YS_l.;;;.S_ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _,1!!

ffffi:!LA~Tl=O:N:A~N;;;..~;;;;;L....
gf!;..-- 181
soLUTION:
pays Price Demand (x x) (Y-y) (x x)(y-y) (x xt (y y)z
r,1on 22 10 +2 -8 -16
30 12 +10 4 64
Tue -6 -60 100 36
Wed 25 15 +5 -3 -15 25
20 20 9
Th 0 +2 0
15 23 0 4
Fri -5 +5 -25 25 25
Sat 8 28 -12 +10 120 144 100
'; = 6 120 .&-108
2:(x -x)(y- y) 2:(x-x)2 2:(y-y)2
- 236
- 298 238

l:x 120 _ l:y 108

i=-=-=20 Y=-=-=18
n 6 n 6 •
l:(x-xXy-y) -236 236
r = .,/2:(x- x)2 :r(y- y) 2 = x 238 = - 266.32 = -0.
886•

Price and Demand are negatively correlated in this example.

r.JE[Alw>:LE 6. Calculate the correlation coefficient from the following data:
12 9 8 10 11 13 7
y 14 8 6 9 11 12 3
Let now each value ofXis multiplied by 2 and then 6 is added to it. Similarly, each value
of Y is multiplied by 3 and 2 is subtracted from it. What will be the correlation coefficient
between the new series of X and Y?
SOLUTION:
X y xy x' l
12 14 168 144 196
9 8 72 81 64
8 6 48 64 36
10 90 100 81
9
11 11 121 121 121
13 156 169 144
12
7 21 49 9
3
_n..:;:7,I.x=70 ~y =676 ~2 = 728 ,&2 -651
I.),=63

l:xy- :rx.:ry
r= n
Ix2 - (Ix)2 :Ey2 - (:ry)2
n n
 ·o-•-·- . -.J

wing data relat e to the share. price s (in f Hundred) of two companies
turin g deco rativ e pain ts on different tradi ng days. Calculate Karl Pearson's
coefficient of corre latio n for these share prices:
-
Shar e price s of comp any X 3 7 5 4 6 8 2 7
Shar e price s of comp any Y 7 12 8 8 10 13 5 10
Ans. [r = 0.962)
Q. 18. Determine the valu e of coefficient of correlation from the following data:
Ixy =40, n =100, I,x2 =80, LY2 =20.
Ans. [r =· 1) •
the coefficient of corre latio n from the data given below and comment on the
. result:
Experience (x) 16 12 18 4 3 lO 5 12
Performance (y) : 23 22 24 17 19 20 18 21
Ans. [r = 0.9508)
Q. 26· If the covariance of 10 pairs of item s is 7, varia nce of Xis 36; I,(y - y) 2 = 9o, find
out r.
Ans 9)
• ht of five items is 6 and their stand ard
e_ c~variance betw een the leng th ~d wei~ e coefficient of correlation between
deviations are 2.45 and 2.61 respectively. Find th <DI!.!!.
Com H 2000 )
length and weig ht.
J\ns. [r = 0.938)
 18 3
eo_RRELA TION ANALYSIS
e:
rrelation in te rv al limits ar
Population coefficient of co
0.85.
P.E. =0 .7 ±0 .1 5= 0. 55 to llowing
la tio n be tw ee n ag e an d pl ay in g ha bi t of th e fo
rre
XAMPLE 9. Fi nd th e co
. 17 18 19 20
15 16 80
Age (years) 15 0 120 10 0
25 0 20 0
No. of stu de nt s : 90 48 30 12
20 0 15 0
Regular players : co ef ficient of co rre la tio n is
in t ou t wh et he r
er ro r an d po (D U B Co m H 19 96 )
Also ca lc ul at e pr ob ab le
significant. be r of
co nv er t re gu la r pl ay er as pe rc en ta ge of nu m
e r, we
SOLUTION: To ca lc ul at ge s as Y series. Age is tre at ed
as X series.
at th es e pe rc en ta
students and tre (x -x ){ y- y)
-x l (y -y ) (y -y y'
y (x -x ) (x
% 90 0 -7 5
-2 .5 6.2 5 +30
15 80 62 5 -3 7. 5
-1 .5 2.2 5 +25
16 75 100 -5
-0 .5 0.2 5 +1 0
17 60 100 -5
.5 0.2 5 -1 0
18 40 +0 -3 0
5 -2 0 40 0
+1 .5 2.2
19 30 1,225 -8 7. 5
6.2 5 -3 5
20 15 +2 .5 (x -x )( y- y)
x- x) =
2 (y -y )2 =
I:( =- 24 0. 0
Lt = 105 .& = 30 0 17.50
3,350

_ Iy 300
_ Ix 105 17 .5 y = -= -= 5 0 .
% = -= -= n 6
n 6
r= l:( x- x) (y -y )
y)2

r= -2 40 = _ 24 0 = -0 .99 1 _
'..J17.5x3,350 24 2.1 26
ciated.
tes th at ag e an d pl ay in g ha bi t ar e negatj'vely asso
Negative r indica

P.E.=0.6745
1
:;;f/
= o.6 74 5
1
-s; 82 o. 67 45 xO .O l8 /2 .4 49 =0.0049.
=

r is mo re th an 6 tim es th e P.E., r is significant.

Since ar e given
fro m th ei r re sp ec tiv e m ea ns of X an d Y se rie s
EXAMPLE 10 . Th e deviations
below:
2 3 4
-1 0 1
-3 -2
:c : -4 1 2 -2 -1
-4 0 4
Y: ,3 -3 m P 1995)
ici e~ t of co rre lat io n fro m th e above. (D U B Co
eff
Calculate Ka rl Pe ar so n's co
200 QUANTITATIVE TECHNIQUES

Dete rmin e the asso ciati on betw een the judg men ts of the two judg
es using
Spea rman 's rank correlation coefficient.
Ans. [r =0.7_07)
~no:;:;LYSIS
199

ate the rank correlation coe= .

uictent from th d t .
x. 75 88 e a a given below:
95 7
: 120 134 150 O 60 80 81 50
115
>,JlS• [,: 0.929] 110 140 142 100
Q or the following data, calculate the co ffi •
• . 80 91 e c1ent of rank correlation:
X. 99 71 61 81
y: 123 135 154 70 59
110 105 134 121 106
(CA Fdn May 2001)
~~0.95]
~culate the rank coefficient of correlation from the fio11owmg data:
Student: 1 2 8 4 5 6 7 8
Score in
Mathematics 80 79 60 70 95 88 75 50
Statistics 62 60 32 37 70 56 41 29
(CA Fdn May 2008)
~_:):-= 0.93)
.Y, ~culate rank correlation coefficient between the two series X and Y, given below:
X: 70 65 71 62 58 69 78 • 64
y: 91 76 65 83 90 64 55 48 ••,
Also comment on the result. (CAFdnNov 1996)
Am. Ir• - 0.311
Q, 7. The coefficient of rank correlation of the grade points obtained by 10 employees of a
firm awarded by their foreman and floor manager was found to be 0.8. It was later
discovered that the difference in the grade points obtained by an employee was
wrongly noted as 7 instead of 9. Find the correct coefficient of rank correlation.
Ans. lr - 0.61]
~culate rank correlation coefficient from the following data:
S. No.: 5 6 7 8 9 10
1 2 s 4
14 67 24 19 65
x: 48 33 40 9 18
20 9 5 19
y: 12 13 29 6 15 4
(CA PE- I May 2004)
~-)0.72)
Two judgesrank anumb erof competitors in a certain art competition as follows:
-
Judge CompetitoT'tl
11 12
-
,__A. 5
l
1
2 s
2
4
7
5
3
6
6
7
8
8
10
9
9
10
11 12
4 11 9 12
·4 7 6 8
..__B 10 5 1 2 3
( . _ :-:·t~~:::e:~~n ~~uation of yon X where Y and X are the marks obtained by 10
16
students are as given below:
Y· 20 60 55 45 75 35 25 90 10 50
x: 20 45 65 40 55 35 15 80 25 50
( CA Fdn May 2002)
•

.ty1s. [Y = 1.105X - 1.015)].

,ti 17.The values ofX and Y are given in the following table:
5 4 8 12
X: 3 5
Y· 18 14 12 10 9 7
Find the two regression equations. .
(b) Multiply each value of X by 2 and then add 6. Multiply each value of Y by 3 and
subtract 16 and then find:
(i) The two regression coefficients.
(ii) The two regression equations. (DUB Com H 1995)
Ans. [(a) Y = 17.476- 0.942X; X = 10.903 - 0.406Y; (b) (i) byx = - 1.413; bx,= -0.271; (ii) Y =
- 1.413 X + 44.904; X = 23.482- 0.271Y].
18. The HR manager of ANOMALY Internationa l wants to study the relationship
between number of years of experience and performance score of the employees. An
analysis of 5 employees shows the following results:
No. ofYears Performanc e
Experience (X) I Score (Y)
6 19
2 11
10 25
4 18
8 17
(i) Fit a regress1on equation of Y on X
t./4i) Calculate the likely performance s~ore if experi~~ce is 5 years·
(iii) C~cula~e the standard error of estimate and comment on t~e reliability of tbe
. estimating equation. (DU MHROD 2006)
Ans. [(i) Ye= 9.9 + l.35X; (ii) 16.65; (iii) s = 2 _331
Q. 19.A building contract • • t yx . • • ·st
or is m erested m knowing whether relationship does eSlcb
between the number of buildin • • f su )
buildin · g permits issued and the volume of sales O
gs m some paSt years. He collects data about sales (Y, in thoU:sands of rupees