Let θ be the angle made by the line of regression of Y on X. If σ Y= 2σ X and the correlation coefficient between X and Y is 0.3, the value θ equals
tan-1 0.6
The question asks for the angle made by the line of regression of Y on X with the positive x-axis. This angle, denoted by $\theta$, is related to the slope of the regression line. The line of regression of Y on X is used to predict the value of Y based on a given value of X.
The general form of the regression line of Y on X is given by:
$$Y - \bar{Y} = b_{YX}(X - \bar{X})$$
where:
The angle $\theta$ that this line makes with the positive direction of the X-axis is such that its tangent is equal to the slope of the line. Therefore:
$$\tan \theta = b_{YX}$$
The regression coefficient of Y on X, $b_{YX}$, can be calculated using the correlation coefficient between X and Y ($r$), the standard deviation of Y ($\sigma_Y$), and the standard deviation of X ($\sigma_X$). The formula is:
$$b_{YX} = r \frac{\sigma_Y}{\sigma_X}$$
We are given the following information:
Now, let's substitute these values into the formula for $b_{YX}$:
$$b_{YX} = r \frac{\sigma_Y}{\sigma_X} = (0.3) \frac{2\sigma_X}{\sigma_X}$$
We can cancel out $\sigma_X$ from the numerator and the denominator (assuming $\sigma_X \neq 0$, which is typically the case for meaningful regression):
$$b_{YX} = 0.3 \times 2$$
$$b_{YX} = 0.6$$
We know that $\tan \theta = b_{YX}$. Substituting the calculated value of $b_{YX}$:
$$\tan \theta = 0.6$$
To find the angle $\theta$, we take the inverse tangent (arctan) of 0.6:
$$\theta = \tan^{-1}(0.6)$$
This is the angle made by the regression line of Y on X with the positive x-axis.
Let's compare our result with the given options:
Our calculated value, $\theta = \tan^{-1}(0.6)$, matches option 3.
Based on the given standard deviations and correlation coefficient, the regression coefficient of Y on X is 0.6. The angle made by the regression line of Y on X with the x-axis is the angle whose tangent is this coefficient. Therefore, the value of $\theta$ is $\tan^{-1}(0.6)$.
| Quantity | Symbol | Value/Relation Given |
|---|---|---|
| Correlation Coefficient | $r$ | 0.3 |
| Standard Deviation of Y | $\sigma_Y$ | $2\sigma_X$ |
| Standard Deviation of X | $\sigma_X$ | $\sigma_X$ |
| Regression Coefficient (Y on X) | $b_{YX}$ | $r (\sigma_Y / \sigma_X)$ |
| Angle with X-axis | $\theta$ | $\tan^{-1}(b_{YX})$ |
| Concept | Formula | Meaning |
|---|---|---|
| Regression Line of Y on X | $Y - \bar{Y} = b_{YX}(X - \bar{X})$ | Equation predicting Y from X |
| Slope of Y on X Line | $b_{YX}$ | Change in Y for a unit change in X |
| Formula for $b_{YX}$ | $r \frac{\sigma_Y}{\sigma_X}$ | Relates correlation and standard deviations to the slope |
| Angle with X-axis | $\tan \theta = b_{YX}$ | Geometrical interpretation of the slope |
| Regression Line of X on Y | $X - \bar{X} = b_{XY}(Y - \bar{Y})$ | Equation predicting X from Y |
| Slope of X on Y Line | $b_{XY}$ | Change in X for a unit change in Y |
| Formula for $b_{XY}$ | $r \frac{\sigma_X}{\sigma_Y}$ | Relates correlation and standard deviations to the slope |
Correlation Coefficient (r): This value measures the strength and direction of a linear relationship between two variables, X and Y. It ranges from -1 to +1. A value of 0.3 indicates a weak positive linear relationship.
Regression Coefficients ($b_{YX}$ and $b_{XY}$): These are measures of the average functional relationship between variables. $b_{YX}$ tells us how much Y changes for a unit change in X, and $b_{XY}$ tells us how much X changes for a unit change in Y. They are generally not equal unless $\sigma_X = \sigma_Y$.
Relationship between Regression Coefficients and Correlation: The correlation coefficient $r$ is the geometric mean of the two regression coefficients, provided they have the same sign:
$$r^2 = b_{YX} \times b_{XY}$$
The sign of $r$, $b_{YX}$, and $b_{XY}$ is always the same, indicating the direction of the linear relationship (positive or negative).
Angle between Regression Lines: The two regression lines (Y on X and X on Y) intersect at the point $(\bar{X}, \bar{Y})$. The angle between these two lines is given by:
$$\tan \phi = \frac{1 - r^2}{r} \frac{\sigma_X \sigma_Y}{\sigma_X^2 + \sigma_Y^2} \quad \text{or} \quad \tan \phi = \frac{b_{XY} - b_{YX}}{1 + b_{YX} b_{XY}}$$
If the correlation is perfect ($|r|=1$), the two regression lines coincide, and the angle between them is 0. If the variables are uncorrelated ($r=0$), the regression lines are perpendicular, and the angle between them is 90 degrees ($\tan \phi$ would be undefined). In this question, $r=0.3$, which is between 0 and 1, so the lines will not be perpendicular or coincident.
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The value of simple correlation coefficient lies in the interval:
Which option is correct for the correlation ratio E 2?
The multiple correlation coefficient R 1,23 as compared to any simple correlation coefficients between the distinct variable X 1 ,X 2, and X 3is
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Assertion (A): If the securities with less than perfect negative correlation between their price movements are combined, portfolio risk can be reduced significantly.
Reason (R): The term with negative correlation has the effect of reducing the computed value of total portfolio risk, given other terms that are positive.
In the light of the above statements, choose the most appropriate answer from the options given below:
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If X ∼ N (0, 1) and Y = X2 then the correlation coefficient r (X, Y) is
Calculate the correlation coefficient between the following values :
x: 3, 5, 1, 7, 5
y: 4, 3, 0, 8, 2
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