BASIC CONCEPTS IN

STATISTICS

STATISTICS
Statistics is a mathematical process of collecting, organizing,
presenting, analyzing and interpreting large data.
Uses:
- provides information
- provides comparison
- helps recognize relationships
- estimates unknown quantities
- predicts future outcomes

SOME APPLICATIONS OF STATISTICS

Education evaluate students
performance
Psychology interpret results of
personality tests
Sports summary of events in a
game
Health Sciences evaluation of
medical practices and
effectiveness of drugs

Business
Accounting audit (sampling)
Finance analysis (data gathering)
Marketing compilation (data
history)
Production quality control (testing)
Economics forecasting (data
indicators)

branches of statistics
DESCRIPTIVE
describe the
properties &
characteristics of a
group of persons
places or things
summarize or present
facts of the data we
already have

INFERENTIAL
compare groups
test hypothesis
draw conclusion
make predictions or
inferences about the
population based on
sample results

DATA AND VARIABLE

Data are facts and figures collected, analyzed and summarized for
presentation and interpretation
Data Set are all data collected in a particular study
Elements are entities on which data are collected
Variable characteristic of interest for the elements
Observation is set of measurements obtained for a particular element

Example: Table 1 - S&P Companies

Variables

Exchange

Ticker
Symbol

HAS

eBay

NQ

IBM
Bristol
Myers
Squibb

Company
Hasbro

Elements

Business
Week
Rank

Share
Price

EPS

373

21

0.96

EBAY

19

43

0.57

IBM

216

93

4.94

BMY

346

26

1.21

OTHER KINDS OF DATA

Cross Sectional Data are data collected at the same (or approximately)
point in time.
Help analysts/researchers to see and understand how things work.

Time Series Data are data collected over several time periods.
Help analysts understand what happened in the past, identify trends and project
future levels.

Primary Data data collected by the investigator conducting the

research. Original information for field research.
Secondary Data data collected by another person or different source
for re-use in the purpose of research.

Quantitative/
Numerical

Qualitative/
Categorical
Non-numerical attributes
Gender, religion

Numerical attributes

Discrete
Countable or finite
number of siblings

Continuous
Measurable,
infinite
age, weight

SCALES OF MEASUREMENT
Nominal scale classifies data into various
distinct categories in which NO
ranking/order is implied.
Ex: Course section, religion

Ordinal scale classifies data into distinct

categories in which ranking is implied.
Ex: College levels, satisfaction ratings
Qualitative variable are measured on a nominal scale or an ordinal scale

SCALES OF MEASUREMENT
Interval scale is an ordered scale in which the difference
between measurements is a meaningful quantity, but
does not have true zero.
Ex: Temperature in Fahrenheit and Celsius

Ratio scale is like interval scale with true zero.

Ex: Speed or acceleration of vehicle
Quantitative variable are measured on a ratio scale or an interval scale

POPULATION & SAMPLE

Population is all members of a
collection we are interested in.

Sample is a small portion or

part of a population.

Census is a survey conducted

on the entire population to
collect data

Sample Survey is a survey

conducted to collect data
from the sample.

Parameter is a numerical value

which describes a population.

Statistic is a numerical value

which describes a sample.

SAMPLING
Sampling is the process of selecting units (e.g. persons, organizations,
items) from a population of interest.
Probability Sampling. A process of selecting a sample in such a way
that all individual in the defined population have an equal and
independent chance of being selected through randomization.
Non-Probability Sampling. The samples or subjects that are needed
are merely taken or selected for the purpose of the study.

PROBABILITY SAMPLING
Simple Random Sampling basic method of sampling from a
population randomly
Systematic Random Sampling method in which we randomly select
every kth element of ordered population.
Stratified Sampling method in which the population is first divided
into strata and a simple random sample is then taken from each
stratum.
Cluster Sampling method in which the population is first divided
into clusters and then a simple random sample of the clusters is
taken.

NON-PROBABILITY SAMPLING
Convenience Sampling (Accidental) members are chosen based on
relative ease of access. Like friends, classmates, family, etc.
Judgmental Sampling the researcher choose the sample appropriate
for study.
Snowball Sampling first respondent refers a friend then refers
another and so on.

END OF LECTURE