This power point presentation is regarding Correlation , Kinds of correlation, Positive and Negative Correlation, Linear and Non - linear correlation.

1. Thomas Robert Malthus

2. WELCOME
BY: - RAMESH KUMAR,
PGT – ECONOMICS,
K V NO.1, BATHINDA CANTT.

3. CONCEPTUAL QUESTIONS: -
1. What is relationship between height and
weight?
2. What is relation between age of husband and
wife?
3. What is the relationship between price and
demand?

4. What do you Mean by correlation?

5. Meaning of Correlation
Correlation is a statistical tools which shows the
relationship between the two variables in
which change in the value of one variable due
to change in the value of other variable

6. KINDS OF CORRELATION
• Positive and Negative correlation
• Linear and Non Linear Correlation.
• Simple, Multiple and Partial Correlation.

7. Positive and Negative correlation
When both the variable change in
the same direction, i.e. both the
variables increase or both the
variables decrease, it is called
Positive Correlation

8. POSITIVE CORRELATION
Both Variables increasing
• X Y
• 10 100
• 20 150
• 30 160
• 40 190
• 50 200
• 60 255
Both Variables Decreasing
• X Y
• 70 147
• 60 140
• 40 135
• 30 130
• 15 120
• 10 90

9. What is negative Correlation?

10. Negative Correlation
When both variable change in the
opposite direction, it is called
Negative correlation.

11. NEGATIVE CORRELATION
One Variable increasing and
other Decreasing
• X Y
• 25 125
• 30 110
• 35 90
• 40 80
• 45 75
• 50 60
One variable Decreasing , the
other increasing
• X Y
• 75 110
• 60 180
• 40 190
• 30 300
• 20 240
• 10 250

12. ACTIVITY FOR THE STUDENTS
Please write down: -
(A) 4 example of Positive Correlation
and
(B) 4 examples of negative Correlations

13. Examples of Positive and Negative
Correlation
POSITIVE CORRELATION:-
1. Age of Husband & Age
of wife
2. Price of commodity and
amount of supply.
3. Increase in heat affects
temperature.
4. Increase in height and
weight.
NEGATIVE CORRELATION: -
1. Demand of commodity
may go down a a
result of rise in prices.
2. Sale of woollen
garments and day
temperature.
3. Yield of crops and
price.

14. Linear correlation and Non Linear
Correlation
* If the Ratio of change between two variables is
uniform than Linear correlation exists.
* linear and Non – Linear correlation is based
upon the consistency of the ratio of changes
between the variables.
* Their relationship described by straight line
If the variables under study are graphed, the
point will form a straight line,

15. LINEAR CORRELATION
• In case of non linear relationship , the
amount of change in one variable does not
bear a constant ratio to the amount of change
in the other variable, Such as relationship will
form a curve on graph.

16. Non Linear Correlation
If the ratio of change between the variable is
not the same than Non linear correlation
exists. Non –Linear Relationship will form
curve on graph.

17. Simple Correlation
Simple Correlation : - It is based upon the
number of variable under study.
• When only two variables are studied, the
correlation between them is called simple
Correlation

18. Multiple and Partial Correlation
When three or more variables are
studied the relationship can be
either multiple or partial.

19. DEGREE OF CORRELATION
There is three types of correlations: -
1. Perfect Correlation.
2. Zero Correlation.
3. Limited degree Correlation.

20. PERFECT DEGREE OF CORRELATION: -
• Perfect degree correlation is that where
changes in two variables are exactly
proportional. If equal proportion changes are
in the same direction, there is perfect positive
correlation between the two values described
as + 1,
• If equal proportional changes are in the
reverse direction, there is perfect negative
correlation, described as -1.

21. ZERO DEGREE CORRELATION
• The value of Coefficient of correlation may be
zero. It means that there is zero correlation.
• It does not mean the absence of any type of
relation between the two variables. Two value
are uncorrelated . However, other type of
relation may be there. There is no Linear
relationship between them.

22. LIMITED DEGREE CORRELATION
• In social science , the variables may be correlated, but
an increase in one variable need not always be
accompanied by a corresponding or equal increase (or
decrease) in the variableS.
• Correlation said to be limited positive when there are
unequal's changes in the two variables in the same
direction and correlation degree of combination can be
high ( between + 0.75 to 0.99 and - 0.75 to -0.99)
• Moderate ( + 0.25 to + 0.74 and -0.25 to -0.74)
• Low degree correlation 0 to + 0.24 and 0 to -0.24)
-

23. DEGREE OF CORRELATION
PERFECT
CORRELATION
NO CORRELATION
-1
POSITIVE OPERFECT
+1

24. DEGREE OF CORRELATION
LIMITED DEGREE
CORRELATION
POSITIVE NEGATIVE

25. LIMITED DEGREES OF CORRELATION
HIGH
+ 0.75 TO 0.99
-.075 TO -0.99
MODERATE
+0.25 TO + 0.74
-0.25 TO – 0.74
LOW
+0 TO +0.24
0 TO -0.24

26. RECAPTULATION : -
• 1. What is correlation?
2. What is Positive Correlation?
3. What do you mean negative correlation?
4. What is Simple correlation?
5. What is meant by Multiple Correlation?

27. HOME ASSIGNMENT
• What is meant by Correlation?
• What are different types of correlation? Show
with the help of example of daily life.
• PROJECT: - Calculate Correlation between
History and Economics, Economics and Maths.
of the students of your group on the basis of
First Term Unit Test Marks.
• Correlation with other subjects.

28. Thanks
RAMESH KUMAR,
PGT ECONOMICS,
K V NO.1, BATHINAD CANTT.