Question

The following is a scatter plot for profits versus sales (in tens of thousands of dollars) for a random sample of 11 large companies. The correlation between sales and profits is 0.949.A. There is a positive association between x and y.B. If we removed the outlier, r would not change much.C. If we removed the outlier and recreated the scatterplot, we would have the same basic impression of the relationship between sales and profit.D. None of the above

Answer 1

Answer:

A. There is a positive association between x and y

Step-by-step explanation:

The correlation between two variable is a statistics which show the association between the variables.

The correlation value ranges between -1 and +1.

• a negative value means the variables are negatively related. For example price and demand are negatively correlated. If price increases, demand decrease and vice versa.
• a positive value means a positive relationship. For example, income and expenditure have positive relationship. In general, as income increases, you spend more.
• as the correlation value is closer to 1 or -1, it means that the relationship is stronger. A correlation value of 0 means there is no relationship between the variables.