# Chapter 1 Prerequisites

Before we talk about regression theory, we need to review some basic statistical inference methods and matrix algebra.

This book referred from many books including rowlings’ “Applied Regression Analysis: A research Tool”. $$\beta=(\mathbf{X'X})^{-1}\mathbf{X'y}$$.

A matrix is a square shape array of numbers (sometimes can be string). In this book, boldface letters mean matrices. For example, $\mathbf{A}= \begin{pmatrix} 65 & 154 \\ 73 & 182 \\ 68 &167 \end{pmatrix}.$

This is a sample book written in Markdown. You can use anything that Pandoc’s Markdown supports, e.g., a math equation $$a^2 + b^2 = c^2$$.

The bookdown package can be installed from CRAN or Github:

install.packages("bookdown")
# or the development version
# devtools::install_github("rstudio/bookdown")

Remember each Rmd file contains one and only one chapter, and a chapter is defined by the first-level heading #.

To compile this example to PDF, you need XeLaTeX. You are recommended to install TinyTeX (which includes XeLaTeX): https://yihui.name/tinytex/.