Consider the following scatterplot that shows one year's total sales (revenue) and profits for eight large retailers in a country. Estimate the correlation coefficient and determine whether there appears to be a correlation between sales and profits. 175 350 Sales (billions of dollars) Profits (billions of dollars)
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.
![Consider the following scatterplot that shows one year's total sales (revenue) and profits for eight large retailers in a country.
Estimate the correlation coefficient and determine whether there appears to be a correlation between sales and profits.
12-
6-
175
350
Sales (billions of dollars)
There is a
V correlation between sales and profits, and the correlation coefficient is approximately
perfect positive
strong positive
strong negative
weak positive
perfect negatíve
weak negative
Click to sel
Profits (billions of dollars)](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fb2f88db6-b759-48e5-b7fb-762b565d2a77%2F684d6190-99d6-4fe8-bb29-70b4f5c1fae7%2Fcp0kos9_processed.jpeg&w=3840&q=75)
![Consider the following scatterplot that shows one year's total sales (revenue) and profits for eight large retailers in a country.
Estimate the correlation coefficient and determine whether there appears to be a correlation between sales and profits.
12-
6-
0.
175
350
Sales (billions of dollars)
There is a
correlation between sales and profits, and the correlation coefficient is approximately
0.93.
-0.24.
1.
-0.93.
0.24.
1.
Click to select your answer(s).
Profits (billions of dollars)](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fb2f88db6-b759-48e5-b7fb-762b565d2a77%2F684d6190-99d6-4fe8-bb29-70b4f5c1fae7%2Fsjwbnlg_processed.jpeg&w=3840&q=75)
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