cut method. Direct Method: Individual Series The following steps are to be followed to calculate Pearson's coefficient of correlation, direct method: 1. Calculate Arithmetic Mean of x and y series. 2. Find out deviations of both x and y series from their respective arithmetic means denote it by dr and dy 2 de =x—% and y= y-F 3. Square the deviations and find the total. It is denoted by de? and Yar 4. The individual dr and dy values The values are substituted in the form Formula: Y= y = Pe Zdedy = To meg2 a 2 Cota between sales ad roi Nyoswom | ef ats el stat als [= [10] Weeeo@lete rst tt ay 9] NS ene OOO [PAIRS Oy | ssa [a Tow Tor | a | e 2 5 | ms f 7 | © | 3s » 3 35 125 +4 % 210 » 5 25 25 “4 16 100 2 7 as | mw | 2 4 » 2 8 5 Bb a 1 5 a 9 Ss Bb 0 0 0 nv W 1S Bs 2 4 0 2 2 B @s 3 9 B a 4 35, 125 a 3B 175 00 450 1390Mlustration: 3 Calculate Karl Pearson's coefficient of correlation between X and Y and comment g relationship. “ sees Sees Sakae Soo we op 7000 x, a 70250000 1012500 1802000 17530625 — sis 200 3000-125 13625 6250000 31200, 20 4000 78 5625 BO peed m0 5003s 2 ap a ee cane ap m* te a ges 2230000 112500 450 012518625 6250000 312500 500 9000 17530625 tp2s0000 oe 550 10000 Ds 50625 20250000 1012500 350 55000 206250 82500000 4125000 Arithmetic Mean of X series (¥) = = = eae Arithmetic Mean of Y series (¥) = 2 bl ™ oe Coefficient of Correlation between sales Zdedy Ede? x Edy? 4125000 206250 x 82500000 = 4125000 454.1476 x 9082.95 4125000 ~!ie —_ 4 Caleulate Pearson's co-efficient of correlation between x and y by So) ou) | S| Sale | o/[ ov] a] »| » 10 using the given informatio,ee es nm» % : kx 600 a « nF) "WT GQ 760 of X serie N” 10 = “ ty $80 ’ pean of series (FV) = QV fg 88 eatin between sales and profits = y = Ee corre as eoy et ty) o 59 250 285 a) 2250 ait 5 pearsonscoeisient of cortelation between x eis andy ey je K 0] mo [50 | 2 [0 [os Tis iw, ey rol oi 1 3) 0) s | oT stay x 3 eg et yada ad —— oe eT 5 a a | ee” good x61 3 9 5 | ™ x 9 8 - 1 9 fe ety: RSG 361 4 % rm | ™ 1 1 4 6 4 0 3 “4 6 9 A 6 6 256 4 196 om 3 4 1 2 a 21 41 3 26 676 16aS STClent Of Correta Smeaton been sales nd profits “1 les and pro Tea x bat? xa 540 «3290 558 lustrati lon: 6 1 pearsons coefficient of cong, B Using the following information eaeuate KP Xseries [a] 16 Yseries [a | @ Arithmetic mean of x series is 22 am Solution: We have to find the mising value inthe y SS Let us assume that missing value is A +76 +80:+80 _ 9 By _ 524624 65+At OT — N 7 Arithmetic Mean of ¥ series (7) cy series is = 413 +A=69%7 = 413 +A=783 1A = 483-413 =70 cA=D Sau pan ee 2 dedy us 2 & a a7 299 136 6 e@ 6 % a 9 2 es 6 4 6 4 6 16 » D 2 4 1 1 2 4 ® : 4 7 ° 4 a) 8 2 Ty 0 134yes of Retation a Ededy of Correlation between sales and profits = Y= coefficient p* tea Eee 384 ~ YPr88 « 606 1 394 | “ana” 08 jon: 7 a a ge given information, find out the co-efficient of correlation between 10 items of yy vs wes and 7 2068 x Y ‘Number of items 0 10 ‘Arithmetic Mean 55. 3 Sum of squares of deviations 250) TA Sum of Products of deviations of x and y 7350 ‘Solution: Ede kar Pearson's coefficient of correlation: y = ay Noxoy Given information is Tddy=2350, Dak? = 8250, Ede? = 724,N= 10 va? _ (8250 ox = $= = 2s = 28.7 N iar _ Sra “Wo 7 V4 = 8.509 oy= Edy 2350 Noxoy ~ 10x28.7x851 77° calculated from act tual mean. If the Arithmeti becomes a commie awe tn ch inationOnan of etic INEae (2a) x[ NB - Sb = Tap of nm Sap = Tat of devin of res ~ Total of deviations of 6088, B= Tt of squared deviations of series = Til f squared deviations of 5665 ' N= Number of tems (umber fir of Hem) The flowing ithe expenditure cpt orm net and the prof, Years. Calculate coefficient of correla ‘sn wperersfel ete lsters [Advening onr oop] 5] 5] 51213 2/3] 8! Profs Rs. 000" meter ste Pl | e Tavis pies ete a >? = 6 7 p22 SS 4 6 @ 5 3 8 @ 4 9 5 2 «es 9 2 “a 6 we 6 0 o K A § ee ’ a 2 c po 4 w a i i ) 3 7 1 ° 1 7 7 ONG aw 5 ; fi o 0 2 a i . : Ts 2 4 = Using formula one:‘ot Relation sing Formal O90" 3426 1 Yiss289.6 306, 1 353.96 = 096 To — ode) x2) 1° Pope eae enna 2a] . 10 «343- (x4) ron t64s (pF) (10% 75-40] 3634 figsa9 x 744 . at 1 Tiss 364 Sea = 086 tion of the following data.v o ose tt Ug CD a a 3 ” ‘ o 8 a » » 0 1 " Les 4) » e % 0 1 mi 512 1 fex2— 64] [513-25] _ 512, Yo 56x 488 oe 1” Yer304 522 y = 0.98 Mustration: 10 } From the following data calculate the correlation between age and habit of newspaper re ina colony [Age 10 | 1020 | 2030 | 30-40 | 40-50 | 50-60 | 60-70 | 70s [ No. ofpersons (oof 35 [| 4 | # | 8 o | 3 | » | w No. of readers zpa7pT el la2),=)]sa{[ sys Let the Age is X series and Y is % of reading hat class intervals are calculated. readers gives the Y series,en Nomber of persons Number of Readers % of Real a0 * 7 1s s " * » didy € 10 s ss oo 3 8 n 3s 45 : 4s «0 a s & = 6 ad ‘a CB veg nae IP EE 4400 5 3861 9 Nx Zdedy - (Edx) x (Edy) ova? — Gads eINEHF - AY] he 8x 4910 - (40) x (15) 1 Fig 4400 — 4) }x (8x 5861 - 15)" 38680 1 F560 46663 38680 183.3216 38680, 1 39593 1 = 098 1"Limitations: 1 tr assumes linear relationship even if it does not exist between two variables. > Method and process of calculation is difficult and time consuming. 3 itis affected by extreme values in the distribution. ‘4, It may be misinterpreted if due care is not taken. probable Error Probable error helps to interpret the value of Pearson's coefficient of correlation \ccurately. Probable error is a valye which if added and deducted from the value of Pear: ‘orelation, gives a range, within which coefficient of correlation of a group of variables sel ‘random from the same sample will fall. For example: In a class of 100 students, a group of ! ‘lected at random and calculated Pearson's correlation y. The probable error of y give imits, within which the coefficient of correlation of any 10 or 15 students selected at randc ‘¢ within these limits with 50% probability. Probable error can be calculated by using the fo! Karl Pearson's coefficient of correlation Number of items.wr 22 ‘Quant, the data should be normal The » % Bry ‘by Tomake probable error useful and effective isto be selected at random from the sample Iilustration: 12 . alte the probable ero andthe ange of Pearsons coefficient of erlang {allowing information me Solution: Probable error of y = Range of probability 9-025 = . 878 Iustration: 13 ‘Catclate the probable eror and the range of Pearsons coefficient of corelaton byw following information iy yo8 Solution: Probable error of y =