Correlation between seller rating and closing price

Now you will explore the correlation between the seller's rating and the auction closing price. Common sense would lead you to believe that the higher ratings a seller has, the higher the closing price. If this were the case you would see a "positive" correlation, both acting similarly.

Remember that "correlation is not causation"! You may suspect that higher ratings improves trust thereby causing prices to edge higher. However, other factors could really be the cause. Perhaps sellers with higher ratings are allowed to sell more expensive products. In which case the real cause is the expensive products, not trust. Thus be careful when exploring correlation & drawing conclusions.

This exercise is part of the course

Introduction to Statistics in Google Sheets

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Exercise instructions

  • In D2, calculate the correlation between "Seller Rating" and "Close Price".
  • Insert a scatter (XY) plot at F1, with "Seller Rating" on the x-axis.

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