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Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA MA – FIA FMA › Forecasting
The following four data pairs have been obtained: (1,5), (2,6), (4,9),(5,11).Without carrying out calculations, which of the following correlation coefficients best describes the relationship between x and y ?
A.-0.98 B.-0.25 C.0.98 D.0.25
why the answer is c?
Firstly, both sets of observations are increasing together. So the correlation is positive and therefore the answer has to be C or D.
Secondly, just looking at the numbers they do seem to ‘fit together’ reasonably well, which means that the correlation will be closer to 1 than to 0.
So the answer is C.
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