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Question 5 of 45

What is the difference between correlation and causation, with a real example?

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Correlation says two variables move together. Causation says changing one actually changes the other. Correlation is symmetric and cheap to compute, while causation is directional and needs either a mechanism or an intervention behind it.

Ice cream sales and drowning deaths rise together every summer. Nobody drowns because a stranger bought a cone. Hot weather drives both, so temperature is a confounder sitting behind the correlation.

A product version bites harder. Customers who use a company's mobile app spend more than web-only customers, so a team concludes the app drives spending. More likely the heaviest customers install the app first. Reverse causation and self-selection are both live explanations. The clean way to settle it is to randomize who gets nudged to install, then compare spend between the two randomized groups.

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