Module 4

MODULE-4: CORRELATION & REGRESSION
1) Calculate Karl Peearson’s Coefficient of correlation between expenditure on

advertising and sales from the data given below:
8 marks
Advertisin Sales
g (lakh
axpenses Rs)
(‘000 Rs)
39 47
65 53
62 58
90 86
82 62
75 68
25 60
98 91
36 51
78 84
2) Define ‘correlation’ and ‘regression’. What do you mean by
i) Positive correlation
ii) Negative correlation
iii) Linear correlation
iv) Non-linear correlation
v) No correlation 7
marks
3) What is correlation analysis? List out and explain briefly the methods of
studying correlation? 6 marks
4) Calculate Rank correlation coefficient between marks assigned to 10 students

by judges X and Y in certain competitive test.
6 marks
Marks given by Judge X 52 53 42 60 45 41 37 38 25 27
Marks given by Judge Y 65 68 43 38 77 48 35 30 25 50
5) The given below data relate to the score obtained by 9 salesmen of company
in an intelligence test and their weekly sales in thousands of rupees.
8 marks
Salesme A B C D E F G H I
n
Intelligen 50 60 50 60 80 50 80 40 70
ce test
score
Weekly 30 60 40 50 60 30 70 50 60
sales
i) Obtain the regression equation of sales on intelligence test scores of
the salesmen.
ii) If the intelligence score of salesmen is 65, what would be his

expected sales?
6) What is meant by correlation? Briefly explain scatter diagram.

8 marks
7) Define correlation. Explain the various types of correlation with suitable

examples. 8 marks
8) What is Regression? Explain properties of regression lines. 7

marks
9) What is meant by correlation analysis? What are the different types of

correlation? Also list the differences between perfect positive and perfect
negative correlation. 8 marks
10) Calculate the regression equation of X on Y from the following data.

5 marks
X: 1 2 3 4 5
Y: 2 5 3 8 7
11) Calculate the rank correlation coefficient for following marks of 2 tests
given to a candidate for a clerical job.
8 marks
First test : 92 89 87 86 83 77 71 63 53 50
Second test : 68 83 91 77 68 85 52 82 37 57
12) Find out the correlation of correlation by Karl Pearson’s method
between X and Y. 8 marks
X: 57 42 40 33 42 45 42 44 40 56 44 43
Y: 10 60 30 41 29 27 27 19 18 19 31 29
13) Calculate Karl Pearson’s coefficient of correlation between expenditure

on advertising and sales from the following data.
12 marks
Advertising expenses (Rs.1000) : 39 65 62 90 82 75 25 98 36 78
Sales (Rs. Lakh) : 47 53 58 86 62 68 60 91 51 84
14) From the following data, obtain the two regression equations.
12 marks
Sales : 91 97 108 121 67 124 51 73 111 57
Purchases : 71 75 69 97 70 91 39 61 80 47
15) Calculate Karl Pearson’s coefficient of correlation from the following

data using 20 as the working mean for price and 70 as working mean for
demand. 5 marks
Price : 15 16 17 18 19 20 21 22 23
Demand : 84 78 70 75 66 67 62 58 60
16) A researcher wants to find the relationship, if any between the heights
of sons and the heights of the fathers. He took a randam sample of six
fathers and their six sons. Their heights in inches are given below. Find the
regression line of y and x and hence find the height of son if father’s height is
70 inches. 8 marks
Height of 63 65 66 67 67 68
father(X)
Height of 66 68 65 67 69 70
son(Y)
17) Calculate Rank correlation for following data
7 marks
Maths 85 60 73 40 90
marks(X)
Statistics 93 75 65 50 80
marks(Y)
18) A financial analyst wanted to find out whether inventory turnover

influences any company’s earnings per share (in percent). A random sample
of 7 companies listed in a stock exchange were selected and the following
data was recorded for each: 8 marks
Item of expenditure ________Family ________Family B________

A________ (Monthly income Rs
(Monthly income Rs 40000)
30000)
A 4 11
B 5 9
C 7 13
D 8 7
E 6 13
F 3 8
G 5 8
Using spearmen’s rank correlation, find the strength of association between
inventory turnover and earnings per share. Interpret the findings.
19) Use least squares regression line to estimate the increase in sales
revenue expected from an increase of 7.5 percent in advertising expenditure.
5 marks
Firm A B C D E F G H
Annual % increase in 1 3 4 6 8 9 11 14
Advertising exp
Annual % increase in 1 2 2 4 6 8 8 9
Sales exp
20) The following data relate to the age of employees and the number of
days on which they reported sick in a month:
7 marks
Age: 20 30 32 35 40 46 52 55 58 62
Sick 1 2 0 3 4 6 5 7 8 9
days
:
Calculate Karl pearson’s coefficient of correlation and interpret its value.
21) The following data relate to advertising expenditure (in lakhs) and
their corresponding sales(in crores):
10 marks
Advertising expenditure: 10 12 15 23 20
Sales: 14 17 23 25 21
Estimate: i) sales corresponding to advertising expenditure of Rs.30 lakhs

and
Ii. The advertising expenditure for a sales target of Rs.35 crore.

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MODULE-4: CORRELATION & REGRESSION

1) Calculate Karl Peearson’s Coefficient of correlation between expenditure on

ii) Negative correlation

iii) Linear correlation

iv) Non-linear correlation

4) Calculate Rank correlation coefficient between marks assigned to 10 students

Marks given by Judge X 52 53 42 60 45 41 37 38 25 27

Marks given by Judge Y 65 68 43 38 77 48 35 30 25 50

ii) If the intelligence score of salesmen is 65, what would be his

6) What is meant by correlation? Briefly explain scatter diagram.

7) Define correlation. Explain the various types of correlation with suitable

8) What is Regression? Explain properties of regression lines. 7

9) What is meant by correlation analysis? What are the different types of

10) Calculate the regression equation of X on Y from the following data.

13) Calculate Karl Pearson’s coefficient of correlation between expenditure

Advertising expenses (Rs.1000) : 39 65 62 90 82 75 25 98 36 78

Sales (Rs. Lakh) : 47 53 58 86 62 68 60 91 51 84

Sales : 91 97 108 121 67 124 51 73 111 57

15) Calculate Karl Pearson’s coefficient of correlation from the following

18) A financial analyst wanted to find out whether inventory turnover

Item of expenditure ________Family ________Family B________

Calculate Karl pearson’s coefficient of correlation and interpret its value.

Estimate: i) sales corresponding to advertising expenditure of Rs.30 lakhs

Ii. The advertising expenditure for a sales target of Rs.35 crore.

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Item of expenditure Family Family B