Statistics is an important subject which includes a lot of concentration to solve the problems. In Statistics, Correlation represents the relation between two variables. That is, if any change in one variable is initiating change in the other variable also then it is said to be a correlation between the two. Two types of correlation are there - Positive Correlation and Negative Correlation.
Positive Correlation is said to be present when a change in one variable causes a positive change in another variable and it is called Positive Correlation. For example, Between Income and spending there is Positive Correlation. As the income increases purchasing power and spending also increased.
Negative Correlation on the other hand exists when a positive change in one variable causes a negative change in another variable. Best example presented for this is the demand theory in Economics. When price of a product increases demand of that product automatically decreases and when the price of the product decreases then the demand for that product increases.
Results of Correlation range between -1.00 and +1.00 only. If the calculated answer is -1.00 then it is referred to as perfect Negative Correlation and if it is +1.00 then it is a perfect Positive Correlation. Answer 0.00 denotes that there is no correlation exists at all.