Answered: Define Sample Covariance with suitable…

Name: Define Sample Covariance with suitable example?
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Description: Define Sample Covariance with suitable example?

College Algebra (MindTap Course List)

12th Edition

ISBN:9781305652231

Author:R. David Gustafson, Jeff Hughes

Publisher:R. David Gustafson, Jeff Hughes

Chapter8: Sequences, Series, And Probability

Section8.7: Probability

Problem 58E: What is meant by the sample space of an experiment?

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Define Sample Covariance with suitable example?

Definition Definition Measure of how two random variables change together. Covariance indicates the joint variability or the directional relationship between two variables. When two variables change in the same direction (i.e., if they either increase or decrease together), they have a positive covariance. When the change is in opposite directions (i.e., if one increases and the other decreases), the two variables have a a negative covariance.

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Step 1

Sample Covariance (σ_xy) – Covariance is the measure of linear relationship between variables x and y. It is zero if the relationship is not linear that means x and y are independent variables.

A larger covariance means stronger relationship between the two variables.

If the value of covariance is positive then the relationship between variables are positively related.

If it is negative then the relationship between variables are negatively related.

Formula for covariance is-

Here,

x = is random variable

n = No. of items in the data set

E(x) is the expected value of variable x

E(y) is the expected value of variable y

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