Question

Which among the following statements regarding correlation coefficient is/are correct? Group of answer choices Its absolute value cannot exceed 1. It only takes non-negative values. A positive value indicates a strong correlation between the two variables; a negative value indicates a week correlation between the two variables. If X and Y have positive correlation coefficient, when we run a regression analysis Y=a+bX+e, we will find b positive. If X and Y have positive correlation coefficient, when we run a regression analysis Y=a+bX+e, we will find a positive.

Answer 1

The correct statements regarding correlation coefficient are:

1. Its absolute value cannot exceed 1.

2. A positive value indicates a strong correlation between the two variables; a negative value indicates a weak correlation between the two variables.

3. If X and Y have positive correlation coefficient, when we run a regression analysis Y=a+bX+e, we will find b positive.

4. If X and Y have positive correlation coefficient, when we run a regression analysis Y=a+bX+e, we will find a positive.

Explanation:

Correlation measures the strength of the relationship which exists between X and Y variables. Regression, on the other hand, helps to establish a cause and effect between a dependent variable and an independent variable.