he following table gives the experience (in years) and the number of stocks sold during the previous three months by seven brokers in the Egyptian stock market. Experience ( years) 4 12 9 6 10 16 7 Number of stocks 19 42 28 31 39 35 21 Determine both dependent and independent variables, and explain the expected relationship between Calculate the correlation coefficient comment on the results. Estimates the simple regression model and comment on the estimated coefficient
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.
The following table gives the experience (in years) and the number of stocks sold during the previous three months by seven brokers in the Egyptian stock market.
|
Experience ( years) |
4 |
12 |
9 |
6 |
10 |
16 |
7 |
|
Number of stocks |
19 |
42 |
28 |
31 |
39 |
35 |
21 |
- Determine both dependent and independent variables, and explain the expected relationship between
- Calculate the
correlation coefficient comment on the results. - Estimates the simple regression model and comment on the estimated coefficients.
- Calculate the coefficient of determination and comment on the results.
- Predict the number of stocks sold during the past three months by broker with eleven years of
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