Question

Fiscal Year	IT Budget (in $)	Use of EHR	Organization’s Revenue (in $)
2009	200,000	20,000	130,000,000
2010	230,000	22,000	133,000,000
2011	275,000	23,000	137,000,000
2012	300,000	27,000	139,000,000
2013	320,000	30,000	140,000,000

Using the data from the previous question, calculate correlation between Organization’s Revenue, Use of EHR and IT Budget?

Calculate partial correlation and answer the question:

Is it reasonable to assume that IT is adding to the revenues generated by the organization or vice versa, that increased revenue is fueling increased expenditures on IT (what comes first budget or revenue)?

Answer 1

Fiscal Year IT Budget (in $) Fiscal Year IT Budget (in S) Use of EHR Organization's Revenue (in $) Use of EHR 0.979 0.945 Organization's Revenue (in $) 0.977 0.996 0.918 0.99 0.99 0.979 0.977 0.945 0.996 0.918

Here, u can see the correlation between all attributes

and it is reasonable to assume that "IT is adding to the revenues generated by the organization or vice versa, that increased revenue is fueling increased expenditures on IT"

Because "IT Budget is highly correlated with Organization's Revenue and vice versa "

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