Question

In: Statistics and Probability

Determine the linear correlation coefficient between square footage and asking price. Square Footage, x Selling Price...

Determine the linear correlation coefficient between square footage and asking price.

Square Footage, x Selling Price ($000s), y

2209 380.7

3323 396

1105 186.3

1953 334.5

3225 639.7

2741 365.7

3987 608

2147 367

2536 413.6

1632 286.2

1749 265.3

3882   700.2

r= ?

Solutions

Expert Solution

Solution:
Correlation coefficient can be calculated as
n*Summation(XY) - Summation(X)*Summation(Y)/sqrt(n*summation(X^2)-(Summation(X))^2)(n*Summation(Y)^2 - (Summation(Y))^2)) =

X

Y

X^2

Y^2

XY

2209

380.7

4879681

144932.49

840966.3

3323

396

11042329

156816

1315908

1105

186.3

1221025

34707.69

205861.5

1953

334.5

3814209

111890.25

653278.5

3225

639.7

10400625

409216.09

2063032.5

2741

365.7

7513081

133736.49

1002383.7

3987

608

15896169

369664

2424096

2147

367

4609609

134689

787949

2536

413.6

6431296

171064.96

1048889.6

1632

286.2

2663424

81910.44

467078.4

1749

265.3

3059001

70384.09

464009.7

3882

700.2

15069924

490280.04

2718176.4

30489

4943.2

86600373

2309291.54

13991629.6


Correlation = (12*13991629.6) - (30489*4943.2) / sqrt((12*86600373 - 30489*30489)(12*2309291.54 - 4943.2*4943.2)) =

17186330.4/sqrt(109625355*3276272.24) = 0.9069

orchestra answered 1 year ago
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