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Correlation Analysis
Correlation Analysis is performed to measure the degree of association between two variables. The measure is called coefficient of correlation. The coefficient of correlation is also said to be a measure of covariance between two series. Of the several mathematical methods of measuring correlation, the Karl Pearson's method, popularly known as Pearson's coefficient of correlation is most widely used in practice.
while the Statistic r is given by r =
A simple formula is
r
The correlation coefficient describes not only the magnitude of the correlation but also its direction.
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