Question

A company is introducing a job evaluation scheme. Points (x) will be awarded to each job based on the qualifications and skills needed and the level of responsibility. Pay (£y) will then be allocated to each job according to the number of points awarded.Before the scheme is introduced, a random sample of 8 employees was taken and the linear regression equation of pay on points was y = 4.5x – 47. (a) Describe the correlation between points and pay.

Answer 1

Let's take for example values for x and find its corresponding value for y.

For x = 5

`y=4.5(5)-47=22.5-47=-24.5`

For x = 19

`y=4.5(19)-47=85.5-47=38.2`

Therefore,

Answer: the correlation between points and pay is positive