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MR Statistics 1

The document provides an overview of business statistics, detailing types such as descriptive and inferential statistics, along with basic vocabulary including population, sample, parameter, and statistic. It emphasizes the importance of data collection for various stakeholders and outlines sources of data, types of variables, and scales of measurement. The content serves as a foundational guide for understanding statistical concepts and their applications in decision-making.

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8 views21 pages

MR Statistics 1

The document provides an overview of business statistics, detailing types such as descriptive and inferential statistics, along with basic vocabulary including population, sample, parameter, and statistic. It emphasizes the importance of data collection for various stakeholders and outlines sources of data, types of variables, and scales of measurement. The content serves as a foundational guide for understanding statistical concepts and their applications in decision-making.

Uploaded by

valechany9113
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Business Statistics

Introduction
Dr M K BARUA
DEPARTMENT OF MANAGEMENT STUDIES

1
Types of Statistics
• Statistics
• The branch of mathematics that transforms data into
useful information for decision makers.

Descriptive Statistics Inferential Statistics

Collecting, summarizing, and Drawing conclusions and/or


describing data making decisions concerning a
population based only on
sample data
Descriptive Statistics
• Collect data
– e.g., Survey

• Present data
– e.g., Tables and graphs

• Characterize data
– e.g., Sample mean = X i

n
Inferential Statistics
• Estimation
– e.g., Estimate the population
mean weight using the sample
mean weight
• Hypothesis testing
– e.g., Test the claim that the
population mean weight is 120
pounds

Drawing conclusions about a large group of individuals based on a subset of the large group.
Basic Vocabulary of Statistics
VARIABLE
A variable is a characteristic of an item or individual.

DATA
Data are the different values associated with a variable.
Basic Vocabulary of Statistics
POPULATION

SAMPLE

PARAMETER

STATISTIC
Basic Vocabulary of Statistics
POPULATION
A population consists of all the items or individuals about which you want to draw a conclusion.
Ex: People who live within 25 kms of radius from center of the city.

SAMPLE
A sample is the portion of a population selected for analysis. It has to be representative.

PARAMETER
A parameter is a numerical measure that describes a characteristic of a population.

STATISTIC
A statistic is a numerical measure that describes a characteristic of a sample.
Population vs. Sample
Population Sample

Measures used to describe the Measures computed from


population are called parameters sample data are called statistics
9
Which is better : Samplings or complete enumeration?
Double counting example: Truck association claims that “75 % of the
items you receive at home come from trucks”. Does it mean 25 %
Rail, Airplane, Ship.
Benefits of sample
• Less time
• Less expensive
• Population is large
• Nature of measurement is destructive?
Why Collect Data?
 A marketing research analyst needs to assess the effectiveness of a new television advertisement.

 A pharmaceutical manufacturer needs to determine whether a new drug is more effective than
those currently in use.

 An operations manager wants to monitor a manufacturing process to find out whether the quality
of the product being manufactured is conforming to company standards.

 An auditor wants to review the financial transactions of a company in order to determine whether
the company is in compliance with generally accepted accounting principles.
Why Collect Data?
 Teachers,

 Consultants,

 Industrialists,

 Counselors,

 Administrators,

 Managers,

 Parents, and

 Students, need to seek information in order to perform their jobs.


Sources of Data
 Primary Sources: The data collector is the one using the data for
analysis
 Data from a political survey
 Data collected from an experiment
 Observed data

 Secondary Sources: The person performing data analysis is not


the data collector
 Analyzing census data
 Examining data from print journals or data published on the internet.
Types of Variables
 Categorical (qualitative) variables have values
that can only be placed into categories, such as
“yes” and “no.”

 Numerical (quantitative) variables have values


that represent quantities.
Types of Data
Data

Categorical Numerical
Examples:
 Marital Status
 Political Party
 Eye Color
(Defined categories) Discrete Continuous

Examples: Examples:
 Number of Children  Weight
 Defects per hour  Voltage
(Counted items) (Measured characteristics)
Scales of Measurement
Scales of measurement include:
Nominal Interval

Ordinal Ratio

The scale determines the amount of information contained in the data.

The scale indicates the data summarization and statistical analyses that are most
appropriate.
Scales of Measurement
• Nominal

Data are labels or names used to identify an attribute of the element.

A nonnumeric label or numeric code may be used.


Scales of Measurement
 Nominal

Example:
Students of a university are classified by the school in which they are enrolled
using a nonnumeric label such as Business, Humanities, Education, and so on.
Alternatively, a numeric code could be used for the school variable
(e.g. 1 denotes Business,2 denotes Humanities, 3 denotes Education, and so on).
Scales of Measurement
• Ordinal
The data have the properties of nominal data and
the order or rank of the data is meaningful.

A nonnumeric label or numeric code may be used.

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