CHAPTER 9-1

Introduction to Statistics

INTRODUCTION
WHAT IS STATISTICS?
Definition
Statistics is the science of:
 Collecting data
 Analyzing data
 Presenting data
 Interpreting data, and
 Making decisions based on such analyses.

Data: Any observations that have been

collected ‫ هي أي مالحظات ت جمعها‬: ‫البيانات‬
TYPES OF STATISTICS ‫أنواع اإلحصاءات‬

Definition ‫تعريف‬
Descriptive Statistics consists of methods
for organizing, displaying, and describing
data by using tables, graphs, and summary
measures.

‫ يتكون من طرق لتنظيم وعرض ووصف‬: ‫اإلحصاء الوصفي‬

.‫البيانات باستخدام اجلداول والرسوم البيانية وملخص مقاسات‬
‫‪Case Study 1-1 How Much Did Companies Spend on Ads‬‬
‫?‪in 2011‬‬ ‫دراسة احلالة ‪ 1-1‬كم أنفقت الشركات على اإلعالنات ف عام ‪?2011‬‬
TYPES OF STATISTICS ‫أنواع اإلحصاءات‬

Definition ‫تعريف‬
Inferential Statistics consists of methods
that use sample results to help make
decisions or predictions about a population.
‫ تتألف من طرق تستخدم نتائج العينات للمساعدة ف‬: ‫اإلحصائيات االستنتاجية‬
.‫اتخاذ القرارات أو التنبؤات بشأن السكان‬
TYPES OF STATISTICS
Example of inferential statistics from quality control

GE manufactures LED bulbs and wants to know how

many are defective. Suppose one million bulbs a year
are produced in its new plant in Staten Island. The
company might sample, say, 500 bulbs to estimate
the proportion of defectives.
 N = 1,000,000 (population) and n = 500 (sample)
 If 5 out of 500 bulbs tested are defective, the
sample proportion of defectives will be 1% (5/500).
This statistic may be used to estimate the true
proportion of defective bulbs (the population
proportion).
 In this case, the sample proportion is used to make
inferences about the population proportion.
POPULATION VERSUS SAMPLE
Definition
A population consists of all elements –
individuals, items, or objects – whose
characteristics are being studied.
The population that is being studied is also
called the target population.

A portion of the population selected for

study is referred to as a sample.
Figure 1.1 Population and Sample
POPULATION VERSUS SAMPLE
Definition
A survey that includes every member of the
population is called a census. The
technique of collecting information from a
portion of the population is called a sample
survey.
POPULATION VERSUS SAMPLE
Definition
A sample that represents the characteristics
of the population as closely as possible is
called a representative sample.
POPULATION VERSUS SAMPLE
Definition
A sample drawn in such a way that each
element of the population has a chance of
being selected is called a random sample.
If all samples of the same size selected
from a population have the same chance of
being selected, we call it simple random
sampling. Such a sample is called a
simple random sample.
POPULATION VERSUS SAMPLE
A sample may be selected with or without
replacement.

In sampling with replacement, each time

we select an element from the population,
we put it back in the population before we
select the next element.

Sampling without replacement occurs

when the selected element is not replaced
in the population.
BASIC TERMS
Definition
An element or member of a sample or
population is a specific subject or object
(for example, a person, firm, item, state, or
country) about which the information is
collected.
BASIC TERMS
Definition
A variable is a characteristic under study
that assumes different values for different
elements.
In contrast to a variable, the value of a
constant is fixed.
BASIC TERMS
Definition
The value of a variable for an element is
called an observation or measurement.

A data set is a collection of observations on

one or more variables.
Table 1.1 Total Revenues for 2010 of Six Companies
TYPES OF VARIABLES
 Quantitative Variables
 Discrete Variables
 Continuous Variables

 Qualitative or Categorical Variables

Quantitative Variables
Definition
A variable that can be measured
numerically is called a quantitative
variable.
The data collected on a quantitative
variable are called quantitative data.
Quantitative Variables: Discrete
Definition
A variable whose values are countable is
called a discrete variable. In other words,
a discrete variable can assume only certain
values with no intermediate values.
Quantitative Variables: Continuous
Definition
A variable that can assume any numerical
value over a certain interval or intervals is
called a continuous variable.
Qualitative or Categorical Variables
Definition
A variable that cannot assume a numerical
value but can be classified into two or more
non-numeric categories is called a
qualitative or categorical variable.
The data collected on such a variable are
called qualitative data.
Figure 1.2 Types of Variables
CROSS-SECTION VS. TIME-SERIES DATA
 Cross-Section Data
 Time-Series Data
Cross-Section Data
Definition
Data collected on different elements at the
same point in time or for the same period
of time are called cross-section data.
Table 1.2 Total Revenues for 2010 of Six
Companies
Time-Series Data
Definition
Data collected on the same element for the
same variable at different points in time
or for different periods of time are
called time-series data.
Table 1.3 Money Recovered from Health Care
Fraud Judgments
SOURCES OF DATA
 Data may be obtained from
 Internal Sources
 External Sources
 Surveys and Experiments
SUMMATION NOTATION
Suppose a sample consists of five books, and the
prices of these five books are
$175, $80, $165, $97, and $88

The variable price of a book: X

Price of the first book = x1 = $175

Price of the second book = x2 = $80
Price of the third book = x3 = $165
Price of the fourth book = x4 = $97
Price of the fifth book = x5 = $88
SUMMATION NOTATION
Adding the prices of all five books gives

x1 + x2 + x3 + x4 + x5 = 175+80+165+97+88 = 605

Σx = x1+ x2 + x3 + x4 + x5 = 605
Example 1-1
Annual salaries (in thousands of dollars) of four
workers are 75, 90, 125, and 61, respectively.
Find
(a) ∑x (b) (∑x)² (c) ∑x²
 Example 1-1: Solution
(a) ∑x = x1 + x2 + x3 + x4
= 75 + 90 + 125 + 61
= 351 = $351,000

(b) Note that (∑x)² is the square of the sum of all x

values.
Thus,
(∑x)² = (351)² = 123,201
Example 1-1: Solution
(c) The expression ∑x² is the sum of the squares of
x values.
To calculate ∑x² , we first square each of the x
values and
then sum these squared values. Thus,

∑x² = (75)² + (90)² + (125)² + (61)²

= 5,625 + 8,100 + 15,625 + 3,721
= 33,071
 Example 1-2
The following table lists four pairs of m and f
values:

Compute the following:

(a) Σm (b) Σf² (c) Σmf (d) Σm²f
 Example 1-2: Solution
We can write
m1 = 12 m2 = 15 m3 = 20 m4 = 30
f1 = 5 f2 = 9 f3 = 10 f4 = 16

(a) (b) (c) (d)