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CORRELATION
Definition
• Tendency of two or more groups or series of
items to vary together directly or inversely.
• Analysis of association b/n two variables.
• Eg; price & supply
Different kinds of correlation
• Positive & negative
• Linear & non – linear
• Simple , multiple & partial
Positive & negative
• +ve - value of two variables moves in same
direction.
• Eg; price& supply
• -ve- value of two variables moves in opposite
direction.
• Eg; price& demand
Positive correlation
Negative correlation
Linear and non- linear
• Linear –const ratio of change exist b/n two
variables.
• Eg ;
X : 20 25 30 35 40
y : 30 37.5 45 52.5 60
ratio 2:3.
Non-linear-no const ratio
Simple, partial & multiple
• Simple – only two variables
• Multiple-degree of association b/n one
variable to others.
• Eg ;yield with both rainfall & temperature.
• Partial –relating 2 variables assuming one as
const.
• Eg –yield & rain fall (temperature const).

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Presentation1

  • 2. Definition • Tendency of two or more groups or series of items to vary together directly or inversely. • Analysis of association b/n two variables. • Eg; price & supply
  • 3. Different kinds of correlation • Positive & negative • Linear & non – linear • Simple , multiple & partial
  • 4. Positive & negative • +ve - value of two variables moves in same direction. • Eg; price& supply • -ve- value of two variables moves in opposite direction. • Eg; price& demand
  • 7. Linear and non- linear • Linear –const ratio of change exist b/n two variables. • Eg ; X : 20 25 30 35 40 y : 30 37.5 45 52.5 60 ratio 2:3. Non-linear-no const ratio
  • 8. Simple, partial & multiple • Simple – only two variables • Multiple-degree of association b/n one variable to others. • Eg ;yield with both rainfall & temperature. • Partial –relating 2 variables assuming one as const. • Eg –yield & rain fall (temperature const).