# Correlation Notes, Class 11 Economics | SwaVid

Correlation, NCERT Class 11 Economics: notes with key ideas, definitions, common mistakes and 3 quick checks with worked answers.

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Source: https://www.swavid.com/cbse/class-11/economics/chapter/correlation

# Correlation

## Definitions, formats and formulas

## Key ideas

## Common mistakes

## Quick checks

## Keep going

## Questions parents ask

## Class 11 Economics on SwaVid

### Concept of correlation

### Types of correlation

### Scatter diagram

### Karl Pearson's coefficient

### Properties of correlation coefficient

### Spearman's rank correlation

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SwaVid › CBSE › Class 11 › Economics › Correlation

Notes written by SwaVid from the NCERT textbook.

Class 11 Economics, Chapter 6. Key ideas, definitions and common mistakes.

CBSE does not print marks for a single chapter.

Short answer. This chapter explains the concept of correlation and measures the strength and direction of linear relationships between two variables. Students learn to interpret scatter diagrams and calculate correlation using Karl Pearson's coefficient and Spearman's rank correlation.

Source: NCERT Statistics for Economics (Reprint 2026-27) , Chapter 6, Correlation

Correlation studies and measures the direction and intensity of association between two quantitative variables. It does not imply causation, meaning a change in one variable does not necessarily cause a change in the other.

Correlation is positive when variables move together in the same direction, and negative when they move in opposite directions. It is linear if the ratio of change remains constant, and non-linear if the ratio of change varies.

A scatter diagram is a visual plot of paired observations on a graph. A linear upward drift indicates positive correlation, a downward drift indicates negative correlation, and points scattered randomly indicate zero correlation.

Karl Pearson's coefficient (r) quantitatively measures the degree of linear association between two variables. Its value strictly ranges between -1 and +1, where -1 is perfect negative, +1 is perfect positive, and 0 indicates no linear correlation.

The coefficient of correlation r is independent of both the origin and the scale of the variables. It is also a pure number without any unit of measurement.

Spearman's rank correlation coefficient (rₛ) measures the association between two sets of ranks or qualitative attributes. It is useful when variables cannot be measured numerically but can be arranged in order of preference or merit.

Try each question first. Then tap it to see the answer.

Formula: r = ∑xy / √(∑x² × ∑y²)

r = 120 / √(225 × 100) = 120 / √22500

r = 120 / 150 = 0.8

0.8

N = 5, N(N² - 1) = 5(25 - 1) = 5 × 24 = 120

rₛ = 1 - (6 × ∑D²) / [N(N² - 1)] = 1 - (6 × 8) / 120

rₛ = 1 - 48 / 120 = 1 - 0.4 = 0.6

0.6

Correlation coefficient is independent of change of origin.

Subtracting 10 from X and adding 15 to Y does not alter the degree of correlation.

Therefore, r(U, V) = r(X, Y) = 0.75.

0.75

Index Numbers .

Measures of Central Tendency .

Use of Statistical Tools .

The 13 chapters of Class 11 Economics .

CBSE does not give marks to one chapter. It prints marks for units or parts, and the chapter list page shows them all.

No. They are written by SwaVid from the NCERT textbook. The CBSE curriculum is the reference for what is assessed.

Index Numbers.

SwaVid is an AI tutor for Indian students in Classes 6 to 12. It finds the earlier ideas a child missed, then teaches today’s chapter. Start free to see how it works.

- Ch 6 NCERT book
- 80 marks, theory paper
- 3 quick checks
- Assuming correlation implies causation between variables . Remember that correlation shows only that two variables move together. It does not prove that one variable causes the change in the other.
- Calculating values of r that fall outside the range of -1 to +1 . Always check your arithmetic if |r| > 1. Karl Pearson's coefficient of correlation can never be less than -1 or greater than +1.
- Squaring the difference after subtracting from 1 in Spearman's formula . Calculate the fraction (6 × ∑D²) / [N(N² - 1)] completely first, and then subtract that result from 1.

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