Industrial Engineering

Basic Concepts of Statistics & Probability

Statistics
Review of Statistical Concepts
Mathematical science pertaining to the collection, analysis, interpretation or explanation, and presentation of data. It produces quantities calculated from a random sample taken from a population of interest

Probability
Descriptive Statistics
Probability is the measure of how likely an event will occur or has occurred. An event is one or more outcomes of an experiment .An outcome is the result of a single trial of an experiment The probability of event A is P(A) ; 0 P(A) 1

Statistics Probability
Numerical and Graphical Examples
Probability represents uncertainty while statistics describe the sample data or imply information from the sample data

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Basic Concepts of Statistics & Probability

Review of Statistical Concepts

Population
The entire set of potential observations (items, people, etc) about whose properties we would like to learn

Descriptive Statistics

Sample
The set of observational units (items, people, etc) whose properties our study is to observe. When we select a sample by scientific randomization, we are more easily able to generalize our conclusions to the population of interest. For a given characteristic, the collection of measurements that are actually observed

Numerical and Graphical Examples

For practical reasons sample is used to represent the population. Data is collected for the sample members in an observational or experimental setting. This data can then be subjected to statistical analysis.
When we measure something in a population it is called a parameter. When we measure something in a sample it is called a statistic
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Basic Concepts of Statistics & Probability

Review of Statistical Concepts

Descriptive Statistics
Summarize the population data by describing what was observed in the sample numerically or graphically. Numerical descriptors include mean and standard deviation for continuous data types , while frequency and percentage are more useful in terms of describing categorical data .

Descriptive Statistics

Inferential Statistics
Uses patterns in the sample data to draw inferences about the population. These inferences may take the form of: answering yes/no questions about the data (hypothesis testing) estimating numerical characteristics of the data (estimation), describing associations within the data (correlation), modeling relationships within the data (regression), extrapolation, interpolation, or other modeling techniques like ANOVA, time series, and data mining.

Numerical and Graphical Examples

Industrial Engineering

Basic Concepts of Statistics & Probability

Review of Statistical Concepts

Location The location is the expected value of the output being measured. For a stable process, this is the value around which the process has stabilized.

Descriptive Statistics

Spread The spread is the expected amount of variation associated with the output. This tells us the range of possible values that we would expect to see.

Shape

Numerical and Graphical Examples

The shape shows how the variation is distributed about the location. This tells us if our variation is symmetric about the mean or if it is skewed.

Industrial Engineering

Basic Concepts of Statistics & Probability

Review of Statistical Concepts

Parameter Location (central tendency) Spread

Numerical Mean Median Mode Standard Deviation variance range skewness kurtosis

Graphical scatter plot boxplot histogram boxplot histogram Box plot histogram probability plot

Descriptive Statistics
Shape

Numerical and Graphical Examples

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Basic Concepts of Statistics & Probability

Describing Variation
Review of Statistical Concepts
Variation in output comes from several sources such as materials, machines, methods, measurements, environment and people
Variation can be measured and described numerically or graphically Variation means the data is distributed

Descriptive Statistics

Numerical Measures of Central Tendency

Knowing where the center of a distribution is tells us a lot about a distribution. Mean, the mean, or average score, is the arithmetic center of the distribution

Numerical and Graphical Examples

Median, The median is the physical center of the distribution. It is the value in the middle when the values of the distribution are arranged sequentially. Mode The mode is the most frequent value in the distribution. It is simply the value that appears most often
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Descriptive Statistics

Numerical Measures of Dispersion

Review of Statistical Concepts
Measures of dispersion or variability will give us information about the spread of the scores in our distribution
Range The range is the difference between the high and low score in a distribution. Simply subtract the two numbers to find the range

Descriptive Statistics

Standard Deviation and Variance - both measure how far on average scores deviate or differ from the mean. The standard deviation is the average deviation about the mean

Numerical and Graphical Examples

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Descriptive Statistics

Graphical Display of Central Tendency

Review of Statistical Concepts

Box Plot
A graphical display that provides important quantitative information about a data set. Some of this information is location or central tendency; Spread or variability; Departure from symmetry; and Identification of outliers

Descriptive Statistics

Histogram
A graphical display of a grouped frequency distribution as a way to abbreviate the values we are dealing with in a distribution.

Numerical and Graphical Examples

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Numerical and Graphical Example

Review of Statistical Concepts

Minitab Example..

Descriptive Statistics

Numerical and Graphical Examples

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