This document contains 35 multiple choice questions about correlation analysis. Correlation analysis measures the relationship between two variables and can be used to predict one variable based on the other. The correlation coefficient ranges from -1 to 1, with -1 indicating a perfect negative correlation and 1 indicating a perfect positive correlation. Questions cover topics like calculating the correlation coefficient from data, interpreting the direction and strength of correlation based on scatter plots, and the effects of transformations on the correlation coefficient.

1. Page 1 of 4
Faculty: AMIR KHATRI
1. Correlation analysis is used to:.
a. predict one variable for a given value of other variable.
b. establish relationship between two variables.
c. measures the extent of relation between two variables.
d. both (a) & (b)
2. Supurious correlation is
a. no correlation between two variables
b. correlation between two variables have casual relation
c. positive correlation with low degree
d. negative correlation with low degree
3. The correlation between sales of woolen clothes & temperature is:
a. Spurious b. Negative c. Positive d. Absent
4. what is range of correlation coefficient?
a. 0 to 1 b. -1 to 0 c. -1 to 1 d. 0 to -1
5. If r(x,y) = 0.3 then r(2x+3, 3-2y) = ……………..
a. -0.3 b. 0.3 c. 0 d. 1
6. If r(x,y) = 0.4 then r(ax+b, cy+d) = ……………. (where a>0, b<0, c>0, d<0)
a. 0.4 b. -0.4 c. 0 d. 1
7. If linear relation between variables x & y is given as y = a + bx, b > 0 then r = …….
a. 0 b. 1 c. 0.5 d. -1
8. If the plotted points in a scatter diagram lie from lower left to upper right, than the
correlation is
a. Negative b. Positive
c. perfect negative d. perfect positive
9. If the plotted points in a scatter diagram lie from lower right to upper left in the same
proportion, than the correlation is
a. Negative b. Positive
c. perfect negative d. perfect positive
10. Sign of product moment correlation coefficient depends on
a. variance of X b. covariance
c. variance of Y d. product of two standard deviation

2. Page 2 of 4
Faculty: AMIR KHATRI
11. The coefficient of correlation between two variables
a. is a unit free measure
b. is expressed as product of units of two variables
c. is expressed in units of first variable
d. is expressed in units of second variable
12. Correlation coefficient is independent of change of origin
a. is always false b. is always true
c. can be false d. can be true
13. For 10 pairs of observations, ∑x =2, ∑y = 1, ∑x2
= 60, ∑y2
= 67, ∑xy = -57. Find
correlation coefficient.
a. 0.9 b. 0.09 c. – 0.09 d. – 0.9
14. For 10 pairs of observations, ∑x =90, ∑y = 950, ∑(x-100)2
= 54, ∑(y-95)2
= 96, ∑(x-
100)(y-15) = 61. Find correlation coefficient.
a. 0.85 b. 0.94 c. 0.012 d. 0.12
15. A person while calculating the correlation coefficient between the variables x & y for 25
observations, obtained the following results: ∑x =125, ∑y = 100, ∑x2
= 650, ∑y2
= 460,
∑xy = 508. It was, however found that the pairs of observations (8,12) & (6,8) were
wrongly taken as (6,14) & (8,6). What will be correct correlation coefficient?
a. 0.21 b. – 0.21 c. 0.67 d. – 0.67
16. The correlation coefficient is 1, then the slope of the straight line in a scatter diagram is:
a. positive b. negative
c. zero d. none of these
17. For 10 pairs of observations, the ranks of two variables are exactly in reverse order then
∑d2
= ……………
a. 1 b. – 1 c. 330 d. 33
18. If rank correlation coefficient is
2
3
& the sum of square of differences of ranks is 28 then
find number of pairs of observations.
a. 7 b. 9 c. 10 d. 8
19. Which of the following is the value of correlation coefficient?
a. – 1.10 b. 1.10 c. – 1.01 d. 0.10
20. If the dependent variable decrease as the independent variable increases in an
estimating equation then, the correlation coefficient will be in the range of
a. – 2 to 0 b. – 1 to 0 c. 0 to 0.5 d. 0 to 1

3. Page 3 of 4
Faculty: AMIR KHATRI
21. If the points in scatter diagram show a very little spread & a tendency to rise from left to
right along the horizontal axis, then we conclude that
a. there is perfect positive correlation
b. there is perfect negative correlation
c. there is low degree of negative correlation
d. there is high degree of positive correlation
22. The covariance between the variables x & y is 10, & the variance of x & y are 16 & 64
respective. What is the correlation coefficient between x & y?
a. 0.3125 b. 0.625 c. 0.15625 d. 0.40
23. The correlation coefficient between two variables is 0.4. if each observations is doubled,
the correlation coefficient will be
a. 0.8 b. 0.4 c. 0.2 d. 0
24. If the variances of variables x & y are 25 & 16 respectively. What would be the value of
covariance between two variables?
a. 25 b. 250
c. more than 20 d. less than or equal to 20
25. Age of applicant for life insurance & premium of insurance is ………. Correlation.
a. zero b. negative c. positive d. spurious
26. If 2u + 3x = 10 & 3v – 2y =5 & the correlation coefficient between u & v is -0.4 then what
would be the correlation coefficient between x & y?
a. 0.4 b. – 0.4 c. 1 d. – 1
27. Obtain correlation coefficient using the following data:
n = 10, ,22x ,22y ∑ xy = 4220, ,12x
,10 y
a. – 0.33 b. 0.33
c. 0.028 d. none of these
28. For 10 pairs of observations following data is recorded
X Y
Average 161 162
Sum of squares of deviations from mean 254 150
Sum of products of deviatios from mean 164
Calculate correlation coefficient
a. 0.004 b. – 0.68 c. – 0.84 d. 0.84
29. When ∑x = 20, ∑y = 40, ∑xy = 150 for 7 pairs of observation then covariance between x
& y is:
a. 10 b. 0.73 c. 5.11 d. 133.69

4. Page 4 of 4
Faculty: AMIR KHATRI
30. For 8 pairs of observations there is perfect agreement in the order of the rank, then r is:
a. 1 b. – 1 c. 0 d. 0.5
31. If the two variables are independent then product moment correlation coefficient is:
a. 1 b. 0 c. – 1 d. none of these
32. For 8 pairs of observations ∑x = 256, ∑y = 973, ∑(x – 32)2
= 1022, ∑(y – 121)2
= 4941,
∑(x – 32)(y – 121) = 2212. Calculate correlation coefficient.
a. 0.98 b. 0.00044
c. 0.31 d. none of these
33. For 7 pairs of observations ∑(x – 67) = 0, ∑(y – 68) = 0, ∑(x – 67)2
= 28, ∑(y – 68)2
= 34,
∑(x – 67)(y – 68) = 25. Calculate correlation coefficient.
a. – 0.81 b. 0.026 c. – 0.46 d. 0.81
34. For 5 pairs of observations ∑xv = -5, ∑x2
= 242, ∑v2
= 63, ∑x = 32, ∑v = -1 & v= y – 25.
Calculate correlation coefficient.
a. 0.07 b. 0.70
c. – 0.07 d. none of these
35. Three judges A, B & C were in a panel of beauty contest in which there were 10
competitors. If sum of squares of difference in ranks given A & B, A & C, B & C are 110,
120, 115 respectively. Which two judges have nearest approach towards beauty?
a. A & B b. A & C
c. B & C d. all three