Correlation

Correlation 2

Regression 1

Regression 2

100

Correlation ranges between these two numbers

-1 to +1

100

In lecture, there was an image showing a high correlation between chocolate consumption in a country and number of Nobel winners from a country. What was the confounding variable?

High GDP, high quality of life

100

What is the range of scale for R-Squared? What R-squared value would suggest a perfectly predicting model?

0 to 1. 1 suggests perfect.

100

what does the "hat" over the response variable mean?

predicted

200

Population correlation is a _____________ .

parameter

200

What happens to the sample correlation as the number of observations increases, if no bias in the sample?

it gets closer to the value of the population correlation, ie. becomes more stable

200

There are always an equal number of positive and negative error terms in a regression. T or F?

False

200

True or False? A lower R-squared value (vs. higher) means greater predictive power

False. A higher R-squared value means greater predictive power.

300

What is the hypothesized value of correlation in testing for significance?

0 (zero)

300

What calculation would you perform on "r" to arrive at R-squared?

You would square "r" to get R-squared

300

In the critical value approach method for hypothesis testing, will a test statistic with a higher or a lower magnitude give you a better chance of rejecting the Null hypothesis?

higher. The higher the magnitude (absolute value) of the test statistic the further out in the tail it goes, increasing your chance of reject the Ho and accepting the Ha.

300

If we summed up all the error terms against a true regression line, they would approximate this number.

0 (zero)

400

how do you pronounce the population parameter for correlation?

pronounce "roh" or "row"

400

If there is a 0.5% chance we incorrectly rejected the null hypothesis, what is the p-value?

0.005 (0.5%)

400

In hypothesis test for a simple regression, the formula for degrees of freedom is "n-2". Why is 2 subtracted?

2 variables (response and explanatory)

400

interpret the slope coefficient with the below information:

b1 = 2.5

x is debt (in $000's)

y in income (in $000's)

As debt increases by $1,000, income increases by $2,500

500

What is the name of the variable that links two highly correlated variables?

Confounding variable

500

An Eller undergrad is interested in testing whether an association exists between these two variables and surveys 32 randomly selected people in downtown Phoenix, asking them their student loan debt and salary. She finds the sample correlation to be 0.54. Assuming a significance level of 5%, what is the t-critical value? df = n-2

2.042

500

What is the difference between correlation and regression

You use regression to predict. Correlation only gives us strength of relationship between two variables.

500

interpret R-squared given the below information.

R^{2}=0.18

x is number of credit hours taken

y is hours per week watching Netflix

18% of the variation in hours per week watching Netflix is explained by the variation of the number of credit hours taken.