nd the price of coffee as explanatory variables. However, for some reasons, you model the regression by using the price of coffee only. In that case your estimated regression m
Correlation
Correlation defines a relationship between two independent variables. It tells the degree to which variables move in relation to each other. When two sets of data are related to each other, there is a correlation between them.
Linear Correlation
A correlation is used to determine the relationships between numerical and categorical variables. In other words, it is an indicator of how things are connected to one another. The correlation analysis is the study of how variables are related.
Regression Analysis
Regression analysis is a statistical method in which it estimates the relationship between a dependent variable and one or more independent variable. In simple terms dependent variable is called as outcome variable and independent variable is called as predictors. Regression analysis is one of the methods to find the trends in data. The independent variable used in Regression analysis is named Predictor variable. It offers data of an associated dependent variable regarding a particular outcome.
Indicate whether the following statement is true, false or uncertain by providing
necessary proofs and/or explanation
Suppose your instructor told you to construct a model for demand for coffee by
using income and the price of coffee as explanatory variables. However, for some
reasons, you model the regression by using the price of coffee only. In that case
your estimated regression may suggest that price of coffee has a positive effect on
demand for coffee. (A proof is expected)
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