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LINEAR CORRELATION — Statistics STD 12 Commerce — Question

Gujarat BoardEnglish MediumSTD 12 CommerceStatisticsLINEAR CORRELATION2 Marks
Question
Explain the meaning of negative correlation with illustration.
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Answer

  • For two correlated variables, if the value of one variable increases then the value of other variable decrease means both the variables increase and decrease in the opposite direction and there is a cause effect relation between the two variables then we can say there is negative correlation between the two variables.
  • Person's expenditure and savings, the minimum temperature in a day during winter and sale of woollen clothes, price of a commodity and its demand, elevation from sea level and amount of oxygen in air etc are the examples of negative correlation.
  • There is a negative correlation between price of a commodity and its demand in the following example.
  • When there is increase in price of commodity, there is a decrease in its demand.
Price of commodity$($in $Rs.)$ $10$ $12$ $15$ $20$ $25$ $30$ $45$
Demand of commodity $($in units$)$ $130$ $120$ $100$ $95$ $90$ $84$ $80$

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