Date added: | 12/16/2011 |
Date modified: | 02/15/2012 |
Filesize: | 145.25 kB |
Downloads: | 3730 |
Business Problem: Consider a case where we only have 4 readings with each one taken an hour apart. By using data at each minute we are able to increase our sample size to 240. We are not increasing the number of samples, but the statistical calculation is done as if we have, and so the number of degrees of freedom for the significance test is incorrectly increased and a spurious conclusion is reached. This is one of primary causes of "spurious correlation".