Important Issues and Parameters for Analyze Phase

Pearson's correlation coefficient (r)

Assesses whether two continuous variables are linearly related. For example, you have a sample
of plastic and want to know if the rate of cooling is associated with the plastic's strength.
The coefficient will fall between -1 and +1. The closer the absolute correlation is to 1 the more
tightly the data points fall on a line

Important considerations:
Correlation does not necessarily imply causation. Only controlled experiments allow you to
determine causality. For instance, while ice cream consumption and the number of flu cases may
be negatively correlated it does not follow that increased ice cream consumption causes the flu
rate to decrease. Rather, a confounding variable such as temperature is likely to be at work.
A single extreme value can greatly affect the coefficient. Look for outliers and consider
their effect.
To see how well a model fits the data, you can calculate the percentage of the variance
accounted for (R ) by squaring the correlation coefficient and multiplying by 100. For example:
a correlation (r) of 0.20 will account for only 4% of the variance, r=0.71 accounts for 50%, and
r=0.90 accounts for 81%.
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