The following data are claims (in $millions) for Blue cross Blue shield benefits benefits for nine states, along with the surplus (in $millions) that the company had in assets in those states. State Claims Surplus Alabama 1425 277 Colorado 273 100 Florida 915 120 Illinois 1687 259 Maine 234 40 Montana 142 25 North Dakota 259 57 Oklahoma 258 31 Texas 894 141 Use the data to compute a correlation coefficient, to determine the correlation between claims and surplus. Interpret the results accordingly explain all variables under study along with their significance. Further explain entire concept of Correlation using 5 real life situations which explains the concept of correlation in detail. Make use of appropriate reference and enrich your literature review appropriately.
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 data are claims (in $millions) for Blue cross Blue shield benefits benefits for nine states, along with the surplus (in $millions) that the company had in assets in those states.
State Claims Surplus
Alabama 1425 277
Colorado 273 100
Florida 915 120
Illinois 1687 259
Maine 234 40
Montana 142 25
North Dakota 259 57
Oklahoma 258 31
Texas 894 141
Use the data to compute a
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