Cluster Analysis

Submitted by: Submitted by

Views: 321

Words: 757

Pages: 4

Category: Business and Industry

Date Submitted: 11/12/2012 01:24 PM

Report This Essay

Phase 4 Individual Project

Homeland Security and Government

Colorado Technical University Online


November 6, 2012

Working for Company W, I realize that I must quickly learn to use statistical analysis so that when my company and WidgeCorp fully merge I will be on the same level as all of my new coworkers. Previously, we worked on forecasting and regression. This week we are staying with forecasting but turning to correlation. Correlation is one statistical method used by the managers in WidgeCorp and other companies for forecasting.

Correlation is a way to determine how two variables are related. There are different types of correlation that are possible. The three types of correlation are positive, negative, and minimal. There are formulas that are used when studying correlations. The closer the formula comes to +1.0 the correlation is positive. The closer it comes to -1.0 then the correlation is negative. If the formula is near 0, then the correlation is minimal. (CTU Online, 2012).

The first type of correlation is a positive correlation. Although I won’t go into formulas, the positive correlation is normally shown as +1.0. This means that the two variables have a positive correlation. If one variable increases than the second variable will also increase. The same is true if one variable is negative then the second will also be negative. The second type of correlation is a negative correlation. This correlation is normally shown as -1.0. In a negative correlation, if the first variable increases then the second variable will decrease. Similarly, if the first variable decreases then the second variable will increase. The third type of correlation is minimal correlation. This is normally shown as 0. When a correlation is minimal, that means that the two variables have no relationship between the two. They are considered independent of each other. When one increases, there is no relationship to...