Professional Documents
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19
24
21
26
22
15
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19
31
36
48
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39
The management is considering whether it should terminate the services of the salesman who did
not do well in the test. To check, whether the termination of services of those salesman who had
not done well is test or secured lowest score and be found out by calculating correlation between
the test scores and sales made by them.
However, if the management want to fix a minimum sales volume of certain amount , Lets say
Rs 30,000 from each sales man, what could be the minimum test scores secured by sales man
which will be indicating termination of thier services? For this, line of regression is used to find
out minimum test score.
Let X denotes the test scores of the salesmen and Y denote their corresponding sales (in Rs1000).
Calculation for Correlation & Regression
X
x=X-x=X-20
y=Y=y= Y-40
x2
y2
xy
14
31
-6
-9
36
81
54
19
36
-1
-4
16
24
48
16
64
32
21
37
-3
-3
26
50
10
36
100
60
22
45
25
10
15
33
-5
-7
25
49
35
20
41
19
39
-1
x= 0
y= 0
X= 180 Y= 360
xx = X / N = 180 / 9 = 20
byx = Coefficient of regression of Y on X
= xy / x 2 = 193 / 120 = 1.6083
= Y / N = 360 / 9 = 40
bxy = Coefficient of regression of X on Y
= xy / y 2 = 193 = 346 = 0.5578
Karl Pearsons correlation coefficient r between x and y is given by:
To estimate the sales volume (Y) of a salesman with given test scores (x), we use the line of
regression of Y on X, which is given by:
Y = byx (X - xx)
Y 40 = 1.6083 (X 20) = 1.6083X 32. 1660
Y 40 = 1.6083X 32.1660 + 40
Y = 1.6083X 32.1660 + 40
Y = 1.6083X + 7.8340
Y = 1.6083 x 14.422 + 7.8340 = 23. 195 + 7.8340
Y = 31.029 = 31