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Inside Collection (Textbook): Principles of Business Statistics
Summary: This module provides an overview of Linear Regression and Correlation: Scatter Plots as a part of Collaborative Statistics collection (col10522) by Barbara Illowsky and Susan Dean.
Before we take up the discussion of linear regression and correlation, we need to examine a
way to display the relation between two variables
From an article in the Wall Street Journal: In Europe and Asia,
m-commerce is popular. M-commerce users have special mobile
phones that work like electronic wallets as well as provide phone and Internet services.
Users can do everything from paying for parking to buying a TV set or soda from a
machine to banking to checking sports scores on the Internet. For the years 2000 through 2004, was
there a relationship between the year and the number of m-commerce users?
Construct a scatter plot. Let
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A scatter plot shows the direction and strength of a relationship between the variables. A clear direction happens when there is either:
You can determine the strength of the relationship by looking at the scatter plot and seeing how close the points are to a line, a power function, an exponential function, or to some other type of function.
When you look at a scatterplot, you want to notice the overall pattern and any deviations from the pattern. The following scatterplot examples illustrate these concepts.
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In this chapter, we are interested in scatter plots that show a linear pattern. Linear patterns
are quite common. The linear relationship is strong if the points are close to a straight line.
If we think that the points show a linear relationship, we would like to draw a line on the
scatter plot. This line can be calculated through a process called linear regression.
However, we only calculate a regression line if one of the variables helps to explain or
predict the other variable. If
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This work is licensed by Maxfield Foundation under a Creative Commons Attribution License (CC-BY 3.0), and is an Open Educational Resource.
Last edited by Susan Dean on Jun 27, 2012 2:29 pm -0500.
"Reviewer's Comments: 'I recommend this book. Overall, the chapters are very readable and the material presented is consistent and appropriate for the course. A wide range of exercises introduces […]"