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UDAU M6 Correlation & Regression

The document discusses linear correlation and linear regression. It defines correlation as measuring the relationship between paired variables and identifies three degrees of correlation: perfect, some, and no correlation. It provides examples of correlated variables and measures of correlation using Pearson's r correlation coefficient. Linear regression finds the linear relationship between a dependent and independent variable and predicts values using the regression line equation. The standard error of estimate measures how far data points deviate from the regression line. Multiple regression allows predicting a dependent variable from multiple independent variables using a multiple regression equation.

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155 views26 pages

UDAU M6 Correlation & Regression

The document discusses linear correlation and linear regression. It defines correlation as measuring the relationship between paired variables and identifies three degrees of correlation: perfect, some, and no correlation. It provides examples of correlated variables and measures of correlation using Pearson's r correlation coefficient. Linear regression finds the linear relationship between a dependent and independent variable and predicts values using the regression line equation. The standard error of estimate measures how far data points deviate from the regression line. Multiple regression allows predicting a dependent variable from multiple independent variables using a multiple regression equation.

Uploaded by

Alizah Bucot
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© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Chapter 6

Linear Correlation &


Linear Regression
A. Linear Correlation
⚫ Correlation – measures the degree
and direction of the relationship
between paired variables.
⚫ 3 Degrees of Correlation
⚫ 1. perfect (±) correlations
⚫ 2. some degree of (±) correlation
⚫ 3. no correlation
Degrees of Correlation
Interpretation
Examples of Correlation:
⚫ Weight vs. Height (tall people tend to be
heavier than small people)
⚫ GNP vs. Aggregate Investment
⚫ Work Output vs. Work Experience
⚫ Statistics vs. Technical Writing
⚫ Computer Literacy vs. Personality
⚫ Wine Consumption vs. Illness
⚫ Students’ Grades vs. # of Hours spent in
Studying
Measures of Correlation
Pearson r Correlation

r= N(∑XY) – (∑X)(∑Y)
√[N(∑X2) – (∑X)2][N(∑Y2) – (∑Y)2
Extent of Correlation Between Paired
Variables
⚫ 0.00 - ±0.09 - No Correlation
⚫ ±0.10 - ±0.20 - Negligible Correlation
⚫ ±0.21 - ±0.40 - Low Correlation
⚫ ±0.41 - ±0.60 - Substantial Correlation
⚫ ±0.61 - ±0.80 - Marked Correlation
⚫ ±0.81 - ±0.99 - High to Very High Corr.
⚫ ±1.00 - Perfect Correlation
Example:
⚫ Table 1 presents data relating the number
of weeks of experience in a job involving
the wiring of miniature electronic
components and the number of
components which were rejected during
the past week for 12 randomly selected
workers.
⚫ i) Compute the correlation coefficient for
the data.
⚫ ii) Test if the correlation is significant.
Table 1: Weeks of Experience & Number of
Components Rejected During a Sampled
Week for 12 Assembly Workers

Sampled 1 2 3 4 5 6 7 8 9 10 11 12
Worker

Wks. Of
Experie 7 9 6 14 8 12 10 4 2 11 1 8
nce (X)

# of
Rejects 26 20 28 16 23 18 24 26 38 22 32 25
(Y)
W X Y X2 y2 XY
1 7 26 49 676 182
2 9 20 81 400 180
3 6 28 36 784 168
4 14 16 196 256 224
5 8 23 64 529 184
6 12 18 144 324 216
7 10 24 100 576 240
8 4 26 16 676 104
9 2 38 4 1444 76
10 11 22 121 484 242
11 1 32 1 1024 32
12 8 25 64 625 200
∑X=92 ∑Y=298 ∑X2=876 ∑Y2=7798 ∑XY=2048
Solutions:
⚫ i.1. Using Pearson (r)
r= 12(2,048) – (92)(298)
[12(876)–922][12(7,598)–2982]
r = - 0.908 ≈ 0.91
very strong negative
correlation
ii. Test for Significance
⚫ Ho: r = 0 Ha: r ≠ 0
⚫ ά(.05) = 0.5760 ά(.01) = 0.7079
⚫ df = n – 2 = 12 – 2 = 10
⚫ rc rt
⚫ - 0.908 > - 0.7079 , reject Ho
⚫ The computed r is significant, which implies
that a very strong negative correlation exist
between the 2 variables. The (-) correlation
means that the longer the work experience in a
job involving the wiring of miature component,
the lesser the number of rejected components.
B. Linear Regression

⚫- is a technique used to
approximate or predict the
values or relationship between
dependent and independent
(predictor) variable.
Regression Techniques
⚫ 1. Scatter Diagram – visual or graphical
method of determining the relationship of
paired data.
⚫ 2. Equation of the Regression Line
(least-squares line) – is used as a
predictor of the y-values.
⚫ 3. Standard Error of Estimate (Se) –
measures the amount of spread of the
sample points about the regression line.
Formulas:
⚫ Equation of the Regression Line
⚫ Ypred. = mx + b
⚫ b = Ῡ - mX Ῡ = ∑Y/n
⚫ m = n(∑XY) - ∑X∑Y X = ∑X/n
⚫ n∑X2 – (∑X)2
⚫ Standard Error of Estimate
⚫ Se = ∑Y2 – b(∑Y) – m(∑XY)
⚫ n–2
Examples:
⚫ 1. Each of the following pairs represents
the number of licensed drivers (X) and the
number of cars (Y) for houses in a posh
village in Metro Manila. Predict the
number of cars for each of 2 new families
with 2 and 5 drivers.
⚫ Drivers(X) | 5 5 2 2 3 1 2
⚫ Cars(Y) | 4 3 2 2 2 1 2
Solution:

X Y XY X2 Y2
5 4 20 25 16
5 3 15 25 9
2 2 4 4 4
2 2 4 4 4
3 2 6 9 4
1 1 1 1 1
2 2 4 4 4
∑X= 20 ∑Y=16 ∑XY=54 ∑X2=72 ∑Y2=42
⚫X = ∑X/N = 20/7 = 2.86
⚫ Ῡ = ∑Y/N = 16/7 = 2.29
⚫ m = n(∑XY) - ∑X∑Y = 7(54) – (20)(16)
⚫ n∑X2 – (∑X)2 7(72) – (20)2
⚫ m = 0.56
⚫ b = Ῡ - mX = 2.29 – (0.56)(2.86) = 0.69
⚫ Ypred. = mx + b = 0.56X + 0.69
⚫ If x=2, Ypred. = 0.56(2)+0.69 = 1.81≈ 2
⚫ If x=5, Ypred. = 0.56(5)+0.69 = 3.49≈ 4
⚫ 2. The following is the length of time that 10
job applicants for employment abroad have
studied College and their scores in a proficiency
test in English.
Yrs. In College| 5 3 2 3 4 2 3 4 4 5
Scores in Eng. |84 63 48 75 78 58 57 72 73 89
a. Construct a scatter diagram.
b. Find the equation of a regression line.
c. Sketch the graph of the regression line.
d. Compute for Se.
e. If X = 4 ½ , what is Ypred. ?
⚫ a)
Solutions:
⚫ 90 ·
⚫ ·
⚫ 80 ·
⚫ · ··
⚫ 70
⚫
⚫ 60 ·
⚫ · ·
⚫ 50
⚫ ·
⚫ 1 2 3 4 5
X Y XY X2 Y2
5 84 420 25 7056
3 63 189 9 3969
2 48 96 4 2304
3 75 225 9 5625
4 78 312 16 6084
2 58 116 4 3364
3 57 171 9 3249
4 72 288 16 5184
4 73 292 16 5329
5 89 445 25 7921
∑X=35 ∑Y=697 ∑XY=2554 ∑X2=133 ∑Y2=50085
⚫ b) Ῡ = 697/10 = 69.7
⚫ X = 35/10 = 3.5
⚫ m = 10(2554) – (35)(697) = 10.9
⚫ 10(133) – 352
⚫ b = 69.7 – 10.9(3.5) = 31.55
⚫ Ypred.= 10.9x + 31.55
⚫ e) If X= 4½,
⚫ Ypred. = 10.9(4.5)+31.55= 80.6 ≈ 81
⚫ d) Standard Error of Estimate

⚫ Se = 50,085 – 31.55(697) – 10.9(2554)


⚫ 10 – 2

⚫ Se = 0.47
Multiple Regression
Analysis

-allows you to measure how


much of the variation in a series
can be attributed to another
series.
Multiple Regression
Analysis
- is used when we have several
variables that we can use to
predict what we’re interested in.
Multiple Regression Equation
Y = b0 + b1X1 + b2X2 + … + bnXn
where:
•Y is the dependent variable to be predicted
•b0is the intercept
•x1, x2, x3, ..., xnare the the known independent
variables that may influence y
•b1, b2, b3, ..., bnare the numerical constants
which must be determined from the observed
data
Thank you

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