Business Statistics

Definition: The Regression Equation is the algebraic expression of the regression lines. It is used to predict the values of the dependent variable from the given values of independent variables. If we take two regression lines, say Y on X and X on Y, then there will be two regression equations: Regression Equation of Y on X: This is used to describe the variations in … [Read more...] about Regression Equation

Definition: The Regression Coefficient is the constant ‘b’ in the regression equation that tells about the change in the value of dependent variable corresponding to the unit change in the independent variable. If there are two regression equations, then there will be two regression coefficients: Regression Coefficient of X on Y: The regression coefficient of X on Y is … [Read more...] about Regression Coefficient

Definition: The Regression Line is the line that best fits the data, such that the overall distance from the line to the points (variable values) plotted on a graph is the smallest. In other words, a line used to minimize the squared deviations of predictions is called as the regression line. There are as many numbers of regression lines as variables. Suppose we take two … [Read more...] about Regression Line

Definition: The Regression Analysis is a statistical tool used to determine the probable change in one variable for the given amount of change in another. This means, the value of the unknown variable can be estimated from the known value of another variable. The degree to which the variables are correlated to each other depends on the Regression Line. The regression line is … [Read more...] about Regression Analysis

Definition: The Method of Least Squares is another mathematical method that tells the degree of correlation between the variables by using the square root of the product of two regression coefficient that of x on y and y on x. The numerical notation of the formula to calculate the correlation by the coefficient method of least squares is given below: Lag and Lead in … [Read more...] about Method of Least Squares

Definition: The Spearman’s Rank Correlation Coefficient is the non-parametric statistical measure used to study the strength of association between the two ranked variables. This method is applied to the ordinal set of numbers, which can be arranged in order, i.e. one after the other so that ranks can be given to each. In the rank correlation coefficient method, the ranks … [Read more...] about Spearman’s Rank Correlation Coefficient

Definition: Karl Pearson’s Coefficient of Correlation is widely used mathematical method wherein the numerical expression is used to calculate the degree and direction of the relationship between linear related variables. Pearson’s method, popularly known as a Pearsonian Coefficient of Correlation, is the most extensively used quantitative methods in practice. The … [Read more...] about Karl Pearson’s Coefficient of Correlation

Definition: The Scatter Diagram Method is the simplest method to study the correlation between two variables wherein the values for each pair of a variable is plotted on a graph in the form of dots thereby obtaining as many points as the number of observations. Then by looking at the scatter of several points, the degree of correlation is ascertained. The degree to which the … [Read more...] about Scatter Diagram Method

Definition: The Correlation is a statistical tool used to measure the relationship between two or more variables, i.e. the degree to which the variables are associated with each other, such that the change in one is accompanied by the change in another. The correlation is said to be linear when the change in the amount of one variable tends to bear a constant ratio to the … [Read more...] about Methods of Determining Correlation

Definition: A statistical tool used to measure the relationship between two or more variables such that the movement in one variable is accompanied by the movement of another is called as Correlation. Types of Correlation   Positive and Negative Correlation: Whether the correlation between the variables is positive or negative depends on its direction of change. … [Read more...] about Types of Correlation