About This Chapter
Measures of Association & Correlation in Business - Chapter Summary
Our chapter on the measures of association and correlation in business is accessible 24 hours a day to help you study whenever it's convenient. You'll review bite-sized lessons on topics like correlation and causation, the correlation coefficient and the relationship between variables. Along with each lesson, we've included a short self-assessment quiz to ensure you understand what you're learning. Help from one of our expert instructors is just a few clicks away in the Dashboard. Once you finish this chapter, you should be able to:
- Differentiate between correlation and causation
- Discuss the relationship between variables
- Explain the formula used for the correlation coefficient
- Use the raw score method to compute the correlation coefficient
- Give an example of coefficient of determination
- Detail the significance of the Pearson correlation coefficient
- Describe business and finance uses for measures of correlation
- Calculate the correlation coefficient in Excel
1. Correlation vs. Causation: Differences & Definition
When conducting experiments and analyzing data, many people often confuse the concepts of correlation and causation. In this lesson, you will learn the differences between the two and how to identify one over the other.
2. The Relationship Between Variables: Correlation Coefficient & Scatterplots
The focus of this lesson is on how both correlation coefficients and scatterplots convey the same message. Specifically, this lesson will explore how these two can reveal the same information but in different ways.
3. The Correlation Coefficient: Definition, Formula & Example
The correlation coefficient is an equation that is used to determine the strength of the relationship between two variables. This lesson helps you understand it by breaking the equation down.
4. Using the Raw Score Method to Compute the Correlation Coefficient
This lesson looks at the mathematical steps involved in computing a correlation coefficient by using raw scores. We will walk through the process with easy to follow numbers.
5. Coefficient of Determination: Definition, Formula & Example
The coefficient of determination is an important quantity obtained from regression analysis. In this lesson, we will show how this quantity is derived from linear regression analysis, and subsequently demonstrate how to compute it in an example.
6. Pearson Correlation Coefficient: Formula, Example & Significance
The Pearson correlation coefficient is just one of many types of coefficients in the field of statistics. The following lesson provides the formula, examples of when the coefficient is used, its significance, and a quiz to assess your knowledge of the topic.
7. Measures of Correlation in Business & Finance: Uses & Examples
Correlation provides a statistical measure of the relationship between pairs of variables. The correlation process can be used to assist in basic business and financial analyses, providing its users with more informed decision making processes.
8. How to Calculate the Correlation Coefficient in Excel
How are the sales of coffee related to football games? In this lesson, we try to answer this question by using Excel to calculate the correlation coefficient between two variables.
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Other chapters within the Business 212: Business Statistics course
- Introduction to Business Statistics
- Introduction to Categorical Data
- Descriptive Statistics: Measurement
- Descriptive Statistics: Representation
- Measures of Dispersion in Business
- Probability for Business Statistics
- Probability Distributions for Business Statistics
- Sampling Methods for Statistics
- Confidence Intervals
- Hypothesis Testing in Business
- Analysis of Variance
- Nonparametric Methods in Statistics
- Regression Analysis
- Understanding Business Forecasting
- Using Control Charts in Business