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SAI INTERNATIONAL SCHOOL

Statistics for Economics

Class-XI

CHAPTER - 11

Correlation analysis

(Module-63 )

Meaning of correlation analysis.

Types of correlation.

Scatter Diagram

Karl Pearson’s coefficient of correlation.

With the help of measures of central tendency the statisticians try to represent
a large no of data to a single figure, whereas with the help of dispersion

analysis one tries to find out the variability of data from central value to make
a study about the consistence of the set of data as compare to other.

Meaning of correlation analysis: -

Correlation analysis is a statistical method used to evaluate the strength
of relationship between two quantitative variables.

A high correlation means that two or more variables have a strong

relationship with each other, while a weak correlation means that the
variables are hardly related.

Types of correlation: -

1. Simple, Multiple, and partial correlation: -

Whether the correlation is simple, partial or multiple depends on
the number of variables studied.

The correlation is said to be simple when the degree relationship

between only two variables are studied.