Does retail value predict the thread count of cotton sheets?

Karyn Lewis
4/15/06
Introduction

The word correlation is used in everyday life to denote some form of association. However, in
statistical terms we use correlation to denote association between two quantitative variables. We also
assume that the association is linear, that one variable increases or decreases a fixed amount for a unit
increase or decrease in the other. The other technique that is often used in these circumstances is
regression, which involves estimating the best straight line to summarize the association.
The purpose of this project was to become familiar with the techniques of correlation and
regression as learned in the Data Analysis course, both manually as well as with the application of
Minitab software. This particular study focuses on the numerical association between the variable thread
count of cotton sheets and its corresponding retail price. I selected 15 bivariate observations from the
bedding retail site, http://bedding-and-bath.smartbargains.com, in order to analyze the data and create a
scatter diagram, determine the equation of the least squares line, the standard error of estimate, the
correlation coefficient, the coefficient of determination, and sample predictions. I studied the data and
developed a conclusion based on the information I found.
In this study, the predictor variable (x) was thread count while the response variable (y) was the
retail price of the sheets, to answer the question ―Does the thread count predict the retail value of cotton
sheets?‖
Table of Data

Row x y xy x2 y2 yp y-yp (y-yp)2

1 200 99.99 19998 40000 9998 71.73 28.26 798.6
2 250 129.99 32498 62500 16897 110.73 19.26 371.0
3 300 132.00 39600 90000 17424 149.73 -17.73 314.4
4 320 162.00 51840 102400 26244 165.33 -3.33 11.1
5 350 179.00 62650 122500 32041 188.73 -9.73 94.7
6 360 179.00 64440 129600 32041 196.53 -17.53 307.3
7 400 180.00 72000 160000 32400 227.73 -47.73 2278.2
8 420 217.00 91140 176400 47089 243.33 -26.33 693.3
9 440 245.00 107800 193600 60025 258.93 -13.93 194.0
10 460 300.00 138000 211600 90000 274.53 25.47 648.7
11 500 380.00 190000 250000 144400 305.73 74.27 5516.0
12 600 400.00 240000 360000 160000 383.73 16.27 264.7
13 800 450.00 360000 640000 202500 539.73 -89.73 8051.5
14 1000 800.00 800000 1000000 640000 695.73 104.27 10872.2
15 1200 810.00 972000 1440000 656100 851.73 -41.73 1741.4
I. Scatterplot

Scatterplot of Thread Count vs. Retail Price of cotton sheets

900

800

700

600
Retail Price ($)

500

400

300

200

100

0
200 400 600 800 1000 1200
Thread Count

II. Regression Analysis

The regression equation is
Retail Price = - 83.9 + 0.779(Thread Count)

Predictor Coef SE Coef T P

Constant -83.86 26.98 -3.11 0.008
x 0.77920 0.04683 16.64 0.000

S = 49.7349 R-Sq = 95.5% R-Sq(adj) = 95.2%

Analysis of Variance

Source DF SS MS F P
Regression 1 684822 684822 276.86 0.000
Residual Error 13 32156 2474
Total 14 716979

III. Correlations (Pearson’s coefficient)

Pearson correlation of Retail Price and Thread Count = 0.977
Conclusion

Because a positive slope is represented by the calculated regression equation, the scatterplot of
the data I found shows a close, positive relationship between the retail price of cotton sheets and the
corresponding thread counts. As the thread count increased, the retail price increased, with all of the
points being within a specific range away from the predicted values also shown by the regression
equation, which represents the mean of the bivariate data I collected. This positive relationship can also
be determined by looking at the calculated correlation between thread count and retail price.
The degree of association is measured by a correlation coefficient. The correlation coefficient is
measured on a scale that varies from + 1 through 0 to – 1, with a complete correlation expressed by either
+ 1 or - 1. When one variable increases as the other increases the correlation is positive. Using Pearson’s
correlation, the degree of linear relationship between two variables is reflected. A correlation of +1 means
that there is a perfect positive linear relationship between variables. The scatterplot I graphed for this
project depicts such a relationship. It is a positive relationship because high scores on the X-axis are
associated with high scores on the Y-axis. Because Pearson’s coefficient, which was 0.98, was close to
+1, there is a positive relationship.
The calculated regression equation (or least squares equation) was used to predict the price of the
sheets. Taking into account all data collected, the retail price could be predicted to equal - 83.9 +
0.78(thread count). The average thread count as well as the average price can be found on that line when
graphed out, with .78 being the slope of the line along the points. In general, therefore, the thread count of
cotton sheets can predict their retail value.
The error in prediction from the plotted points in comparison with the line representing the
regression equation on the scatterplot is summarized by a statistic called the standard error of estimate,
which is interpreted as the standard deviation of prediction errors. The standard error of the estimate is a
measure of the accuracy of predictions made within the regression line, with the line in the plot being the
best fitting straight line.
The coefficient of determination explains much of the variability between the price of sheets and
their thread counts, by how close the points are to the line. The variability in the retail prices can be
measured by the sum of squared deviations from its mean. After fitting the straight line, the remaining
variability about the line can be measured.
The scatterplot of the data I found really contains no surprises. In general, each of the points
follow the linear relationship of the regression equation, and the error of prediction is a low 13.9%. I
found this very direct relationship rather intriguing. This is because in general, the higher the thread
count, the softer the fabric feels, but that doesn't necessarily mean the sheets will last longer (and sheets
with a higher thread count are usually more expensive). Many linens manufacturers have acclaimed
thread count as the best way to choose a sheet. But others point out that the quality of the fibers and finish
are more important to the sheet's comfort and durability. In fact, sheets made of linen, flannel, or jersey
(those trendy "T-shirt" sheets) have low thread counts due to the type of fabric, but they are amazingly
soft and comfortable. A high thread count would eliminate part of the appeal of these sheets. According to
Consumer Reports, cotton and cotton-blend sheets with a thread count of 180 to 200 stand up to wear and
tear and provide satisfactory comfort. People still think of higher thread counts as a luxurious addition to
their abode and a way of pampering or rewarding themselves. After doing this project, however, one
thing’s for sure—the higher the thread count, generally the more expensive the sheet.