Correlation and RegressionMCQPYQ Dec 23Question 3647 of 188
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______ may be defined as the ratio of covariance between the two variables to the product of the standard deviation of the two variables

Options

AScatter diagram
BKarl Pearson's correlation coefficient
CSpearman's correlation coefficient
DCoefficient of concurrent deviations
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Correct Answer

Option bKarl Pearson's correlation coefficient

All Options:

  • AScatter diagram
  • BKarl Pearson's correlation coefficient
  • CSpearman's correlation coefficient
  • DCoefficient of concurrent deviations

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Detailed Solution & Explanation

**Definition-based question:** The measure that is defined as the **ratio of covariance between two variables to the product of their standard deviations** is: rXY=fractextCov(X,Y)sigmaXcdotsigmaYr_{XY} = \\frac{\\text{Cov}(X, Y)}{\\sigma_X \\cdot \\sigma_Y} This is **Karl Pearson's Correlation Coefficient** (also called Pearson's product-moment correlation coefficient). **Other measures:** - Scatter diagram: A graphical tool, not a formula - Spearman's: Based on ranks and rank differences, formula rs=1frac6sumd2n(n21)\displaystyle r_s = 1 - \\frac{6\\sum d^2}{n(n^2-1)} - Coefficient of concurrent deviations: Based on signs of changes, formula involves count of concurrent deviations Hence, **Option B** is the correct answer.

About This Chapter: Correlation and Regression

Paper

Paper 3: Quantitative Aptitude

Weightage

4-6 Marks

Key Topics

Correlation Coefficient, Regression Equations

This chapter covers Correlation Coefficient, Regression Equations and is part of Paper 3: Quantitative Aptitude in the CA Foundation exam.

View Official ICAI Syllabus

Exam Strategy Tip

This topic carries 4-6 Marks weightage. Focus on understanding core concepts rather than memorizing.

Key Concepts to Understand

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