Download - Correlation analysis ppt
CORRELATION ANALYSIS
Correlation is single number that describes the degree of relationship between two variables
Correlation analysis is a process to find out the degree of relationship between two or more variable by applying various statistical tools
Example:price and supply
MEANING
It is used in deriving the degree and direction of relationship within the variable
It is used in developing the concept of regression
It is used in research work It is used reducing the range of
uncertainities in matter of prediction in the field of science this method are used
for making conclusions In the field of business
Uses of correlation analysis
Positive correlationwhen the value of two variable move in same
directionNegative correlationWhen the value of two varibles move in
opposite direction
Types of correlation
Simple correlation• correlation is said to be simple when only two varibles are analyse
Partial correlation
When three or more variable are considered for analysis but only in two influencing are studying and rest influencing varaible
Multiple correlation
In this three or more variables are studied
Linear correlation
If the amount of change in one variable leads to a constant ratio of change in another variable
Non linear correlation
If the amount in one variable is not in constant ratio to the change in the other variable
Importance of correlation analysis•Measure the degree of relation
•Estimating values of variables
•Understanding economic behaviour
THANK YOU