What does a negative correlation coefficient indicate?

A negative correlation coefficient indicates an inverse relationship between two variables, meaning that as one variable increases, the other decreases, and vice versa. This relationship can be quantified by the correlation coefficient, which ranges from -1 to 1. A coefficient close to -1 signifies a strong inverse relationship, while a coefficient closer to 0 suggests a weaker inverse relationship. Understanding this concept is vital because it helps in analyzing how two variables interact with each other in various fields such as statistics, psychology, and economics, among others. The clarity in this relationship allows for better predictions and understanding of underlying trends in data.