Question

In: Statistics and Probability

Please provide a few "real-world" explanations of positive or negative correlations? Such as, the "monthly electric...

Please provide a few "real-world" explanations of positive or negative correlations?

Such as, the "monthly electric bill will increase as the outside temperature increases."

Solutions

Expert Solution

Positive Correlation:

A positive correlation is a relationship between two variables where if one variable increases, the other one also increases. A positive correlation also exists in one decreases and the other also decreases.

Examples:

  1. Monthly electric bill will increase as the outside temperature increases
  2. As the temperature goes up, ice cream & Cold Drinks sales also go up.
  3. As you drink more coffee, the number of hours you stay awake increases.

Negative Correlation:

A negative correlation means that there exists an inverse relationship between two variables - when one variable decreases, the other increases. The vice versa is also a negative correlation too, in which one variable increases and the other decreases.

Example:

  1. If a car decreases speed, travel time to a destination increases or if a car increases speed, travel time to a destination decreases.
  2. As one exercises more, his body weight becomes less.

Please let me know for any doubts.


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