# Dr. Michael R. Hyman, NMSU Correlation (Click icon for audio)

## Presentation on theme: "Dr. Michael R. Hyman, NMSU Correlation (Click icon for audio)"— Presentation transcript:

Dr. Michael R. Hyman, NMSU Correlation (Click icon for audio)

2

3 Correlation Coefficient Statistical measure of the co-variation or association between two variables The correlation coefficient for two variables, X and Y is: Sample question to test for statistical and managerial significance: Are dollar sales associated with advertising dollar expenditures?

4 Correlation Does Not Mean Causation Rooster’s crow and the rising of the sun –Rooster does not cause the sun to rise. Teachers’ salaries and liquor consumption –Co-vary because both are influenced by a third variable (e.g., state of economy) Examples: High correlations without causation

5 Possible Values for r ranges from +1 to -1 r = +1: a perfect positive linear relationship r = -1: a perfect negative linear relationship r = 0: no correlation

6 Correlation Patterns

7 Simple Correlation Coefficient

8 = Variance of X = Variance of Y = Covariance of X and Y

9 Coefficient of Determination

10 Correlation Matrix Standard form for reporting correlation results

11 Correlation Matrix

12 Correlation for Ordinal Data

13

Download ppt "Dr. Michael R. Hyman, NMSU Correlation (Click icon for audio)"

Similar presentations