Determine Rank Correlation Coefficient
A group of 8 accountancy students are tested in Quantitative Techniques and Law II. Their rankings in the two tests were as:
Student
Q.T. ranking
Law II ranking
d
d^{2}
A
2
3
-1
1
B
7
6
C
4
D
E
5
F
G
8
-3
9
H
Σd^{2} = 22
d = Q. T. ranking - Law II ranking
R = 1 - {(6Σd^{2})/(n(n^{2} -1))}
1 -{(6(22))/(8(8^{2} -1))} = 0.74
Hence we conclude that there is a reasonable agreement among student's performances in the two types of tests.
NOTE: in this illustration, if we are given the actual marks then we find r. R varies between -1 and +1.