When homeowners list their home for sale, they begin by listing it for a price that is greater than what they expect to receive. The longer a home is on the market, without being sold, the more the price drops. A realtor selects 50 homes that are currently listed for sale. A scatterplot reveals that the association between x = the number of days the home is on the market and y = the current asking price ($) is fairly linear and can be modeled by the equation \hat{y} = 245,000-200xy^=245,000−200x. Additionally, 85.4% of the variation in the current asking price can be explained by this linear model. Which of the following is the value of the correlation (r) for the relationship between x and y? (A) -200−200 (B) -0.924−0.924 (C) 0.1460.146 (D) 0.8540.854 (E) 0.9240.924
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.
When homeowners list their home for sale, they begin by listing it for a price that is greater than what they expect to receive. The longer a home is on the market, without being sold, the more the price drops. A realtor selects 50 homes that are currently listed for sale. A
- (A) -200−200
- (B) -0.924−0.924
- (C) 0.1460.146
- (D) 0.8540.854
- (E) 0.9240.924
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