Below is a correlation matrix for variables related to the annual salary for 30 employees at a company. The variables are gender (1 for female; 0 for male), age, number of years of relevant work experience prior to employment at the company, number of years of employment at the company, the number of years of post-secondary (college) education, and annual salary. Why are all the diagonal elements all “1”
Correlation
Correlation defines a relationship between two independent variables. It tells the degree to which variables move in relation to each other. When two sets of data are related to each other, there is a correlation between them.
Linear Correlation
A correlation is used to determine the relationships between numerical and categorical variables. In other words, it is an indicator of how things are connected to one another. The correlation analysis is the study of how variables are related.
Regression Analysis
Regression analysis is a statistical method in which it estimates the relationship between a dependent variable and one or more independent variable. In simple terms dependent variable is called as outcome variable and independent variable is called as predictors. Regression analysis is one of the methods to find the trends in data. The independent variable used in Regression analysis is named Predictor variable. It offers data of an associated dependent variable regarding a particular outcome.
Below is a correlation matrix for variables related to the annual salary for 30 employees at a company. The variables are gender (1 for female; 0 for male), age, number of years of relevant work experience prior to employment at the company, number of years of employment at the company, the number of years of post-secondary (college) education, and annual salary.
Why are all the diagonal elements all “1”
- Interpret the
negative correlation between years’ experience at the company and gender
- Based on these
correlations , what seems to be the strongest influences on this company’s salary decisions?
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