CORRELATIO

N AND
REGRESSION
 SCATTER PLOT
- It is a graph of the ordered pair (x,y) of
numbers consisting of the independent variable
x, and the dependent variable y.
Scatter plot is used to determine the nature of
the relationship between variables. The
relationship can be positive linear, negative
linear, curvilinear, or no discernible
relationship.
 CORRELATION
It is a statistical method used to determine if
there is a relationship between variables and the
strength of relationship.
 CORRELATION
Correlation Coefficient- measures how closely
the points in a scatter diagram are spread around
a line.
r – sample correlation coefficient
ρ – population correlation coefficient
◦  
The range of the correlation coefficient is from
– 1 to 1.
Value of r Relationship
Strong positive linear
Close to 1
relationship
Weak or n o linear
Close to 0
relationship
Strong negative linear
Close to – 1
relationship
Example: A Statistics professor at a state university wants to see
how strong the relationship is between a student’s score on a test
and his/her grade point average. The data obtained from the
sample follow

Test Score (x) 98 105 100 100 106 95 116 112

GPA (y) 2.1 2.4 3.2 2.7 2.2 2.3 3.8 3.4
SSxy = 22.7
SSxx = 362
SSyy = 2.78
r = 0.716
A marketing executive wishes to determine whether
there is a relationship between the number of
television commercials aired per week and the
number of sales (in thousand pesos) of a product.

Number of Ads 2 5 8 8 10 12
Sales 2 4 7 6 9 10
 REGRESSION
After the value of the correlation coefficient is
deemed to be significant, then an equation of
the regression line is determined.
 REGRESSION
The regression line is the data’s line of best fit.
The closer the points fit the regression line, the
higher the absolute value of r and the closer it
will be to 1 or -1.
 REGRESSION
In Algebra, the equation of a line is usually
given as y=mx + b. In Statistics, the equation of
the regression line is y’=a+bx, where a is the y
intercept and b is the slope of a line.
Formula for Regression line
◦  

y’ = a + bx
 The time x in years that an employee spent at a
company and the employee’s hourly pay, y, for 5
employees are listed in the table below. Calculate and
interpret the correlation coefficient r. Also, determine
the regression line equation.

Years in the Company 5 3 4 10 15

Employee’s hourly pay
(hundreds)
650 600 610 750 780
The table below shows the height, x, in inches and
the pulse rate, y, per minute, for 9 people. Find the
correlation coefficient and interpret your result. Also,
find the equation of the regression line.

HEIGHT 68 72 65 70 62 75 78 64 68
PULSE RATE 90 85 88 100 105 98 70 65 72
From the following data of hours worked in a factory (x)
and output units (y), determine the regression line of y on x,
the linear correlation coefficient and determine the type of
correlation.