QUANTITATIVE ANALYSIS DEC 2023 Q5c(correlation and regression analysis)

QUANTITATIVE ANALYSIS DEC 2023 Q5c(correlation and regression analysis)

Quantitative analysis involves the use of mathematical and statistical methods to evaluate and analyze numerical data. In the context of correlation and regression analysis, these methods are used to examine the relationships between variables. Here's a description of these concepts:

Correlation Analysis
Correlation analysis is used to measure and interpret the strength and direction of the relationship between two continuous variables.

Pearson Correlation Coefficient (r): This measures the linear relationship between two variables. The value of r ranges from -1 to 1:
+1 indicates a perfect positive linear relationship.
0 indicates no linear relationship.
-1 indicates a perfect negative linear relationship.
Spearman's Rank Correlation Coefficient: This non-parametric measure assesses how well the relationship between two variables can be described using a monotonic function. It’s used when the assumptions of Pearson's correlation are not met.
Regression Analysis
Regression analysis is used to model the relationship between a dependent variable and one or more independent variables. The goal is to understand how the dependent variable changes when any one of the independent variables is varied.

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