Professional Documents
Culture Documents
of
Statistical Studies
1
Introduction
■ Decision makers make better decisions
when they use all available information
in an effective and meaningful way. The
primary role of statistics is to to provide
decision makers with methods for
obtaining and analyzing information to
help make these decisions. Statistics is
used to answer long-range planning
questions, such as when and where to
locate facilities to handle future sales.
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Definition
■ Statistics is defined as the
science of collecting,
organizing, presenting,
analyzing and interpreting
numerical data for the purpose
of assisting in making a more
effective decision.
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Applications in Management
■ Accounting
Public accounting firms use statistical
sampling procedures when conducting
audits for their clients.
■ Economics
Economists use statistical information
in making forecasts about the future of
the economy or some aspect of it.
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Applications in Management
■ Marketing
Electronic point-of-sale scanners at
retail checkout counters are used to
collect data for a variety of marketing
research applications.
■ Production
A variety of statistical quality
control charts are used to monitor
the output of a production process.
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Types of Statistics
■ There are two types of statistics
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Sample
■ A Sample is a part of a
population and the sample size
is denoted by n. A sample
should be a representative of
the population.
■ A descriptive measure of a
population is called a Statistic
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Data and Data Sets
■ Data are the facts and figures collected, summarized,
analyzed, and interpreted.
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Elements, Variables, and Observations
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Data, Data Sets,
Elements, Variables, and Observations
Observation Variables
Element
Names Stock Annual Earn/
Company Exchange Sales($M) Share($)
Data Set
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Scales of Measurement
Scales of measurement include:
Nominal Interval
Ordinal Ratio
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Scales of Measurement
■ Nominal
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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).
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Scales of Measurement
■ Ordinal
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Scales of Measurement
■ Ordinal
Example:
Students of a university are classified by their
class standing using a nonnumeric label such as
Freshman, Junior, or Senior.
Alternatively, a numeric code could be used for
the class standing variable (e.g. 1 denotes
Freshman, 2 denotes Juniors and so on).
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Scales of Measurement
■ Interval
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Scales of Measurement
■ Interval
Example:
Shruti has an MAT score of 605, while Raj
has an MAT score of 655. Raj scored 50
points more than Shruti.
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Scales of Measurement
■ Ratio
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Scales of Measurement
■ Ratio
Example:
Raj’s college record shows 36 credit hours
earned, while Kevin’s record shows 72 credit
hours earned. Kevin has twice as many credit
hours earned as Raj’s.
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Qualitative and Quantitative Data
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Qualitative Data
Labels or names used to identify an attribute of each
element
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Quantitative Data
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Scales of Measurement
Data
Qualitative Quantitative
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Cross-Sectional Data
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Time Series Data
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Data Sources
■ Existing Sources
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Descriptive Statistics
■ Descriptive statistics are the tabular, graphical, and
numerical methods used to summarize and present
data.
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Example: Hudson Auto Repair
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Example: Hudson Auto Repair
91 78 93 57 75 52 99 80 97 62
71 69 72 89 66 75 79 75 72 76
104 74 62 68 97 105 77 65 80 109
85 97 88 68 83 68 71 69 67 74
62 82 98 101 79 105 79 69 62 73
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Tabular Summary:
Frequency and Percent Frequency
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Graphical Summary: Histogram
Tune-up Parts Cost
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16
14
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Frequency
10
8
6
4
2
Parts
50−59 60−69 70−79 80−89 90−99 100-110 Cost ($)
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Numerical Descriptive Statistics
The most common numerical descriptive statistic
is the average (or mean).
Hudson’s average cost of parts, based on the 50
tune-ups studied, is $79 (found by summing the
50 cost values and then dividing by 50).
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Statistical Inference
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Process of Statistical Inference
1. Population
consists of all tune- 2. A sample of 50
ups. Average cost of engine tune-ups
parts is unknown.
unknown is examined.
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Computers and Statistical
Analysis
Statistical analysis typically involves working with
large amounts of data.
Computer software is typically used to conduct the
analysis.
Instructions are provided in chapter appendices for
carrying out many of the statistical procedures
using Minitab and Excel.
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