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In this section, we will use R to make statistical inferences about the relationship between continuous variables. Recall that a continuous variable can take an infinite number of possible values within an interval such as economic growth or height. We will learn to compute and understand covariance and correlation between two continuous variables, which sets the stage for regression analysis in the next section. In this section, we will focus on the following substantive question: Are trade openness and economic growth correlated?

Our objectives in this section are as follows:

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