Wednesday, February 9, 2011

Lemon tree very pretty and the lemon flower is sweet ....


Folks the answer is lemons - more and more lemons as this graph clearly illustrates.
R2 = 0.97 means that 97% of the variation in the Road Toll is accounted for by the variation in amount of fresh lemons being imported into the USA.

It is, of course, and inverse relationship. Thus the more lemons imported, the fewer road fatalities. 

Now this is no joke - it is a true relationship.
It is a good example that correlation does not mean causation. There is an important moderating variable (not shown). What might that be.

So sad to say importing a lots more lemons is not going to reduce our road toll.

There is another important issue here that brings forth such a large R2 .

The variances for the two variables are vastly difference. And that is a big no-no when examining correlations.

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