REASEARCH METHODOLOGY

MULTIPLE CORRELATION AND REGRESSION WITH EXAMPLES

PRESENTED TO: PROF.SHILPA SHINDE

GROUP MEMBERS
NAME DEVDAS BODA
RUCHI JAIN ASHWINI MHATRE SUPRIYA PAWAR KIRTI PAWASKAR SHRUTI SHINDE

ROLL NO 67
78 89 100 101 112

CORRELATION
Correlation: how strong is the relationship between variables? (are the variables related?) The correlation is a way to measure how associated or relate two variables are. The researcher looks at things that already exist and determine if and in what way those things are related to each other. purpose of doing correlations is to allow us to make a prediction about one variable based on what we know about another variable.

Example Of Correlation
There is a correlation between income and education. We find that people with higher income have more years of education. (You can also phrase it that people with more years of education have higher income.) When we know there is a correlation between two variables, we can make a prediction. If we know a groups income, we can predict their years of education.

REGRESSION
Regression: what is the precise form of the relationship between variables (prediction of one variable based on another) The statistical tool with the help of which we are in position to estimate the unknown values of one variable from known values of another variable. Regression analysis is used to study the nature of relationship between the variables.

EXAMPLE OF REGRESSION
If we know that amount of tax and rise in the price of commodity are closely related we can find out the expected price for a certain amount of tax.

MULTIPLE CORRELATION
Study of relationship between three or more variables. Multiple correlation measures the combined influence of two or more independent variables on single dependent variable.
The variable whose value we are trying to estimate is dependent variable. The other variables on which our estimates are based on are known as independent variable.

MULTIPLE CORRELATION EXAMPLE

Combined influence of amount of fertilizers and rainfall on yield of wheat. Independent variables: amount of fertilizers amount of rain fall dependent variable: yield of wheat.

COEFFICIENT OF MULTIPLE CORRELATION

Coefficient of multiple correlation is represented by R. Value of R is ranging from 0 to +1

R value 0 1 no linear relationship perfect linear relationship

ADVANTAGES AND OF MULTIPLE CORRELATION

Advantages of multiple correlation: 1. It serves as a measure of the degree of association between one variable taken as the dependent variable and a group of other variables taken as the independent variables. 2. It also serves as a measure of goodness of fit of the calculated plane of regression and consequently as a measure of the general degree of accuracy of estimates made by reference to equation for the plane of regression.

DISADVANTAGES OF MULTIPLE CORRELATION

1. 2. 3. Multiple correlation analysis is based on the assumption that the relationship between the variables is liner. the assumption that effects of independent variables on the dependent variables. Linear multiple correlation involves a great deal of work relative to the results frequently obtained.

MULTIPLE REGRESSION
Study of three or more variables. one variable as dependent variable and others are independent variables. It is used to estimate most probable value of dependent variable for given values of independent variables.

Multiple Regression Analysis

Multiple Regression: Y=a+b1X1+b2X2+B3X3+...+BtXt+u
Where:Y=the variable that we are trying to predict(DV) X=the variable that we are using to predict Y(IV) a=the intercept b=the slope(Coefficientof X1) u=the regression residual(error term)

MULTIPLE REGRESSION EXAMPLE

predicting performance on a job (Y) using information on years of experience (X1), performance in a training program (X2), and performance on an aptitude test (X3).

Assumptions in Multiple Regression Analysis

Linearity of the phenomenon measured. Constan tvariance of the error terms. Independence of the error terms. Normality of the error term distribution.

Advantages of multiple regression:

1. The estimates of the unknown parameters obtained from linear least squares regression are the optimal. 2. Estimates from a broad class of possible parameter estimates under the usual assumptions are used for process modeling. 3. It uses data very eciently. Good results can be obtained with relatively small data sets. 4. The theory associated with linear regression is wellunderstood and allows for construction of dierent types of easily-interpretable statistical intervals for predictions, calibrations, and optimizations.

Disadvantages of multiple regression:

1. Outputs of regression can lie outside of the range [0,1]. 2. It has limitations in the shapes that linear models can assume over long ranges. 3. The extrapolation properties will be possibly poor. 4. It is very sensitive to outliers. 5. It often gives optimal estimates of the unknown parameters.

MULTIPLE CORRELATION AND REGRESSION

The following are the three main objectives of multiple regression and correlation analysis. 1. To derive an equation which provides estimates of the dependent variable from values of the two or more independent variables? 2. To obtain a measure of the error involved in using this regression equation as a basis for estimation. 3. To obtain a measure of the proportion of variance in the dependent variables accounted for or explained by the independent variables. The first purpose is accomplished by deriving an appropriate regression equation by the method of least squares. The second purpose is achieved through the calculation of a standard error of estimate. The third purpose is accomplished by computing the multiple coefficient of determination.

MULTIPLE CORRELATION AND REGRESSION

Key idea: multiple corr./regression uses more than one independent variable to better account for complex, real-world Situations. For example: individual income level depends at least in part on (to name a few variables) Education Location Age Social connections

MULTIPLE CORRELATION AND REGRESSION

Another example: evaporation depends on Temperature Pressure Wind Sunshine Humidity