The correlation coefficient is a tool to help you understand how strong the relationship is between two different variables. When investing, it can be useful to know how closely related the movement of two vari
Question: What is the correlation coefficient that most closely approximates the scatterplot below? +1.0+0.60.0-1.0-0.5 Correlation and Scatter Plots: The correlation coefficient measures the relationship between variables numerically. On the other hand, a scatter...
The Pearson product-moment correlation coefficient depicts the extent that a change in one variable affects another variable. This relationship is measured by calculating the slope of the variables’ linear regression. The value of Person r can only take values ranging from +1 to -1 (both values...
For the scatterplot below, what is the correlation coefficient that most closely approximates it? a. -0.5 b. 0.0 c. +0.6 d. +1.0 e. -1.0 Scatter Plot. The scatter plot is the plot or diagram that presents the relation b...
In other words, the relationship is so predictable that the value of one variable can be determined from the matched value of the other. The closer the correlation coefficient is to zero, the weaker the correlation, until at zero no linear relationship exists at all. ...
Image source: The Motley Fool.What is a coupon rate? When a bond is issued, everything you need to know about it is determined. Unlike stocks, whose values are variable, bonds have a predetermined value at maturity, as well as a set annual payment that comes with the investment. You ...
positive, the variables increase in the same direction, and if the covariance is negative, the variables change in opposite directions. As it can be seen in the equation above, the magnitude of the covariance depends on the scale of each variable (the size of the population or sample mean)...
Pearson coefficient is a type of correlation coefficient that represents the relationship between two variables that are measured on the same interval.
A correlation coefficient is a statistical measure of the degree to which changes to the value of one variable predict change to the value of another. In positively correlated variables, the value increases or decreases in tandem. In negatively correlated variables, the value of one increases as ...
A correlation coefficient is the statistical measure that will tell us whether there is a relationship between our two variables of interest, and if there is one, how strong that relationship is. The value of the correlation coefficient, ϝ (rho), ranges from -1 to +1. The closer to -...