in Excel
2. Applying Excel STEYX Function to Find Standard Error of Estimate
We can also use the STEYX function in Excel to calculate the standard error of estimate for a sample. To find the standard error of estimate in Excel using the STEYX function, you will need to have both the independent and dependent variables in your data set. The STEYX function calculates the standard error of estimate as the square root of the sum of squares of the residuals divided by the degrees of freedom. It is a useful tool for understanding the accuracy of your statistical model. Let us see how to use this function.
Steps:
- To begin with, navigate to cell C10 and insert the formula below:
=STEYX(C5:C9,B5:B9)- Finally, press Enter to confirm the above formula and find the standard error of estimate of the earnings per month values.
You may efficiently utilize the STEYX function to determine the standard error of estimate for your data by following these steps.
Read More: How to Calculate Standard Error of Regression in Excel
3. Utilizing LINEST Function
The LINEST function can be very useful to calculate the standard error of estimate for a sample. The LINEST function returns a variety of statistical parameters, including the standard error of estimate. This value represents the amount of error in the prediction of the dependent variable based on the independent variable. It is a useful tool for understanding the accuracy of your statistical model.
Steps:
- Firstly, double-click on cell E5 and type in the following formula:
=LINEST(C5:C9,B5:B9,TRUE,TRUE)- Next press Enter to confirm this formula.
- Consequently, this formula will find the standard error of estimate in cell F7 as in the image below.
These procedures will help you use the LINEST function to accurately determine the standard error of estimation for your data.
Read More: How to Calculate Standard Error of Proportion in Excel
Download Practice Workbook
You can download the practice workbook from here.
Conclusion
I hope that you were able to apply the methods that I showed in this tutorial on how to find the standard error of estimate in Excel. As you can see, there are quite a few ways to achieve this. So wisely choose the method that suits your situation best. If you get stuck in any of the steps, I recommend going through them a few times to clear up any confusion. If you have any queries, please let me know in the comments.
