Correlation Coefficient  Summary and Q&A
TL;DR
Learn how to calculate the correlation coefficient, which indicates the strength and direction of the linear relationship between two variables, using a stepbystep formula.
Questions & Answers
Q: What does the correlation coefficient tell us?
The correlation coefficient provides information about the strength and direction of the linear relationship between two variables. It ranges from 1 to 1, with 1 indicating a perfect positive relationship and 1 indicating a perfect negative relationship.
Q: How is the correlation coefficient calculated?
The correlation coefficient formula involves summing the products and squares of the variables, as well as their sums. These values are then plugged into the formula to calculate the correlation coefficient.
Q: What does a correlation coefficient of 0.8 signify?
A correlation coefficient of 0.8 suggests a strong positive linear relationship between the variables. The closer the value is to 1, the stronger the relationship.
Q: What does a correlation coefficient of 0 indicate?
A correlation coefficient of 0 indicates that there is no linear relationship between the variables. The values are not related in any way.
Summary & Key Takeaways

The correlation coefficient measures the degree of linear relationship between two variables.

A positive correlation coefficient indicates a direct relationship between the variables, while a negative coefficient indicates an inverse relationship.

The correlation coefficient ranges from 1 to 1, with values closer to 1 or 1 indicating a stronger linear relationship.