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Exercise

Nonlinear relationship

Covariance and correlation measure the strength of a linear relationship.

If these metrics are low, it doesn't mean that the variables are not related at all!

In some cases, you can achieve linearity using a transformation of one or more of the variables. If your data is heavily skewed, a log-transformation usually helps.

In your environment, you can find the houses data frame with two variables: area and price.

Instructions 1/2

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  • Draw a scatter plot of price explained by area from the houses data frame; are the variables related?
  • Compute the correlation coefficient between price and area; what does the result tell about the relationship between variables?