Ever wondered why Regression and ANOVA are studied separately while mathematical construct of both looks similar?

If the above mentioned question popped up in your mind ever, this blog might help to answer this question. Mathematically, ANOVA might be considered as a special case of linear regression analysis in which all explanatory variables are categorical.

From the application point of view, there is a lot of difference between ANOVA and Regression. ANOVA is oftenly used to compare the dependent variable outcome against various categories of explanatory variables. Example - comparing sales of a product at different price categories. On the other hand, regression is used to predict the dependent variable with the help of explanatory variables. Example - predicting sales with the help of explanatory variables like price of the good, price of substitutory good, taste and preference of the consumer etcetera.

ANOVA: Analysis of Variance
ANOVA is just an extension of the t test for equality of two population means.