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Correlation Measurements with Microsoft Excel by Stephen Nelson

(Contd. from page 2...)

Using the PEARSON function on the data shown in Figure 4-6 to compute the correlation coefficient returns the same value as the CORREL function does.

RSQ

The RSQ function calculates the square of the Pearson product moment correlation coefficient through data points in the data sets. You can interpret the r-squared value as the proportion of the variance in y attributable to the variance in x. The RSQ function uses the following syntax: =RSQ(data set 1,data set 2)

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About Stephen Nelson
Seattle CPA Stephen L. Nelson wrote the bestselling book, MBA's Guide to Microsoft Excel, from which this short article is adapted. Nelson also writes and edits downloadable do-it-yourself incorporation kits that businesses and investors can use for setting up an Nebraska incorporation or an Nevada incorporation.
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