Teachers' salaries in OECD countries and GDP
Use this diagram to explain the ideas of fitted values and residuals.
The line is one that might be used to predict the annual teacher salary in a country from its GDP. (It is not the least squares line.) Click any cross to identify the country and display the actual teacher salary and what is predicted by the line. Its residual is shown in red.
You could mention that positive residuals are above the line and negative ones are below the line.
The data set contains the annual salary (US$ thousand) for teachers in lower secondary education after 15 years experience, for OECD countries, plotted against GDP per capita (also US$ thousand). As might be expected, countries with high GDP also tend to pay their teachers more.