The following data represents the investment of a company and profits obtained by that company. Investment 20 30 40 50 60 70 80 90 Profits 4 6 8 10 12 14 16 18 i. Do you think, there is any correlation between profits and investments of the company? ii. Fin the coefficient of correlation between investments and profits. iii. Also, interpret the computed value.
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.
Q.No.4.The following data represents the investment of a company and profits obtained
by that company.
Investment 20 30 40 50 60 70 80 90
Profits 4 6 8 10 12 14 16 18
i. Do you think, there is any
company?
ii. Fin the coefficient of correlation between investments and profits.
iii. Also, interpret the computed value.
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