This action might not be possible to undo. Are you sure you want to continue?

Course Code: 1206

K = 1 + 3.322log10 π

35

HM = π

GM =

1 π₯ π π₯

1 . π₯2 β¦ π₯π

Prepared by

Md. Mazharul Islam (Jony).

Roll no: 091541, 3rd Batch.

Department of Finance.

Jagannath University.

Frequency Polygon

30

25

20

15

10

5

0

2

7

12

17

22

27 π

=

1|page

32 ππ

+ ππ + ππ + . β¦ . β¦ . . + ππ

=
π
ππ
π

Department of Finance, Jagannath University

JONY

Statistics-I

The word statistics originated from either the Italian word βstatistaβ or the German word

βstatistikβ. Both the word statista and statistik mean political states of a nation. By statistics now we

mean quantitative data affected to a marked extent by multiplicity of causes.

Definition of Statistics:

It is almost impossible to formulate statistics in a compact definition. Different statisticians

have defined statistics from different perspectives. These definitions are to be used in two different

meanings.

In singular perspective: In singular perspective the meaning of statistics is that statistics suggests

those principles, formula and functions through which the calculate subjects are expressed.

In plural perspective: In plural perspective statistics means the expression of the calculated

affairs of our day to day life.

Example: a) The amount of recent per capita (average) expenditure of the official

workers of an industry,

b) The annual birth rate or death rate of Bangladesh etc.

Statistics:

Statistics may be defined as the collection, processing, presentation, analysis and

interpretation of numerical data affected by a multiplicity of causes.

βThe science of statistics is essentially a branch of applied mathematics and may be regarded as

mathematics applied to observational data.β

- R.A. Fisher,

At last we can say that, Statistics is the science which deals with the methods of collecting,

classifying, presenting, comparing and interpreting numerical data collected to through some light

on any sphere of inquiry.

**Definition of Business Statistics:
**

Business statistics is the collection of the numerical data regarding business, presentation,

interpretation and analysis.

Examples: a) Production statistics.

b) buying and selling statistics.

c) Export and Import statistics etc.

Population:

Simply, Population means the aggregate of human individuals in a defined area or region. In

statistics, population refers to an aggregate of all individual or items defined on some common

characteristics.

Examples: a) All the students in a class constitute a population.

b) Students of Jagannath University.

c) Students of 2nd semester.

d) Students of the session 2008-2009.etc

A population can be classified into two groups:

Finite population: A population having a finite number of units or individuals or items is called

a finite population.

Example: The population are consisting the students of Jagannath University.

2|page

Department of Finance, Jagannath University

JONY

**Infinite population: A population having a infinite number of units or individuals or items is
**

called a infinite population.

Example: The population consisting of all possible outcomes (head and tail) in successive tosses of

a coin.

***A statistical population need not have anything to do with a human population.

Example: Suppose we want to know the average temperature of January-2010. Then the record of

temperature from 1st January-2010 to 31st January-2010 will constitute a population.

Population Size: Number of individuals/ items in the population. It is usually denoted by capital

βNβ.

Sample:

A representative and considerably small part of the population is called a sample. That is, a

sample is a sub-set or portion of the population selected to represent the population.

Example: A group of 30 students representing all the students in the class, is called a sample.

Population

Sample

Sample Size: Number of individuals/ items in the sample. It is usually denoted by small βnβ.

Variable:

A variable is a characteristic often but not always quantitatively measured, containing two

or more values or categories that can vary from person to person, place to place and time to time.

Examples: a) Gender is a variable which is compared of two categories, Male and Female.

b) Family size.

c) Price of a commodity.

d) Monthly income.

e) Height of person.

f) Weight of person. etc.

Note: Variable values constitute a data.

Classification of Variable

Variable

Qualitative/

Catagoral

Quantitative/

Numerical

Discrete

continious

Qualitative Variable:

The characteristics that can not be expressed in any numerical form but can arrange them

according to their quality or attribute are called Qualitative variable. A qualitative variable is one

for which numerical measurement is not possible.

Examples: a) Hair color. b) Blood group. c) Religion. d) Residence (urban, rural. Etc).

3|page

Department of Finance, Jagannath University

JONY

Quantitative Variable:

Quantitative variable is one for which the resulting observations, are numeric and posses a

natural ordering.

Examples: a) Height. b) Weight. c) Income. d) Expenditure. e)Age. f) Family size. Etc.

**Types of Quantitative Variable
**

Discrete Variable:

When a variable can assume only the isolated or integral values within a given name, it is

called a discrete variable. Here the possible values are not observed on a continuous scale. It

indicates that the values or the observation of the specified range are finite in number/ countable.

Examples: a) Number of children in a family.

b) Number of accidents per day in a city.

*** The discrete variable can not always take values 0, 1, 2, 3,β¦..; The important point is that, the

possible values of the variable are countable and separated from each other.

Example: a) Size of shoes. etc

Continuous variable:

A variable is said to be continuous if it can theoretically assume any value within a given

range. The range consists of an infinite number of elements or values that is, the values of the

variable differ by infinitely small magnitude from each other.

Examples: a) Height.

b) Weight.

c) Age.

d) Income.

e) Price. Etc.

Constant:

A numerical characteristic which does never change or vary its value is termed as constant.

Example: The ratio of circumference and diameter of a circle (Ο). And the value of Ο = 3.1416 is

for all the circles.

Data:

Data is the plural form of datum. Data are called raw material of statistics. A collection of

numbers or facts that is used as a basis for making conclusion are called data. In other word, Data

are the raw, disorganized facts and figures collected from any field of inquiry.

Examples: a) The marks obtained by 100 students in a class test.

b) Income of 50 people.

c) Age of 20 student. Etc.

Source of data:

Data are collected from two types of sources. They are,

1. Primary data: The data which are obtained by direct observations from the population or

sample is called primary data. The primary data are original in character and not well-organized

somehow; primary data are called raw data or original data. The collection of raw data is highly

expensive in respective of money, time and labor.

2. Secondary data: The data which are already obtained by some other persons or organizations

and are already published or utilized are called secondary data. In different countries, there are two

different sources of secondary data,

i. Published sources: International publications, Government and Non-government publication,

Research institution publication, Journal and Newspaper etc.

ii. Unpublished sources: Medical institutions, Hospital etc.

4|page

Department of Finance, Jagannath University

JONY

Scales of measurement:

Measurement is the assignment of numbers to objects or event according to the rules. With

which is compared for measuring is called measurement scale. Variables can be measured under

four levels or scales of measurement. The measurement scales are,

i.

ii.

iii.

iv.

Nominal Scale.

Ordinal Scale.

Interval Scale.

Ratio Scale.

Qualitative Data

Quantitative Data

Nominal Scale:

Levels of measurements which classify data in to mutually exclusive and have no logical

order, such that, values are assigned to various for identification only, are called Nominal scale.

Examples: a) Religion.

b) Marital Status.

c) Blood Group.

d) Nationality. Etc.

Ordinal Scale:

The measurement scale in which numbers are assigned to the categories or variables for

identification as well as ranking is call Ordinal scale.

Examples: a) Economic Status. b) Level of Education. c) Beauty. d) Merit. Etc.

Interval Scale:

The measurement scale in which numbers are assigned to the variable values in such a way

that data can be ranked, differences are meaningful is called Interval scale. Here the βzeroβ values

are not absolutely βzeroβ. (Zero are meaningless).

Examples: a) Temperature.

b) I.Q. Score.

c) Dates on Calendar. etc

Ratio Scale:

The measurement scale in which numbers are assigned to the variable values in such a way

that data can be ranked, differences are meaningful and there is a true βZeroβ, is called Ratio scale.

The ratios exist between the different units of measure.

Example: a) Height.

b) Weight.

c) Age.

d) Income.

e) Price

f) Expenditure. Etc.

**Md. Mazharul Islam (Jony).
**

Roll no: 091541, 3rd Batch.

Department of Finance.

Jagannath University.

5|page

Department of Finance, Jagannath University

JONY

Its purpose is to condense the raw data to display points of similarities and dissimilarities by suppressing irrelevant details. Jagannath University JONY . Classification and Tabulation: Classification is the process of arranging individuals in groups on classes according to their resemblances similarity or identity. A set of classes together with the frequencies of occurrence of values in each class in a given set on data presented in a tabular form. Construction of frequency distribution from categorical data The variable smoking status is a nominal variable attributable to two categories smokers and nonsmokers. so that it is easily understood and an investigator is quickly able to locate the desired information. c) Continuous frequency distribution: When the frequency distribution based on the data of a continuous variable. Identifying the workers of BPC as smokers and non-smokers and counting their number in each category. In discrete frequency distribution. Frequency distribution: Frequency distribution is a particular types of tabular.Presentation of Data: Statistical data can be presented by the following waysa) Classification and Tabulation. the distribution can be made in grouped and ungrouped ways. Tabulation involves the orderly presentation of numeral facts in tabular form so as to express the main features of their facts. Tabulation is the process of summarizing classified on group data in the form of a table. We can construct the following frequency distribution:Smoking Status Number of Workers Smokers 29 Non-smokers 21 Total 50 6|page Department of Finance. The most important form of tabulation form a statistical point of view is called a frequency distribution. In continuous frequency distribution. the distribution can be made in only ungrouped ways. A frequency distribution shows the number of observations from the data set that fall into each of the classes. is referred to as a frequency distribution. A table is a systematic arrangement of classified data in columns and rows. Types of frequency distribution: a) Categorical frequency distribution: A frequency distribution in which the data is only categorical or qualitative either nominal or ordinal. b) Discrete frequency distribution: When the frequency distribution based on the data of a discrete variable. then it is called continuous frequency distribution. then it is called discrete frequency distribution. b) Graphical Presentation. A sample classification is shown as.

Roll no: 091541. Mazharul Islam (Jony). Range = Highest value β Lowest value = (97 β 50) = 47. Solution: Frequency distribution of the number of children.Inclusive method) In the survey of 50 workers in BPC.322log10 π = 1 + 3.322log50 = 6.Frequency distribution for numerical data Example 1: (For discrete variable) In a survey of 40 families in a village.A. Jagannath University. n = Total Number of Observation). Department of Finance. And the number of classes can be determined by the formula of H. Sturges: K = 1 + 3. the number of children per family was recorded and the following data obtained1 0 3 2 1 5 6 2 2 1 0 3 4 2 1 6 3 2 1 5 3 3 2 4 2 2 3 0 2 1 4 5 3 3 4 4 1 2 4 5 Represent the data in the form of discrete frequency distribution. Department of Finance. Jagannath University JONY . Solution: Here. 7 Md.64 β 7. Number of Children Tally Marks Frequency Cumulative Frequency 0 3 3 ||| 1 7 10 |||| || 2 10 20 |||| |||| 3 8 28 |||| ||| 4 6 34 |||| | 5 4 38 |||| 6 2 40 || Total 40 Example 2: (For continuous frequency distribution.71 β 7. 3rd Batch. 7|page 47 ) = ( )= 6. The amount of wages per workers was recorded and the following data is obtained92 51 90 56 59 74 96 85 93 72 67 74 96 73 80 50 77 65 70 62 92 68 87 79 94 76 87 74 63 94 68 65 93 90 80 86 86 69 88 89 87 92 79 95 89 97 90 54 83 74 Represent the data in the form of continuous frequency distribution. Size of class interval/ Class width = ( π ππππ πΎ Frequency distribution of the amount of wages. (K = Number of Classes.

Size of class interval/ Class width = ( π ππππ πΎ 32 ) = ( )= 4. of 50 students was recorded and the following data is obtained42 54 58 42 47 Tally Marks 49 59 45 51 62 44 49 39 64 61 57 52 41 46 32 51 54 43 41 57 46 54 45 42 39 48 40 34 40 41 47 46 51 49 58 56 37 63 50 37 58 48 49 38 41 Represent the data in the form of continuous frequency distribution.322log10 π = 1 + 3.Wages (in Taka) 50 β 56 57 β 63 64 β 70 71 β 77 78 β 85 86 β 92 93 β 99 Frequency Cumulative Frequency 4 4 |||| 3 7 ||| 7 14 |||| || 8 22 |||| ||| 6 28 |||| | 14 42 |||| |||| |||| 8 50 |||| ||| Total 50 Example 3: (For continuous frequency distribution.. And the number of classes can be determined by the formula of H. (K = Number of Classes.) 30 β 35 35 β 40 40 β 45 45 β 50 50 β 55 55 β 60 60 β 65 || |||| |||| |||| |||| |||| |||| |||| | |||| ||| ||| || 2 5 11 13 8 7 4 50 Cumulative Frequency 2 7 18 31 39 46 50 Relative Frequency(%) 4 10 22 26 16 14 8 Class Interval: The difference between the lower limit and upper limit of any class is called the interval. The weight in K.57 β 5.G.G. then we can find out the class interval by the following formula.Exclusive method) In survey of 50 university student.A. Example: a) If in a class we have 15 and 10 as the highest value and lowest value respectively. Sturges: K = 1 + 3. Then the class interval = H β L = 15 β 10 = 5 b) When we have a data set at hand. 8|page Department of Finance. Range = Highest value β Lowest value = (64 β 32) = 32. n = Total Number of Observation). Solution: Here. Class Interval Tally Marks Frequency (Weight in K.322log50 = 6. Jagannath University JONY .G.64 β 7. 7 Frequency distribution of the weight in K.

3 4. Marks 20 β 30 30 β 40 40 β 50 Total Number if Students 5 8 17 30 Inclusive method: In this method no overlapping is permitted. Frequency Density: Frequency density of a class refers to number of frequency existing in a class interval of class from a frequency distribution. difference between the highest and the lowest value and we can easily divide the data into sections.99 would be included in the interval 30 β 40. also we can observe the distance between succeeding values in the data. (H = Highest value.0 3.1 4.99 is included.1 4.8 4. But the value from 30 to 39. L = Lowest value.9 3. Jagannath University JONY . The sum of all relative frequencies equals to 100 %( percent). Exclusive method: In exclusive method the highest value of a class interval and the lowest value of its successive class is same. Wages (in Taka) 50 β 56 57 β 63 64 β 70 71 β 77 Total Frequency 4 3 7 8 22 Class frequency: The number of observations corresponding to a particular class is known as the frequency of that class or the class frequency. Example: Data arrangement of average inventory (in days) for convenience stores2. And it is shown as. The formula to find out midpoint is. The midpoint of a class interval is its central value.2 4. On advantage of an array is that we can easily find the range. Class midpoint: Many times. a class βless than 40β or a class βover 90β is open ended class. And these are shown as <40. the value from 20 to 29. For example. Frequency density = πΉππππ’ππππ¦ ππ π ππππ‘πππ ππππ π πΆπππ π πππ‘πππ£ππ ππ π‘πππ‘ π πππππππ ππππ π .9 3. The data array is one of the simplest ways to present data. For example. i = Number of classes).8 3.Class interval = π»βπΏ π . that is. Class midpoint = π»πππππ π‘ π£πππ’π ππ π‘ππ ππππ π βπΏππ€ππ π‘ π£πππ’π ππ π‘ππ ππππ π 2 Open ended class: An open ended class is such a class in which at least one of the lower and higher value is not perfectly defined. Here in class 20 β 30. >90 or 90+. for mathematical operation we have to find out the class midpoints.4 4.1 4. because a relative frequency distribution pairs each class with its appreciate fraction or percentage of the total data.2 Relative frequency distribution: A relative frequency distribution presents frequencies in terms of fractions or percentages.0 4.8 4.4 4. 9|page Department of Finance. Here the highest value of any class and the lowest value of its successive class would not the same. Data arrangement: The arrangement of data either in ascending or descending order of magnitude is called an array. This is.7 5.

Among Different methods of graphical representation are:a) Bar Diagram.) c) Histogram d) Frequency Polygon or Frequency Curve. It is βrawβ because it is unprocessed by statistical methods. Following frequency distribution shows religion of a sample of 50 individuals10 | p a g e Department of Finance. When the number of observations is large. (For Quantitative or numerical data. Bars may be vertical and horizontal. e) Cumulative Frequency Polygon/ Curve or Ogive. They are called onedimensional because it is only the length of the bar that matters and not the width. The wide of the bars and the gap between one bar another should be uniform throughout. generally a horizontal line is drawn and the calculated angles for various components are constructed one often another with the help of protractor. (For Qualitative or categorical data. depending on the nature of the data involved and the purpose for which the graph is intended. b) Pie Chart.up of components given in percentage. lines may be drawn instead of bars to economize space. Graphical Presentation of Data A graph is a pictorial presentation of the relationship between variables. In 360Β° angle is divided in proportion to the percentages. In circle of a designed size. Jagannath University JONY .***Raw data: Information before it is arranged and analyzed is called raw data.) f) Graphs of Time Series or Line Graph. Bar Diagram: A bar is a thick line whose width is shown merely for attention. Many types of graphs are employed in statistics. Following frequency distribution shows religion of a sample of 50 individualsReligion Muslim Hindu Others Total Frequency 250 125 125 500 Construction Bar diagram: Bar Diagram 300 250 250 200 150 125 125 Muslim 100 Hindu 50 Others 0 Muslim Hindu Others Pie Chart: A pie chart is a circle divided into component sectors according to the break. The vertical bar should be preferred because they give better look.

5 14. The height of the bar for each class corresponds to the number of items in the class. then the vertical bars in the histogram are also of equal width. Histogram: This type of diagrammatic representation is more suited for frequency distributions with continuous class intervals. Class Interval 5β9 10 β 14 15 β 19 20 β 24 25 β 29 Frequency 8 29 27 12 4 Show this frequency distribution in Histogram and Frequency polygon.5 9.5 11 | p a g e Frequency 8 29 27 12 4 Department of Finance. The magnitudes of the class intervals are plotted along the abscissa (Vertical) and the frequencies are measured along with the ordinate according to the chosen scale.5 β 19.5 β 29.5 β 14. Jagannath University JONY . The above discussed frequency distribution is used to construct a histogramClass Boundary 4.5 β 9. A histogram is a series of rectangles each proportional in width to the range of values within a class and proportional in height to the number of items falling in the class.5 24. If the classes in the frequency distribution are of equal width.5 β 24. In this type of distribution the upper limit of a class is the lower limit of the following class.5 19.Religion Muslim Frequency 250 Angle(ΞΈ) 250Β° 360Β°Γ500Β° = 180Β° Hindu 125 360Β°Γ500Β° = 90Β° Others 125 Total 500 360Β°Γ500Β° = 90Β° ΞΈ = 360Β° 125Β° 125Β° Construction Pie diagram: Pie Diagram 125 Muslim 250 Hindu Others 125 Here is given the following frequency distribution.

5 Class Limits: In a class interval the end numbers.Construction of Histogram: 35 29 30 27 25 20 15 12 8 10 4 5 0 4.5 β 9. Let us consider the following frequency distribution.5 29. cumulative frequencies are on the vertical axis and the class boundaries or βless thanβ classes are on the horizontal axis and plotting each class frequency.5 24.5 12 22 24.5 4 27 Total 80 Construction of Frequency Polygon: 40 Frequency Polygon 30 20 10 0 2 7 12 17 Cumulative Frequency Polygon/ Curve(Ogive): 22 27 32 A graph showing the cumulative frequency less than any upper class boundary plotted against the upper class boundary is called a cumulative frequency polygon or Ogive. Jagannath University JONY .5 14. by drawing a dot above its βless thanβ class and connecting the successive dots with Straight line or free hand. An Ogive is based on cumulative frequency distribution.5 8 7 9. Class Boundaries: The class boundaries are obtained by adding the upper limit of one class interval to the lower limit of the next higher class interval and dividing by 2.5 29 12 14. Frequency Polygon: A frequency polygon is another way to portray graph.5 27 17 19.5 β 14. where frequencies on the vertical axis and the values of the variable.5 9. measuring on the horizontal axis.5 β 24. and plotting each class frequency.5 β 19. In cumulative frequency polygon or curve. The smaller number is the βlower class limitβ (60) and the larger number is the βupper class limitβ (62). By drawing a dot above its midpoint and connecting the successive dots with straight lines. A graph of frequency distribution is called an Ogive (pronounced βoh-jive).5 19. are called class limit. The above discussed frequency distribution is used to construct a frequency polygonClass Boundary Frequency Midvalue 4. 60 and 62. 12 | p a g e Department of Finance.5 β 29.

95 β 3.95 1.45 Less than 2.45 3.Class Boundary 1.45 Less than 4.45 4.45 β 4.45 7 2.45 4. The variable values are suitably scaled along the axis and all distances are measured from the origin.95 3.95 3. Years 2005 2006 2007 2008 2009 13 | p a g e Frequency 1650 1750 1870 1920 2050 Department of Finance.95 β 4.95 4.95 Class Less than 1. Following data present the number of students admitted in Jagannath University during last five years. In this type of graph.95 Construction of Cumulative Frequency Curve: Cumulative Frequency Curve 50 40 37 32 30 22 20 10 0 40 0 1.45 1.45 β 2. Jagannath University JONY .45 Less than 3.45 3 2 1.95 β 2.95 3.95 Less than 4.45 3. These graphs depict the trend or variability occurring in the data.95 7 3 2 2.95 4.95 Frequency 0 2 1 4 15 10 5 3 Cumulative Frequency 0 2 3 7 22 32 37 40 Construction of Cumulative Frequency Polygon: 50 Cumulative Frequency Polygon 40 37 32 30 22 20 10 0 40 0 1. A variable is taken along X-axis and other along Y-axis. we have two variables under consideration. The points are plotted and joined by line segments in order.95 2.45 2.45 3.95 Graphs of Time Series or Line Graph: A line graph is particularly useful for numerical data to show time series data.95 Less than 3.95 Less than 2.45 2.45 Less than 1.95 2.45 4. The independent variable should be taken on X-axis and the dependent variable an Yaxis.45 β 3.45 β 1.

the center of a set of data. π₯2 . Arithmetic mean is two types1. Types of measures of central tendency: The most commonly used measures of central tendency are: a) Mean b) Median c) Mode Mean: There are three types of means which are suitable for a particular type of data. Measures of central tendency or location of data are used to identify a typical value that can be used to describe the entire set. Jagannath University JONY . of a set of βNβ numbers π₯1 . The arithmetic mean or briefly the mean..+ π₯ π π = π π=0 π₯π π . π₯3 . ππ is denoted by π and is defined symbolically β 14 | p a g e Department of Finance. . Since such typical values tend to lie centrally within a set of data arranged according to magnitude. β¦ . They are. For discrete series. π₯2 . the arithmetic mean or briefly the mean. Simple arithmetic mean 2. of a set of βnβ numbers π₯1 .Construction of Line Graph: Line Graph 2500 2000 1500 1000 500 0 2005 1870 1750 1650 2006 2007 1920 2008 2050 2009 Central Tendency Definition: The central tendency of a set of data can be defined as the tendency of clustering of different values around a central value. β¦ . π2 . Weighted arithmetic mean Simple arithmetic mean: The process of computing mean in case of individual observations is very simple. in some sense. which is a representative of all other values in the data. average are also called central tendency. π₯π and its frequencies π1 . π3. π₯π is denoted by π₯ and is defined as symbolically β π₯= π₯ 1 + π₯ 2 + π₯ 3 + β¦β¦. The measures of central tendency (also known as βmeasures of locationsβ or βaverageβ) are the numerical values that locate. . π₯3 . It is also popularly known as average.β¦β¦. Add together the various values of the variable and divide the total by number of items. An average is a value that is typical or representative of a set of data. Mean Arithmetic mean Geometric mean Harmonic mean The Arithmetic mean: The βarithmetic meanβ is the sum of the values divided by the number of values.

25. Calculate the arithmetic mean of the wages. Sample mean: Sample mean is called a statistics (Characteristic or measure obtained from a sample). (m= Midvalue of various classes.) 5 15 32 42 15 12 4 Number of Workers Solution: Wages (ππ ) Number of Workers (ππ ) ππ ππ 200 5 1000 210 15 3150 220 32 7040 230 42 9660 240 15 3600 250 12 3000 260 4 1040 ππ = N =125 π₯π ππ = 28490 β΄ Average Wage = 15 | p a g e π₯π ππ π = 28490 125 = 227. 42.π= π₯ 1 π1 + π₯ 2 π2 + π₯ 3 π3 + β¦β¦.+ π₯ π ππ π = π π=0 π₯ π π π π . 30. In continuous series. 79 and 83. β΄ Arithmetic mean: 10+25+30+7+42+79+83 7 = 38 Example 2: Calculate the arithmetic mean from the following data: 2 3 4 5 6 7 8 9 10 Student Number 1 Marks Obtained 15 20 25 19 12 11 13 17 18 20 Solution: Student number(ππ ) Marks obtained (ππ ) ππ ππ 1 15 15 2 20 40 3 25 75 4 19 76 5 12 60 6 11 66 7 13 91 8 17 136 9 18 162 10 20 200 π₯π = 55 ππ = N = 170 π₯π ππ = 921 Example 3: Following table gives the wages paid to 125 workers in a factory. π₯= π π=0 π π π π π . 200 210 220 230 240 250 260 Wages (Tk. Example 1: Suppose we have the following observations: 10. Jagannath University JONY . Department of Finance. Population mean: Population mean is called parameter (Characteristic or measure obtained from a Population). and N= Total frequency). 7. arithmetic mean may be computed by applying the following method. f= Frequency of each classes.92 Tk.

Solution: Number of Children(ππ ) Frequency(ππ ) ππ ππ 0 3 0 1 7 7 2 10 20 3 8 24 4 6 24 5 4 20 6 2 12 Total n = 40 π₯π ππ = 107 β΄ Arithmetic mean (AM) = π π=0 π₯ π π π π = 107 40 = 5.Example 4: Find the arithmetic mean from the following frequency distribution. Solution: The mean of the given set of data is. 9. Find the mean.6 Example 6: The number of children in 40 families was found as: Number of Children Frequency 0 3 1 7 2 10 3 8 4 6 5 4 6 2 Total 40 Find the mean. Here. Jagannath University JONY . 6 and 10.3 Example 5: A set of data consists of the five values 5. the term βweightβ stands for the relative 16 | p a g e Department of Finance.35 β 6.35 Hence. 8. the mean number of children per family is 5. Weighted Arithmetic mean: Weighted arithmetic mean is commonly used in the construction of index number. Class Interval Frequency 11 β 15 12 16 β 20 14 21 β 25 13 26 β 30 11 Solution: Class Interval Class Midvalue(ππ ) Frequency(ππ ) ππ ππ 11 β 15 13 12 156 16 β 20 18 14 252 21 β 25 23 13 299 26 β 30 28 11 308 Total π₯π = 82 ππ = N = 50 π₯π ππ = 1015 β΄ Arithmetic Mean: π₯ = xi fi N = 1015 50 = 20. we compute weighted arithmetic mean. The term βweightβ stands for the relative importance of the different items. There are situations where the relative importance of the different items is not same. When this is the case. β΄π₯= π π=0 π₯ π π = 5+9+8+6+10 5 = 38 5 = 7.

Examples 1: The unit prices and the quantity of 3 food items consumed by a family in July 2009 were as follows: Food items Price in taka per kg.+ π₯ π π€ π π€ 1 + π€ 2 + π€ 3 + β¦β¦+ π€ π = π π=0 π₯ π π€ π π π=0 π€ π .+ π₯1 π₯2 π₯3 π₯π = π π 1 π=0 π₯ . Find the average speed. β¦ . harmonic mean is the inverse of the arithmetic mean of the reciprocals of the observations of a set. . π₯2 . In this mean the number of values divided by the sum of the reciprocals of each value. Jagannath University JONY . In other word. Harmonic mean (HM) = For discrete series. π€3 . The harmonic mean is a set of n numbers π₯1 . f= Frequency of each classes. (m= Midvalue of various classes.73. π₯3 . Solution: The average speed is obtained by using harmonic mean as: β΄ HM = 17 | p a g e 2 1 1 + 40 60 =48 Department of Finance. Solution: Food items Rice Sugar Potato Price in taka per kg. and N= Total frequency). HM = π π ππ π=0 π₯ π ππ’ππππ ππ π‘ππ π£πππ’ππ ππ’π ππ π‘ππ πππππππππππ ππ πππ π π£πππ’π = π 1 1 1 1 + + +β―.importance of different items. For continuous series or grouped data. π₯π is the reciprocal of the arithmetic mean of the reciprocals of the numbers. π₯3 . Quantity consumed Rice 18 32 Sugar 32 3 Potato 12 9 Compute the average price paid by the family on these items. π₯2 . π€2 . When any observation is βZeroβ. π€π depending on the significance or importance attached to the numbers. rates and time. (ππ ) 18 32 12 Hence. *** Harmonic mean is a suitable measure of central tendency when the data pertains to average speed. We associate with the numbers π₯1 . HM = π π π π=0π . The weighted arithmetic mean = Quantity consumed (ππ ) 32 3 9 π₯π = 44 π π=0 π₯ π π€ π π π=0 π€ π = 780 44 Total price paid (ππ ππ ) 576 96 108 π€π π₯π = 780 = 17. π₯π certain weighting factors π€1 . The Harmonic Mean (HM): The Harmonic mean is defined as the reciprocal of the arithmetic mean of the reciprocals of the observations. it cannot be calculated. .. . . β¦ . β¦ . Symbolicallyβ΄π₯= π₯ 1 π€ 1 + π₯ 2 π€ 2 + π₯ 3 π€ 3 + β¦β¦. Example 1: A person drove Uttara from Sador ghat at 40 km per hour and returned at 60km per hour.

if there are three items. π₯2 . π₯3 β¦ .8232 0. GM = = 18 | p a g e π π₯1 .14544 0.20000 0. To simplify calculation logarithms are used. .42855 0. and N= Total frequency).+πππ π₯ π π π π=0 ππππ₯ π And GM = Antilog For discrete series.Example 2: Calculate the harmonic mean from the following data: 30 β 40 40 β 50 50 β 60 60 β 70 70 β 80 Obtained Marks 15 13 8 6 15 Number of student Solution: Table for calculation of harmonic mean: Obtained Marks Midvalue(ππ ) Number of student(ππ ) 30 β 40 40 β 50 50 β 60 60 β 70 70 β 80 80 β 90 90 β 100 35 45 55 65 75 85 95 15 13 8 6 15 7 6 N =70 β΄ Harmonic mean (HM) = π π ππ π=0π₯ π = 70 1.06318 ππ = 1. Example 1: Find the geometric mean of 4.09204 0. π₯3 β¦ . we take the square root. If there two items. f= Frequency of each classes. π₯π When the number of items is three or more the task of multiplying the numbers and of extracting the root becomes excessive by difficult. log GM = ππππ₯ 1 + πππ π₯ 2 + πππ π₯ 3 +β―.28886 0.30039 π₯π =53. . Jagannath University JONY . GM = Antilog π π=0 ππππ₯ π π π π π=0 π π ππππ₯ π π π π π=0 π ππππ π π = . It is affected by the extreme values but not to extent of average. GM = Antilog For continuous series. Solution: The geometric mean of the given values is. the cube root and so on. π₯π 3 4 16 27 = 12. π₯2 .83 Geometric mean(GM): The Geometric mean of βnβ positive values is defined as the ππ‘π root of the product of n values. Geometric mean is a set of n positive numbers π₯1 . β΄ Geometric mean (GM) = π π₯1 . If anyone of the observations is βZeroβ or negative (-) then. π₯2 . β¦ . Department of Finance. for that observations geometric mean is not possible. π₯π is the ππ‘π root of the product of the numbers. . Like arithmetic mean it also depends on all observations. π₯3 . 16 and 27. *** The geometric mean is useful in finding the average of percentages..30039 80 β 90 7 90 β 100 6 ππ π₯π 0. or growth rates. . (m= Midvalue of various classes. ratios. indexes. Geometric mean then is calculated as follows.

89% β 100% = 19. 3 GM = 103 Γ 102. πΏπ = Lower limit of the class interval containing the median.Example 2: If a person receives a 25% raise after one year of service and 15% raise after the second year of service. Consequently. Me = ( π‘π score + π‘π score).5) =102.89% β΄The average percentage raise per year = 119.89%. find average percentage raise per year. fm = Frequency of the median class. arranged in increasing order that have half of the number of observations below it and remaining half above it.1% respectively. GM = 125 Γ 115 = 119.5% and 2.1) =102. arranged in ascending or descending order). Median (Me): The median of a set of numbers arranged in order of magnitude is either the middle value or the arithmetic mean of the two middle values. In a set of observations.e. Find the average population growth.5% At the end of the second year the growth rate = (100+2.53%.0%.5 Γ 102.53% β΄ The average population growth rate per year = 2. Me = Size of π+1 2 th item. ** When n is odd.1% And the geometric mean of growth rates is. median is the value of a variable. Note: π *** Median class is identified from the cumulative frequency column on the basis of the value of . 2.1 =102. N = Total number of observations. Solution: At the end of the first year the salary of the person is (100+25) = 125% At the end of the second year the salary of the person is (100+15) = 115% Using the geometric mean the average percentage of his salary is. Me = Average of th and ( +1)th observations 2 2 1 π n+2 2 2 2 Or. Jagannath University JONY . Solution: At the end of the first year the growth rate = (100+3) = 103% At the end of the second year the growth rate = (100+2. The median by definition refers to the middle value in a distribution (i. i = Width of median class. fc = Cumulative frequency of the pre-median class. For continuous series or grouped data. 2 *** Median cannot be used for Nominal data because ranking is not possible. the median is preferred over the mean as a measure of central tendency for the data sets that contains outliers. π π ** When n is even. Example 3: The growth rate of population of a country in three successive years was 3. *** The advantage of using the median as a measure of central tendency is that it is not influenced by outliers. For discrete series. Me = πΏ0 + π βππ 2 ππ Γπ Where. 19 | p a g e Department of Finance.

Arranging the data in ascending order we have. 17. 30. 2 20 | p a g e Department of Finance. 16. 2 7+1 2 th score. which is even. 13. 20. = 4 th score. 20. 13. 2 1 = (2 + 3). 13. 2 1 = (22 + 24). 30 1 π β΄Median = ( π‘π score + n+2 2 2 1 10 = ( π‘π score + 2 1 2 π‘π score). 25. = (14π‘π score + 15π‘π score). 18. 20. which is odd. 24. Arranging the data in ascending order we have. 22 . 2 10+2 2 π‘π score). 18.Example 1: Find the median for the following set of data. 10. 17. 13. 2 = 23 (Ans) Example 3: Find the median for the following data: x 1 2 3 4 Solution: x f 1 5 2 9 3 8 4 6 N = 28 Here N = 28 (even). 22. 1 π N+2 2 2 1 28 2 28+2 β΄Median = ( π‘π score + = ( π‘π score + 2 1 2 2 f 5 9 8 6 cf 5 14 22 28 π‘π score). 26. 24. 26. π‘π score). Jagannath University JONY . 10 Solution: Here n = 7. 24. 29. 16 . 19. 19. 32 β΄ Median = = π+1 th score. 25 Solution: Here n = 10. 29. 24 . = (5π‘π score + 6π‘π score). 20. = 16 Example 2: Find the median for the following set of data. 32.

5 β 25.5 β 30.5 β 20. i = 20.30 Solution: Class Class Boundary 11 β 15 10.64 = 20.30 25.= 2. Mazharul Islam (Jony).5 26 . c = The length of the modal class. Note: A set of data can have more than one mode or no mode at all. then the interval that has highest frequency is called the model class and its midpoint is called the crude mode.14 (Ans) Mode (Mo): The mode of a set of numbers is that value which occurs with greatest frequency.5 + Γπ ππ 25β12 14 Department of Finance. the value that occurs the maximum number of times and it is the most common value. And Median class = 15. πΏπ = Lower limit of the modal for which the frequency is maximum. 2 = 25th observation. πΏπ = 15.5 β 15.5 β 15. Jagannath University JONY . β1 = The difference between the frequency of the modal class and the pre-modal class. 3rd Batch.5 + 4.5. Γ5 = 15. that is. which lies in the class 15.5 N = 25 fc = 12 Md.5 16 β 20 15. If the data is grouped in intervals.5 f 12 14 13 11 f 12 14 13 11 N =50 cf 12 26 39 50 π Here. 21 | p a g e Department of Finance.5. β2 = The difference between the frequency of the modal class and the post-modal class. Jagannath University.5 = 5 β΄ Me = πΏ0 + π βππ 2 = 15.5 β 20.5 21 β 25 20. fm = 14 Roll no: 091541.5 β 20.5 (Ans) Example 4: Find the median for the following data: x 11 β 15 16 β 20 21 β 25 26 . Mo = πΏπ + Ξ1 Ξ1 + Ξ2 Γπ Where. Median = th observation. In continuous series or grouped data.

6. 6. 45. Weight 58 60 61 62 63 64 65 66 68 70 Number of person 4 6 5 10 20 22 24 6 2 1 Solution: Mode = 65 kg (since it has maximum frequency). 2. 55. 4. Jagannath University JONY . 9. But it cannot be said that the mode is βZeroβ. Major Number of student Finance 1550 Accounting 1125 Management 862 Marketing 328 Hotel Management 135 Total 4000 22 | p a g e Department of Finance. Example 4: A survey show the following distribution for the number of students chooses the subject in each field. 10.The mode is the only measure of central tendency that can be used in finding the most typical case when the data are categorical or nominal. The crude mode = 16+20 2 = 18 (midpoint of the modal class). A distribution having only one mode is called unimodal. 55. 55 Solution: a) Since 6 occurs the maximum number of time (3 times). there is no mode. Example 3: Find the mode for the following distribution. b) Since each value occurs only once. Class Frequency 11 β 15 12 16 β 20 14 21 β 25 13 26 β 30 11 Solution: Modal class = 16 β 20 (since it has maximum frequency). 50. 5. This set of data is said to be bimodal Example 2: The following data are the weight of 100 persons. 8. 40. 7. b) 3. 9. c) Since both 45 and 55 occur the maximum number of times (3 times). the modes are 45 and 55. Determine the modal weight. 8. 45. Example 1: Find the mode for the following sets of data: a) 3. the mode is 6. 15 and 16 c) 45. Find the mode. 5. 12. 6.

π₯3 . 2. the most typical case is βFinanceβ major.ith decile class.β¦. [i = 1. π₯1 .99] Department of Finance.Solution: Since the category with highest frequency is βFinanceβ. π Γπ +1 π‘π πππ πππ£ππ‘πππ 4 (When n is even). Jagannath University JONY . π₯π be a series of n observations and they are arranged in order of magnitude. fd = Frequency of the ith decile class. ππ = πΏ0 + 23 | p a g e π+1 π π Γπ βππ 100 ππ Γπ . Percentiles: The percentiles of a set of data are those values which divide the total observations into 100 equal parts.β¦. For ungrouped data.99](When n is odd). π·π = πΏ0 + π Γπ βππ 10 ππ Γπ . fc = Cumulative frequency of the pre. π₯π be a series of n observations and they are arranged in order of magnitude. 2. π₯1 . ith deciles π·π = And π·π = π Γπ π‘π ππ‘ππ + 10 10 π‘π observation. π₯π be a series of n observations and they are arranged in order of magnitude. [i = 1. . [i = 1. That is a quartile divides the data into four equal parts. π+1 π For ungrouped data. β¦ . ππ i= 1. π₯3 . π Γπ +1 π‘π πππ πππ£ππ‘πππ 100 2 For grouped data. 2. π₯2 . 2 For grouped data.9] Where. . N = Total number of observations. c = Class interval of the ith decile class . Let. π₯2 .β¦. π₯2 . [i = 1. π₯3 . 2. β¦ . ππ = πΏ0 + π Γπ βππ 4 Γπ . π₯1 . Let. 2. 2. 2.ith quartile class. β¦ . [i = 1. πΏπ = Lower limit of the ith quartile class. c = Class interval of the ith quartile class . Where.9] (When n is even). For ungrouped data.β¦. (When n is odd). Quartiles: Quartiles are that values in a set of observations are arranged in order of magnitude which divides the total observation into quarters.99] (When n is even). Let.9](When n is odd). 2 For grouped data. Deciles: The deciles of a set of observations are those values which divide the total observations into 10 equal parts.β¦. N = Total number of observations. π Γπ +1 π‘π ππ‘ππ 10 [i = 1. 3. ith quartiles ππ = And ππ = π Γπ π‘π πππ πππ£ππ‘πππ + 4 π+1 π 4 π‘π observation. πΏπ = Lower limit of the ith decile class. fc = Cumulative frequency of the pre. . fq = Frequency of the ith quartile class. ith deciles ππ = And ππ = π Γπ π‘π πππ πππ£ππ‘πππ + 100 100 π‘π observation.β¦.

not the intermediate steps. The effect of coding on mean is given below: 1. Coding Method: A linear transformation of data may be regarded as coding. the mean is also reduced by the constant value. = Cumulative frequency of the pre. 7. It should have sampling stability. 4. 3. If we subtract an arbitrary constant from each of the observation. But the availability of electronic calculators and computers has diminished the importance of coding of data. Jagannath University. Anyhow. Department of Finance. A change can involve either a change of origin or a change of scale or a change of both. 24 | p a g e Department of Finance. it can be used whenever needed. It should be based on all the observation. 3rd Batch. Mazharul Islam (Jony). origin and scale together. It should not be unduly affected by the presence of extreme value. = Class interval of the ith percentile class. = Frequency of the ith percentile class. Md. the word reduced should be replaced by βincreasedβ in the above statements. 6. The lies in choosing the measure as no hard and fast rules have been made to select any one. To avoid roundβoff buildup. Mazharul Islam (Jony). Roundβoff Rule: The measures of central tendency should be rounded to one more decimal place than occurs in the original data. The above two operations cut short the calculation. Properties of a good Average ( Measure of Central Tendency): There are various measures of central tendency. = Total number of observations. Roll no: 091541. Note: In case of addition or multiplication. 2. πΏπ N fc fp c = Lower limit of the ith percentile class. It should be easy to understand. It is a very short method and should always be used for grouped data where the class-interval sizes are equal. Roll no:091541. A measure of central tendency is good or satisfactory if it possesses the following characteristics. In coding we shift the origin and the scale. In the coding method the values of the variable βxβ are transformed into the values of the variable βuβ according to π’π = π₯ π βπ΄ π . Jagannath University JONY . β¦β¦β¦β¦β¦ π₯ = A+cπ’. If we divide each observation of a set by an arbitrary constant. Department of Finance. It should be capable of further algebraic treatment. 2. It should be rigidly defined. Md. 1.Where. 3rd Batch. round-off only the final answer.ith percentile class. It should be simple to compute. 5. The calculation can be simplified by taking the deviations of the given values π₯π from any arbitrary value A (Origin) and dividing by c (Scale) in case of grouped frequency distribution. the mean is reduced as many times as the constant divisor.

οΌ When the distribution is skewed. (π₯π β π₯ )2 is minimum. or Mode = 3Median β 2Mean. Jagannath University. π₯12 = π 1π₯1+ π 2 π₯2 π 1 +π 2 . Relation among Mean. The advantage of this formula is that we do not have to do the entire calculations for the mean of the combined set of observations again. 2 or Median = Mode + [Mean β Mode]. Moreover. 3 25 | p a g e Md. Jagannath University JONY . Roll no: 091541. Median and Mode or a moderately Skewed distribution.e. we can say that arithmetic mean is a good measures of central tendency. οΌ It cannot be used for open end class of a frequency distribution. (π₯π β π₯ ) = 0 2. Median and Mode: Karl pearson has expressed the following empirical relationship among Mean.e. οΌ It cannot be used for categorical data. The average age of boys in a firm is 20 years and that of girls is 18 years. Pooled or Combined mean: If we have arithmetic mean π₯1 and π₯2 of two groups (having the same unit of measurement of a variable). Properties of the arithmetic mean: 1.The arithmetic mean is the most popular and widely used measure of central tendency because it meets the first above six properties. Mean β Mode = 3[Mean β Median].4 Note: *** When any statistical measurement is analyzed from Sample then small βnβ is used. i. 3rd Batch. the formula for two groups can be extended to any number of groups. Solution: The combined age of all student is: π₯π = 7Γ20+3Γ18 10 = 194 10 = 19. *** When any statistical measurement is analyzed from Population data then capital βNβ is used. based on sizes π1 and π2 observations respectively. Limitation of arithmetic mean: οΌ It is highly affected by extreme values. From the comparison of measures of central tendency. Mazharul Islam (Jony). we can compute the mean π₯12 of the variable values of the groups taken together from the individual means by the formula. Example: In a class there are 7 boys and 3 girls. The sum of the squares of the deviations of a given values from their AM is minimum. The algebraic sum of the deviations of a set of numbers from their arithmetic mean is βZeroβ. Find the average age of all the students. i. Department of Finance. Department of Finance.

Coefficient of Range (R). [β΅ π1 = 1st Quartile. Symbolically. Absolute Measure of Dispersion: When dispersion is measured in original units then it is known as absolute dispersion. d) Variance (π 2 ). percentage etc. S = Smallest item]. In other words.quartile range or quartile deviation by dividing it by 2. Inter-quartile range represents the difference between the third quartile and the first quartile. the relative measures of dispersion are as follows: I. Coefficient of Mean Deviation (MD). relative measures of dispersion are expressed in terms of ratio. The measurement of the scatter of the values of a data set among themselves is called a measure of dispersion or variation. Inter-quartile is the range which includes the middle 50 percent of the observation. a) Absolute measures of dispersion. III. In other words. Coefficient of Quarantine Deviation (QD). Range: Range is the simplest method of studying dispersion. The Relative Measure of Dispersion: A relative dispersion is independent of original units. Quarantine Deviation: The quartile deviation is another type of range obtained from the quartiles. Coefficient of Variance (π 2 ). π2 = 2nd Quartile] Department of Finance. The range is a set of numbers is the difference between the largest and smallest numbers in the set. Jagannath University JONY . e) Standard Deviation ( π 2 = S). Symbolically. The inter-quartile deviation is obtained by dividing the difference between upper quartile (π3 ) and lower quartile (π1 ) by 2.Measures of Dispersion Definition of Dispersion/ Variation/ Scattered/ Spread: The degree to which numerical data tend to spread about an average values is called the variation of dispersion of the data. Measures of Dispersion: The measures of dispersion can be distinguished by two major categories. Inter-quartile range = π3 β π1 The inter-quartile range is reduced to the form of the semi inter. the distance of different values from the central value is called dispersion. II. Generally. b) Quarantine Deviation (QD). It tells how the values are dispersed/ spread among them. Semi Inter-quartile range or Quartile Deviation = 1 β΄Quartile deviation defined as = QD = (π3 β π1 ) 2 26 | p a g e π3 βπ1 2 . b) Relative measures of dispersion. c) Mean Deviation (MD). Here. The five importance absolute measures of dispersion are as follows: a) Range (R). The measure of dispersion are called average of second order. Range = L β S [L = Largest item. IV.

For ungrouped data. [ π π=0 ππ = .D. 2 Mean Deviation: Mean deviation is obtained by calculating the absolute deviations of each observation from mean or median or mode and then averaging these deviations by taking their arithmetic mean.(Mo) = π π=0 π₯ π βππ π π π π=0 π π₯ π βππ π . = 3Γ 12 4 = 9. For ungrouped data. Rules for Calculating Mean Deviation: Let.5 β 21) =17. 1) M. 1)M. Note: *** Quartile deviation must be arranged in ascending order. π₯1 . π π π=0 π π π₯ π βπ₯ π [π₯ = Arithmetic mean.] π π=0 ππ = . π₯2 . π 3π 4 4 c) For π3 .(π₯ ) = For grouped data. 2) M.Rules for calculating πΈπ πππ πΈπ : π 1 π π 4 2 4 4 a) If n is divisible by 4 ( is a integer). = 54+59 2 = 56. π π=0 π₯ π βππ 2) M.75 Ans. π₯3 . .[ π π=0 ππ = n] Department of Finance.D.(Mo) = For grouped data.(Me) = For grouped data. π b) If n is not exactly divisible by 4 ( is not a integer).(Me) = π . [ n] Mean deviation from median. β΄ π3 = Average of 9th and 10th observation. then π1 has the value of the next higher 4 integer. = 19+23 For π3 = 2 3π 4 = 21. π₯π be a series of n observations. then the mean deviation can be expressed as: Mean deviation from mean. π π=0 π π π₯ π βππ π [Me = Median] . 1)M.5 1 β΄ QD = (π3 β π1 ) 2 1 = (56. For ungrouped data.D. then π1 = { th + ( +1)th} ordered value. π 12 4 4 β΄ = = 3 [Which is an integer] β΄ π1 = Average of 3rd and 4th observation. only replace by .D. Jagannath University JONY .(π₯ ) = π π=0 π₯ π βπ₯ . 27 | p a g e 2) M.D. [Mo = Mode] n] Mean deviation from mode.D. β¦ . For ungrouped data: Example: Calculate Quartile deviation from the following raw data: 32 14 19 17 23 40 80 54 59 27 71 48 Solution: Arrangement of data values in ascending: 14 17 19 23 27 32 40 48 54 59 71 80 Here n = 12.

π₯2 . Standard deviation is also known as root mean square deviation for the reason that it is the square root of the means of square deviations from the arithmetic mean.Variance: Variance is the square of standard deviation. π₯1 .) Department of Finance.7 = 5. . For grouped data.49 = 43. π₯π be a series of n observations. Jagannath University JONY . π 2 π=0(π₯ π βπ₯ ) = π π π π=0 π (π₯ π βπ₯ ) π π 2 π=0 π₯ . Variance is the arithmetic mean of the squared deviations from the mean of the distribution. The standard deviation is the most important measure of dispersion. For ungrouped data. π₯3 .7 10 100 5.7 15 225 0. It is generally denoted by small Greek letter βπβ (sigma) for population data and βSβ for sample data and expressed by.9 β 246.7 8 64 7. then the variance can be expressed as: For ungrouped data. Variance is generally denoted byβπ 2 β (sigma square) for population data and βπ 2 β for sample data Rules for Calculating Variance: Let.[ π β π π=0 ππ = 2 π π=0 π₯ π . π π=0 π π (π₯ π βπ ) π2 = π .7 16 256 0.) 2 π π=0 π₯ π = 2899 10 β 157 2 10 = 289. n] And If population data is used then.7 12 144 3. Standard Deviation: The standard deviation is the positive square root of the mean of the squared deviations from their mean of a set of values.9 β 24649 100 = 289. It is an improvement over the mean deviation. variance and standard deviation for the following data: 5 8 10 12 15 16 20 22 24 25 Solution: π₯π π₯π 2 π₯π β π₯ 5 25 10.3 π π 2 π π=0 π₯π = 157 π=0 π₯π β π₯ = 57 π=0 π₯π = 2899 π π=0 π₯ π Where. π (π₯ βπ₯ )2 π=0 π S= S= π π π (π₯ βπ₯ )2 π=0 π π π Example: Find mean deviation. In other words.7 (Ans. β¦ . π₯ = β΄ MD = β΄ π2 = 28 | p a g e π π π₯ π=0 π βπ₯ π π 2 π=0 π₯ π β = = 157 10 57 10 = 15.41 (Ans.3 24 576 8.3 22 484 6.3 20 400 4.. π 2 = π2 = For grouped data.3 25 625 9.

the sample SD and π₯ . For this reason. = Γ 100% π₯ Note: a) In case of sample studies. 29 | p a g e Department of Finance. (Ans.83 ππ 2 (Ans. π C. then the coefficient of variation is.83 = 3. b) The coefficient of variation is independent of the units used.) = 9. the sample mean instead of β²πβ² and π₯ respectively. The disadvantage of the coefficient of variation is that it fails to be useful where π₯ is close to βZeroβ.V.V. The coefficient of variation is denoted by C.41 = 6.07 = 9. we use βSβ.) Coefficient of variation: The coefficient of variation of a series of variate values is the ratio of the standard deviation to the mean multiplied by 100.9 β 734. Lengths 20 β 22 23 β 25 26 β 28 29 β 31 32 β 34 Frequency 3 6 12 9 2 Solution: Lengths 20 β 22 23 β 25 26 β 28 29 β 31 32 β 34 ππ 3 6 12 9 2 π π=0 ππ = 32 Midvalue (π₯π ) 21 24 27 30 33 π π=0 π₯π = 135 2 β΄ Variance.) Example: The lengths of 32 leaves were measured correct to the nearest mm. π = π 2 π=0 π₯ π β β΄ Standard deviation. S = 2 π π=0 π₯ π = 23805 π (π₯ βπ₯ )2 π=0 π π 32 β 867 2 32 ππ π₯π 63 144 324 270 66 π π=0 ππ π₯π =867 ππ π₯π 2 1323 3456 8748 8100 2178 π 2 π=0 ππ π₯π = 23805 = 743. The coefficient of variance express the SD (Standard deviation) as a percentage of the arithmetic mean. it is a relative measure of dispersion.315 mm. Find the variance and standard deviation. π 2 . Jagannath University JONY . and if SD or (π) is the standard deviation and π₯ is the mean of the set of values. it is useful in comparing distributions where the units may be different. Age groups (years) 15 β 19 19 β 23 23 β 27 27 β 31 31 β 35 35 β 39 Number of groups 8 59 47 23 6 4 Find MD. Example: The distribution of age at the marriage of grooms with brides of age group 15-19 is displayed here.β΄ S= π (π₯ βπ₯ )2 π=0 π π = 43.59(Ans. S and CV .

It should be easy to understand.3582(Ans. Mean deviation 4 = (Standard deviation) 5 2 Quartile deviation = (Standard deviation) 3 These are consequences of the fact that for the normal distribution.4853 = 18.67 %( Ans.V. we can say that standard deviation is a good measure of dispersion.48 52. π₯ = π π=0 π π π₯ π π π π π=0 π π₯ π βπ₯ β΄ ππ·π₯ = π β΄ Variance.88 = 24.2704 667 198 148 π π=0 ππ π₯π = 3563 π 2 π=0 ππ π₯π = π π=0 ππ (π₯π 89059 β π₯ )2 = 2698. It should be rigidly defined.6672 109.3869(Ans. It has great practical utility in sampling and statistical interface.7979 and 0. It should be based on all the observation. Jagannath University JONY . 5.72 19343 6534 5476 521. π 2 = 23 6 4 π π=0 ππ = n=147 = 3563 = ππ π₯π 2 ππ (π₯π β π₯ )2 ππ π₯π β π₯ 136 1239 1175 2312 26019 29375 419.3582 = 4.4256 651.3584 27. we have the empirical formula.1248 460.3408 619.04 π π=0 ππ π₯π β π₯ = 497. It should not be unduly affected by the presence of extreme value. respectively. S = π 4.88 147 π 2 π=0 π π π₯ π = 3. we find the mean deviation and quartile deviation range are equal. A measure of dispersion is good or satisfactory if it possesses the following characteristics.8435β587.Solution: Class interval Midvalue (π₯π ) 17 21 25 15 β 19 19 β 23 23 β 27 27 β 31 31 β 35 35 β 39 Frequency (ππ ) 8 59 47 29 33 37 π π=0 π₯π = 162 Where.24 147 497.) Γ 100% = 17. 6. = Γ 100% = ππ π₯π 2 π π=0 π π π₯ π π π π (π₯ βπ₯ )2 π=0 π π π = 89059 147 β 3563 2 147 = 605. The standard deviation is the most popular and widely used measure of dispersion because it meets above six properties.1472 57. Properties of a good Spread (Measures of dispersion): There are various measures of dispersion.) = 18. It should be capable of further algebraic treatment. It should have sampling stability.28 π₯ 24. The lies in choosing the measure as no hard and fast rules have been made to select any one. 2.28(Ans. It should be simple to compute. 3.16 35. 7.24 β΄ C. From the comparison of measures of dispersion.92 191.) β β΄ Standard deviation.6745 times the standard deviation.56 51. 4.) Empirical Relation between Measures of Dispersion: For moderately skewed distributions. 30 | p a g e Department of Finance. 1. to 0.

Department of Finance. π π 3 π=0(π₯ π βπ₯ ) π π 4 π=0(π₯ π βπ₯ ) π These four moments are known as the first four corrected or central moments. π₯3 . Now putting r = 1. and defined as. 3. 3. π₯2 . 4 we have 1st raw moments π1β² = 2nd raw moments π2β² = 31 | p a g e π 1 π=0 (π₯ π βπ΄) = π π 2 π=0 (π₯ π βπ΄) π π π π=0 π₯ π β π=0 π₯ π = π π=0 π₯ π π β π π=0 π΄ π =π₯β ππ΄ π =π₯βπ΄ . . π3. 3. For grouped data: If the values of π₯1 . 2. 2. The Greek letter π (read as mu) is generally used to denote the moments.moments Definition of moments Moments are popularly known used to describe the characteristics of a distribution. β¦β¦β¦) . Jagannath University JONY . And all terms are as like as ungrouped data. 4. Generally moments are of two kinds. 2. ππ respectively .. π2 . π₯π be a data set of n values then π π‘π corrected moment is the moments about their mean π₯ . They represent a convenient and unifying method for summarizing many of the most commonly used descriptive statistical measures such as central tendency. then the π π‘π central moments can be written as. π₯2 . Now putting r = 1. 4 we have 1st central moments π1 = 2nd central moments π2 = 3rd central moments π3 = 4th central moments π4 = π 1 π=0(π₯ π βπ₯ ) π π 2 π=0(π₯ π βπ₯ ) = π π π=0 π₯ π β π=0 π₯ π = π π=0 π₯ π π π π=0 π₯ β π =π₯β ππ₯ π =π₯βπ₯=0 =π 2 = variance. π₯3 . β¦β¦β¦) . ππβ² = π π π=0(π₯ π βπ΄) π r =(1. π₯π are repeated π1 . . 2. β¦β¦β¦) . a) Central or corrected moments: When the moments are computed from the arithmetic mean of the distribution. . β¦ . 2. β¦ . ππ = π π π=0 π π (π₯ π βπ₯ ) π r =(1. A set of constant or descriptive measures which can characterize a set of values or observations uniquely is called moments. For ungrouped data: If π₯1 . π₯π be a data set of n values then π π‘π raw moment about an arbitrary value βAβ is defined as. 4. Just use ππ for each central moments. b) Raw moments: Sometimes we use arbitrary value βAβ other than the arithmetic mean π₯ to define moments.β¦β¦. then the moments are called central moments. ππ = π π π=0(π₯ π βπ₯ ) π r =(1. π₯2 . 3. 4. 3. variation etc. then the moments are called raw moments. For ungrouped data: If π₯1 . π₯3 . β¦ .

. β¦ . β¦β¦β¦) . π₯3 . Moments about Origin: The raw moments about origin is : If A = 0 then πΎπ = π π π=0 π₯ π [here πΎ is read as neu) π 1st moment about origin. π π { π₯ βπ΄ β(π₯ βπ΄)}3 π π=0 π . π3. And all terms are as like as ungrouped data. by definition.β¦β¦. ππ respectively . π₯π are repeated π1 . Jagannath University JONY . π₯2 . π π π=0 π π (π₯ π βπ₯ ) ππβ² = π r =(1. π₯2 . 1st four central moments in terms of raw moments: Let π₯1 . π π=0 π₯ π βπ΄ π (π₯ β π΄) + π 2 π=0(π₯ βπ΄) π β²2 π=0 π 1 π π π(π 1β² )2 + π + (π1β² )2 π 3 π=0 (π₯ π βπ₯ ) π π 3 π=0(π₯ π βπ΄βπ₯ +π΄) .π 3 π=0(π₯ π βπ΄) 3rd raw moments π3β² = π π 4 π=0(π₯ π βπ΄) 4th raw moments π4β² = π . . 3. =π₯β ππ₯ π =π₯βπ₯=0 π π 2 π=0 { π₯ π βπ΄ β(π₯ βπ΄)} π π 2 π=0 (π₯ π βπ΄) β2 π 2 π=0 (π₯ π βπ΄) π π π 2 π=0 π₯ π βπ΄ (π₯ βπ΄)+ π=0(π₯ βπ΄) π β2 = π2β² β 2π1β² π1β² + = = = ππ΄ π2β² β 2(π1β² )2 π2β² β 2(π1β² )2 π2β² β (π1β² )2 . π₯π be the set of n observations with arithmetic mean π₯ and βAβ be any arbitrary value. π π4β² = . 2. πΎ1 = π π=0 π₯ π π =π₯ 1st raw moment about origin is equal to Arithmetic mean. These four moments are known as the first four corrected or central moments. For grouped data: If the values of π₯1 . β¦ . . β΄ 1st central moment π1 = β΄ 2nd central moments π2 = π 1 π=0(π₯ π βπ₯ ) π = π π 2 π=0(π₯ π βπ₯ ) π π π=0 π΄ β = = = = =π₯β β΄ π2 β΄ 3rd central moments π3 = = = 32 | p a g e = π₯ β π΄. π1β² = π 1 π=0 (π₯ π βπ΄) π π2β² = = π π π=0 π₯ π β π=0 π₯ π 2 π=0 (π₯ π βπ΄) π π = π π=0 π₯ π π π π 3 (π₯ βπ΄) π=0 π π3β² = . Department of Finance. . 4. π₯3 . π2 . then the π π‘π raw moments can be written as. π π π=0 π₯ π β π=0 π₯ π π=0 π₯ π = π π (π₯ βπ΄βπ₯ +π΄)2 π π=0 π β π 4 π=0 (π₯ π βπ΄) π π π=0 π₯ π . Just use ππ for each central moments. Where (π₯ β π΄) and four raw moments are.

Where (π₯ β π΄) and four central moments are. . +6 π π . Jagannath University JONY . π(π₯ βπ΄)2 π . π₯2 . π₯π be the set of n observations with arithmetic mean π₯ and βAβ be any arbitrary value. π₯3 . β΄ π3 π 4 π=0 (π₯ π βπ₯ ) β΄4th central moments π4 = = π . β 4 π3β² π1β² β 4 π3β² π1β² + 6π2β² (π1β² )2 + 6π2β² (π1β² )2 β 4(π1β² )4 β 3(π1β² )4 . π1 = π 1 π=0 (π₯ π βπ₯ ) π = π2 = π π π=0 π₯ π β π=0 π₯ π π 2 (π₯ π=0 π βπ₯ ) π β΄1st raw moments π1β² = β΄2nd raw moments π2β² = = π π=0 π₯ π π π3 = . π(π 1β² )4 + π (π1β² )4 Note: The formula is used for this moment: (π β π)4 = π4 β 4π3 π + 6π2 π2 β 4ππ3 + π4 1st four raw moments in terms of central moments: Let π₯1 . π(π₯ βπ΄) π [ π π=0 + π 2 π=0(π₯ βπ΄) π π₯π β π₯ = 0] Department of Finance. π = π4β² β 4 π3β² π1β² + 6π2β² (π1β² )2 β 4(π1β² )4 + π4β² π4β² . π . π π π 4 3 π₯ βπ΄ +6 ππ=0 π₯ π βπ΄ 2 π₯ βπ΄ 2 β4 ππ=0 π₯ π βπ΄ π₯ βπ΄ 3 + ππ=0 π₯ βπ΄ 4 π=0 π₯ π βπ΄ β4 π=0 π₯ π βπ΄ . =π₯βπ΄ =S π π 2 π=0 { π₯ π βπ₯ +(π₯ βπ΄)} π π 2 π=0 (π₯ π βπ₯ ) +2 π 2 π=0 (π₯ π βπ₯ ) π π π 2 π=0 π₯ π βπ₯ (π₯ βπ΄)+ π=0 (π₯ βπ΄) π +2 =π2 + 0 Γ π + =π2 + π 2 33 | p a g e ππ₯ π π=0 π₯ π βπ₯ π π(π)2 π . Let π₯ β π΄ = S.π 3 π=0 π₯ π βπ΄ β3 = π 3 π=0(π₯ π βπ΄) = π π 2 π₯ βπ΄ +3 π=0 π₯ π βπ΄ β3 π 2 π=0 π₯ π βπ΄ π . π π π π π 4 3 2 2 3 π(π₯ βπ΄) π(π₯ βπ΄) π=0(π₯ π βπ΄) π=0 π₯ π βπ΄ π=0 π₯ π βπ΄ π=0 π₯ π βπ΄ π(π₯ βπ΄) β4 π 3 π=0 (π₯ βπ΄) π (π1β² )3 . π π=0 π₯ π β π π π 2 π=0 (π₯ π βπ₯ +π₯ βπ΄) π π π=0 π΄ π =π₯β ππ΄ π . π π β² 4 π=0(π 1 ) = π4β² β 4 π3β² π1β² + 6π2β² (π1β² )2 β 4π1β² (π1β² )3 + = β΄ π4 = π(π 1β² )3 π 4 π=0 (π₯ π βπ΄βπ₯ +π΄) π π 4 { π=0 π₯ π βπ΄ β(π₯ βπ΄)} = = = π π₯ βπ΄ 2 β ππ=0 π₯ βπ΄ 3 π π=0 π₯ π βπ΄ +3 π β² 3 π=0(π 1 ) = π3β² β 3 π2β² π1β² + 3π1β² (π1β² )2 β = π3β² β 3 π2β² π1β² + 3(π1β² )3 β π π=0 π₯ π βπ΄ π β4 π . . . π 1 π=0(π₯ π βπ΄) π π=0 π₯ π =π₯β π 3 π=0(π₯ π βπ₯ ) π π π π=0 π₯ π β π=0 π₯ = π π 2 π=0 (π₯ π βπ΄) π β = = = = = π = π₯ β π₯ = 0. π 4 π=0 (π₯ π βπ₯ ) π4 = . π π(π₯ βπ΄) π = π3β² β 3 π2β² π1β² + 3(π1β² )3 β = π3β² β 3 π2β² π1β² + 2(π1β² )3 . . β¦ . π π + π 4 π=0(π₯ βπ΄) π . β π .

34 | p a g e Department of Finance. π(π₯ βπ΄)3 π + π 4 π=0 (π₯ βπ΄) π . π₯π β π₯ = 0] π π 4 π=0{ π₯ π βπ₯ +(π₯ βπ΄)} π π 2 π₯ βπ΄ 2 +4 π=0 π₯ π βπ₯ π . Skewness Skewness: Skewness is the degree of asymmetry or departure from symmetry. of a distribution. +3 π 4 π=0(π₯ π βπ₯ +π₯ βπ΄) π 3 π₯ βπ΄ +6 π=0 π₯ π βπ₯ π 3 π=0 π₯ π βπ₯ . =π4 + 4π3 π + 6π2 π 2 + 0 + [ π₯π β π₯ = 0] π 2 4 =π4 + 4π3 π + 6π2 π + π . If the frequency-curve (smoothed frequency polygon) of a distribution has a longer tail to the right of central maximum than to the left.β΄3rd raw moments π3β² = π 3 π=0(π₯ π βπ΄) π = = = = π 3 π=0(π₯ π βπ₯ +π₯ βπ΄) π π 3 π=0{ π₯ π βπ₯ +(π₯ βπ΄)} π π 3 π=0(π₯ π βπ₯ ) +3 π 3 π=0(π₯ π βπ₯ ) π +3 π 2 π=0 π₯ π βπ₯ (π₯ βπ΄)+3 π 2 π=0 π₯ π βπ₯ π =π3 + 3π2 π + 3 Γ 0 Γ π =π3 + 3π2 π + (π)3 . it is said to be skewed to the left or to have negative skewness. π π 2 3 π=0 π₯ π βπ₯ (π₯ βπ΄) + π=0(π₯ βπ΄) π(π₯ βπ΄) +6 π π(π)4 π 2 π=0 π₯ π βπ₯ π . π π=0 π₯ π βπ₯ π(π₯ βπ΄)2 π π₯ βπ΄ 3 + ππ=0 π₯ βπ΄ 4 +4 π π=0 π₯ π βπ₯ π π π=0 . Note: The formula is used for this moment: (π + π)4 = π4 + 4π3 π + 6π2 π2 + 4ππ3 + π4 Md. [ π π=0 . Positive skewed distribution: In the positive skewed distribution. β΄ 4th raw moments π4β² = π 4 π=0(π₯ π βπ΄) π = = π 4 π=0 π₯ π βπ₯ +4 = = π 4 π=0(π₯ π βπ₯ ) π +4 π π π(π₯ βπ΄) 2 π + π(π)3 π π π=0 π₯ π βπ₯ π . Department of Finance. 3rd Batch. Negative skewed distribution: In a negative skewed distribution the value of mode is maximum and that of mean least the median lies in between the two. Jagannath University. the distribution is said to be skewed to the right or to have positive skewness. . the value of the mean is maximum and that of mode least the median lies in between the two as is clear from the following diagram. Jagannath University JONY . Roll no: 091541. Mazharul Islam (Jony). π(π₯ βπ΄)2 π + π 3 π=0(π₯ βπ΄) π . If the reverse is true.

Sk = ππππ βππππ ππ‘ππππππ π·ππ£πππ‘πππ = π₯ βππ ππ· . when skewness is absent. Thus the formula for the pearsonian coefficient of skewness is.Symmetrical distribution: In a symmetrical distribution the values of mean. in case of a symmetrical distribution. ο If Mean > Mode. Skewness is present if: ο The values of mean. ο When the data are plotted on a graph they do not give normal bell-shaped form. ο Frequencies are equally distributed at points of equal deviation from the mode. the distribution is said to be positively skewed.e. Pearsonian coefficient of skewness: To get the pearsonian coefficient of skewness.e. (i.) ο The sum of the positive deviations from the median is not equal to the sum of the negative deviations. we divide the difference between the mean and the mode by standard deviation. Conversely stated. Asymmetrical distribution: A distribution which is not symmetrical is called a skewed distribution and such a distribution could either be skewed or negatively skewed. median and mode coincide. ο Quartiles are not equidistant from the median. ο Quartiles are equidistant from the median. (i. 35 | p a g e Department of Finance. Jagannath University JONY . Here. Symmetrical π΄π = ππ = ππ Negatively Skewed π΄π < ππ < ππ Positively Skewed π΄π > ππ > ππ Tests of skewness: In order to ascertain whether a distribution is skewed or not. ο Frequencies are not equally distributed at points of equal deviation from the mode. the following tests may be applied. (i. ο When the data are plotted on a graph they give normal bell-shaped form.) ο The sum of the positive deviations from the median is equal to the sum of the negative deviations. When cut along a vertical line through the center the two halves are not equal. median and mode coincide. When cut along a vertical line through the center the two halves are equal. the following condition are satisfied: ο The values of mean.e. median and mode do not coincide.

Sk = 3(ππππ βππππππ ) ππ‘ππππππ π·ππ£πππ‘πππ = 3(π₯ βππ ) ππ· . or π½1 = π3 3 π 22 = π3 π3 . Jagannath University JONY . ο If Ξ²1 > 0 or ΞΌ3 > 0 then the curve is positively skewed which indicates that the right tail of a frequency curve is longer than the left tail. it is called leptokurtic. If SD = 10. The concept of kurtosis is rarely used in elementary statistical analysis. it is called platykurtic. Mesokurtic: The normal curve itself is known as mesokurtic. To avoid using the mode. the distribution is negative skewed.A. Leptokurtic: If a curve is more peaked than the normal curve. Can be positive or negative [Where π3 πππ π2 are the 3rd and 2nd central / corrected moments] Also we can say that. is always positive. Note: Karl Pearson introduced the concept of Beta coefficients which are known as pearsonian coefficients and Gamma notations were introduced by R. ο If Ξ²1 < 0 or ΞΌ3 < 0 then the curve is negatively skewed which means that the curve has an elongated left tail. where mean median and mode coincide. Kurtosis Kurtosis: Kurtosis is the degree of peakness or flatness of a distribution usually taken relative to a normal distribution. the distribution is said to be symmetrical. the distribution is said to be negatively skewed. Sk = ππππ βππππ ππ‘ππππππ π·ππ£πππ‘πππ = 120β123 10 = β3 10 = β0.ο If Mean < Mode. ο If Mean = Mode. Fisher.3 Comment: Since Sk < 0. Example: The arithmetic mean and mode of a distribution are 120 and 123. Coefficients of skewness based on moments are Beta coefficient and Gamma coefficient. The condition of peakness or flatness itself is known as kurtosis of excess. Solution: Pearsonβs coefficient of skewness. Their relation with each is given below- π½1 = π32 π2 3 . Platykurtic: If a curve is more flat-topped than the normal curve. The following diagram illustrates the shape of three different curves mentioned below: 36 | p a g e Department of Finance. ο If Ξ²1 = 0 or ΞΌ3 = 0 then the distribution is symmetrical. we can employ the empirical formula. find Pearsonβs coefficient of skewness and hence comment. πΎ1 = π½1 Here.

π4 = 6 . ο If πΎ2 = 0.7.15 that is π½1 > 0 and π½2 > 3 . then the distribution is mesokurtic. then the distribution is leptokurtic.7 π2 (2.03136 And π½2 = π4 18. Example2: For a distribution we have π2 = 3.25 =0 And π½2 = π4 π2 2 = 6 (1.25 = 2 = 2 = 2.25 = 2. π3 = 0. π2 Here.5. π4 = 30 . So the distribution is slightly positively skewed and kurtosis is mesokurtic. ο If π½2 > 3. Find π½1 and π½2 and hence comment on the shape of the distribution.7)2 π2 (2. π4 = 18. then the distribution is mesokurtic.99 β 3 Comment: Since π3 = 0.625 = 0.5)3 = 3 = 0. ο If πΎ2 > 0.5)3 = 3 37 | p a g e = 0 2. π3 = β2. ο If π½2 = 3. Jagannath University JONY .67 Department of Finance.7 18. then the distribution is platykurtic.7 . the derivative of π½2 .Mesokurtic π½2 = 3 Platykurtic π½2 < 3 Leptokurtic π½2 > 3 Measures of Kurtosis: The most important Kurtosis is based on 2nd and 4th central moments is defined by π½2 and is denoted as. ο If π½2 < 3. πΎ2 ππ πππππππ ππ : πΎ2 = π½2 β 3 Then. Solution: π½1 = π 32 (β2)2 π2 (3)3 = 3 = 4 27 = 0. Sometimes πΎ2 . then the distribution is platykurtic.5) 6.5)2 = 6 2. So the distribution is slightly positively skewed and kurtosis is leptokurtic. Find π½1 and π½2 and hence comment on the shape of the distribution. is used as a measure of kurtosis. Example3: For a distribution we have π2 = 1. then the distribution is leptokurtic. ο If πΎ2 < 0.49 15. Solution: π½1 = π 32 (0. π π½2 = 42 . π3 = 0.33 Comment: Since π½1 = 0.15 And π½2 = π4 π2 2 = 30 (3)2 = 30 9 = 3.5. Solution: π½1 = π 32 (0)2 π2 (1. Example1: For a distribution we have π2 = 2.7 and π½2 = 3. Find π½1 and π½2 and hence comment on the shape of the distribution.

π4β² = 50 and A = 5 We have.Comment: Since π3 = 0 or π½1 = 0 and π½2 < 3 . Correlation Correlation: Correlation analysis is the statistical tool. they are said correlation. 20. π1β² = 2. So the distribution is negatively skewed and kurtosis is platykurtic. So the distribution is symmetrical and kurtosis is platykurtic. Correlation means the linear relationship between two or more variables. Solution: Here.π½1 . Thus correlation analyzing refers to the techniques used in measuring the closeness of the relationship between variables. If the change in one effects a change in the other variable. we can use to describe the degree to which one variable is linearly related to another. for weight = 5 40 2 10 Γ 100 = 12.63 Comment: Since π3 < 0 and π½2 < 3 . Jagannath University JONY .5% Γ 100 = 20% Height is more consistent or less variability. Example5: We have the following information obtained from 150 children in a community. π½2 . π1β² = π₯ β π΄ π₯ = π1β² + π΄ = 2+5 = 7 β΄ Mean = 7 β΄ Variance π2 = π2β² β π1β² 2 = 20 β (2)2 = 20 β 4 = 1 β΄ π3 = π3β² β 3 π2β² π1β² + 2(π1β² )3 = 40 β 3Γ20Γ2 + 2Γ (2)3 = 40 β 120+ 16 = β64 β΄ π4 = π4β² β 4 π3β² π1β² + 6π2β² (π1β² )2 β 3(π1β² )4 = 50 β 4Γ40Γ2 +6Γ20Γ (2)2 β3Γ (2)4 = 50β320 + 480 β48 = 162 π½1 = π 32 (β64)2 π2 (16)3 4096 π4 162 162 = 3 And π½2 = π 22 = = 4096 (16)2 = =0 256 = 0.V.V. Example 4: The first 4 moments of a distribution about the value to 5 of the variable are 2. π3β² = 40. Height(inch) Weight(kg) 40 10 Mean ( π₯ ) SD 5 2 Which characteristics height or weight is more consistent (less variability) Solution: C. Find mean. π2β² = 20. and hence comment on the shape of the distribution. 40 and 50. variance. for height = C. 38 | p a g e Department of Finance.

that. ο If there is no relationship indicated between the variables. they are uncorrelated) Positive linear correlelation 39 | p a g e Negative linear coccrlation No correlation Department of Finance. ο If y tends to decrease as x increase. Linear correlation: If x and y denote the two variables under consideration a scatter diagram shows the location of points (x. Limits of the coefficient of correlation: In Pearsonβs formula. Jagannath University JONY .Whenever two variables are so related that a change in the value of one is accompanied by a change in the value of the other. ο If y tends to increase as x increases. the correlation is called positive or direct correlation. a) An increase in the one is accompanied by an increase or decrease in the other. the correlation is called nonlinear correlation. Karl Pearsonβs coefficient of correlation. Spearmanβs Rank coefficient of correlation. ο If all points seem to lie near some curve. Methods of studying correlation: The following are the important methods of ascertaining whether two variables are correlated or not. 1.(i. 3. It is clear that nonlinear correlation can be sometimes positive and sometimes negative. Thus perfect positive correlation is represented by (+)1 and perfect negative correlation is represented by (β)1. we can say that there is no correlation between them. Or b) A decrease in the one is accompanied by a decrease or increase in the other. If all points in this scatter diagram seem to lie near the correlation is called linear. the correlation is called negative or inverse correlation. no correlation means r = 0 and perfect correlation means r =1.y) on a rectangular coordinate system. 2.e. Then the variables are said to be correlated. Perfect correlation can be positive or negative. Here the coefficient of correlation βrβ is an abstract number or a pure number which measures the degree of the relationship between two variables. Scatter diagram method. in such a way.

3.linear Correlation: If the amount of change in one variable with the corresponding change of the other is not changed by any constant ratio. 2. Scatter Diagram/ Dot Diagram: Scatter diagram. π. β¦ β¦ .Non. π¦π ).hours of students twice then the result would never progress by the same rate. the diagrams of dots obtained is known as scatter diagram (dot diagram) Perfect Positive correlation High degree of Positive correlation Perfect Negative correlation High degree of Negative correlation No correlation Low degree of Positive correlation Low degree of Negative correlation From the scatter diagram. we can form a fairly good idea whether the variables are correlated or not. The term scatter refers to the dispersion of the dots on the graph. then we can say the correlation non-linear or curvilinear. If the values of the variables π₯ πππ π¦ be plotted along the π₯-axis and π¦axis respectively in the π₯π¦ plane. If the points are very dense or very close then we can say that strong or high correlation 40 | p a g e Department of Finance. Jagannath University JONY . Example: If we increase the study. Thus for the bivariate distribution (π₯π . The simplest device for ascertaining whether two variables are related is to prepare a dot chart called scatter diagram. It is the absolute way of the diagrammatic presentation of bivariate data. the first step in correlation analysis is to visualize the relationship. π = 1.

the Karl Pearsonβs method. is widely used in practice. Merits and limitation of the Scatter diagram: Merits: ο This method is very easy and simple as it is non-mathematical method of studying correlation between the variables. Karl Pearsonβs coefficient of correlation: Of the several mathematical methods of measuring correlation. ο It is not influenced by the size of extreme items. ο When r = β1: It means that there exists a perfect negative correlation between two variables. if the correlation between two variables is zero. But its converse not true. But the exact degree of correlation cannot be obtained from it. The coefficient of correlation is denoted by the symbol βrβ .between the variables. (i. Thus +0. Hence it is clear that the coefficient of correlation can never be greater than (+) 1 and less than (β)1. We normally get values which lies between +1 and β1 such as +0. To some extent. β1 and 0 are rare. Limitation: ο The scatter diagram only shows the type of correlation between the two variables. 41 | p a g e Department of Finance. ππ§πππ«π©π«πππ’π§π π¨π ππ¨ππππ’ππ’ππ§π π¨π ππ¨π«π«ππ₯πππ’π¨π§: The following general guideline are given which would help in interpreting the value βrβ. β0. such value βrβ as +1. But we shall see later that most of the mathematical methods of finding correlation lack this quality.8 would mean that correlation is positive because the sign of βrβ is positive and the magnitude of correlation is 0. Zero coefficient of correlation shows the absence of linear relationship between the two variables.8. Jagannath University JONY . To some extent the degree of correlation may also be guessed from it.) So the values between 1 and β1 are interpreted accordingly. The correlation between them is Zero.e.8. And if the points are cluster around a straight line then we can say that weak or low correlation between two variables. the following formula suggested by Pearson can be used for measuring the degree of relation. Note: In practice. The coefficient of correlation describes not only the magnitude of correlation but also its direction. ο Drawing a scatter diagram usually is the first step in investigating the relationship between two variables. ο When r = +1: It means that there exists a perfect positive correlation between two variables.4 etc. r= π₯βπ₯ (π¦βπ¦ ) π₯βπ₯ 2 (π¦βπ¦ )2 π₯π¦ β = π₯2β π₯ 2 π π₯ π¦ π π¦ 2β π¦ 2 π . ο When r = 0: It means that two variables are independent. If the two variables are π₯ πππ π¦. the degree of correlation may also be guessed from it. popularly known as Pearsonian coefficient of correlation. they are not necessarily independent.

Values of r Comments r = +1 Perfect Positive correlation Perfect Negative correlation r = β1 Higher degree of Positive correlation r> 0. If π₯ πππ π¦ are independent variables then coefficient of correlation is zero.8 Moderate degree of Negative correlation β.00 β0. However the converse is not true.50 Negative correlation 42 | p a g e Perfect Positive correlation No correlation 0 Strong positive correlation 0.05 1. r: 1.2 < π < 0 r=0 No correlation The following drawing summarizes the strength and direction of the coefficient of correlation.Properties of the coefficient of correlation: The followings are the important properties of the coefficient of correlation. Limitation: 1.8 Moderate degree of Positive correlation 0.2 < π < 0. 3.2 Low degree of Negative correlation β0.2 Low degree of Positive correlation 0 < π < 0.8 Higher degree of Negative correlation r< β0. To determine the coefficient of correlation β²πβ² we have to assume that there is a linear relationship or not non-linear relationship. 2. Symbolically: π = ππ₯π¦ Γ ππ¦π₯ 5.08 < π < β0. 3. Comments on coefficient of correlation (r): The following chart shows approximately. Jagannath University JONY . The coefficient of correlation is independent of change of origin and scale. It is valid when we have a random sample from a bivariate normal distribution. If the sample size is small then it does not give us a better result to determine the relation. The coefficient of correlation is the geometric mean of two regression coefficients. It gives the degree of concomitant movement or variation between two variables. The coefficient of correlation lies between β1and +1. Symbolically: β1 β€ π β€ 1 or π β€ 1 2.00 Positive correlation Department of Finance. Symbolically: ππ₯π¦ = ππ¦π₯ 4. Perfect Negative correlation Moderate positive correlation Moderate negative correlation Weak Weak negative positive correlation correlation Strong negative correlation β1.

π¦ π₯π¦ 30 600 35 770 40 960 50 1300 60 1680 60 1800 55 1760 π¦ =330 π₯π¦=8870 π₯2 400 484 576 676 784 900 1024 π₯ 2 =4844 π¦2 900 1225 1600 2500 3600 3600 3025 2 π¦ = 16450 Department of Finance. Example: If π = 0. It is an easier and more useful measure than the coefficient of correlation β²πβ² Example: Following figures give the rainfall in inches for the year and the production in 00βs of kgs. For the Rabi crop and Kharif crop. we can say that. Jagannath University JONY .64. It is usually denoted by β²π 2 β². It is expressed the proportion of the total variation of the dependent variable has been explained by the independent variable. Calculate the Karl Pearsonβs coefficient of correlation between rainfall and total production. Rainfall 20 22 24 26 28 30 32 Rabi Production 15 18 20 32 40 39 40 Kharif Production 15 17 20 18 20 21 15 Solution: Let rainfall be denoted by π₯ 20 22 24 26 28 30 32 π₯ = 182 43 | p a g e β²π₯β² and production by β²π¦β². which indicates that 64% of the total variation in the dependent variable has been explained by the independent variable. b= (π¦ βπ¦ )2 (π¦βπ¦ ) (π¦ βπ¦ )2 (π + π)2 = π2 + 2 ππ + π2 = 1 + 2r +1 = 2(1+r) β₯ 0 or 1+rβ₯ 0 β¦β¦(i) 2 Similarly. β1 β€ π β€ 1 (proven) Then. a= π₯βπ₯ (π¦βπ¦ ) π₯βπ₯ 2 π₯βπ₯ π₯βπ₯ 2 . (π β π) = π2 β 2 ππ + π2 = 1 β 2r +1 = 2(1βr) β₯ 0 or 1βrβ₯ 0 β¦β¦(ii) From (i) and (ii). Coefficient of Determination: The coefficient of determination is the square term of coefficient of correlation β²πβ².8 π‘πππ π 2 = 0.Proof: β1 β€ π β€ 1 If the coefficient if correlation is r. then r= Let.

Example: Here is given the following data on x and y.17 6.17 411β368.83 = = 0.17 40. 44 | p a g e Department of Finance. Jagannath University JONY .54 = 44. Regression Regression Analysis: Regression analysis is concerned with the study of dependence of one variable (dependent variable) on one or more other variable (independent variables) for estimating the average value of the dependent variable in terms of the known values of the dependent variable.π₯π¦ β β΄ r= π₯2β π₯ π¦ π π₯ 2 π π¦ 2β 8870 β = π¦ 2 π 182Γ330 7 (182)2 7 (330)2 7 4844β = 8870β8580 112 892.89 Interpretation: There exists a strong positive linear relation between x and y.86 = 16450β 290 10. 3 5 6 8 10 11 π₯ 5 6 5 9 12 10 π¦ Calculate the coefficient of correlation.917 Comment: It is a case of very high degree of positive correlation between Rainfall and Agricultural production.17 46.1304 = 0. Solution: π₯ π¦ π₯π¦ π₯2 π¦2 3 5 15 9 25 5 6 30 25 36 6 5 30 36 25 8 9 72 64 81 10 12 120 100 144 11 10 110 121 100 2 π₯ =355 π¦ 2 =411 π₯ = 43 π¦ = 47 π₯π¦ = 377 π₯π¦ β β΄ r= π₯2β π₯ 2 π π₯ π¦ π π¦ 2β π¦ 2 π = 377 β 43Γ47 6 (43)2 6 355β = = (47)2 6 411β 377β336.7336 = 40.88 = 290 316.58Γ29.84Γ6.17 40.83 355β308.83 42. Simple Regression Analysis: The term simple regression analysis indicates that the value of a dependent variable is estimated on the basis of one independent variable.

Jagannath University JONY . π₯ = Independent variable. π¦ = Values of the dependent variable. The first formula calculates the slope. Y-intercept of the best fitting regression line: a = π¦ β ππ₯ or π¦ π β π π₯ π Here. Here a and b are called least squares estimates. n = Number of data points (that is. π₯ = Mean of the values of the independent variable. π¦ = Dependent variable. b = Slope of the best fitting estimating line. a = Y-intercept. Slope of the best fitting regression line: π= π₯ π¦ π π₯ 2 2 π₯ β π π₯π¦ β Here. π₯ = Values of the independent variable. 45 | p a g e Department of Finance. = π2 ππ₯π¦ Γ ππ¦π₯ = π Regression Equation: Statisticians have derived two equations. the number of pairs of values for the independent and dependent variables). ππ₯π¦ = π ππ₯ ππ¦ .Properties of the Regression Coefficient: 1. b = slope of the line. we can find the best fitting regression line for any two variable set of data point. b = Slope from equation. The second formula calculates the Y-intercept of the line whose slope we calculated using equation. we can use to find the slope and Y-intercept of the best fitting regression line. π¦ = π + ππ₯ Here. π¦ = Mean of the values of the dependent variable. With this two equations. a = y-intercept. The equation for a fitted or straight regression line where the dependent variable y is determine by the independent variable π₯ is. ππ¦π₯ = π β΄ ππ₯π¦ Γ ππ¦π₯ = π β΄ ππ₯ ππ¦ Γ π ππ¦ ππ₯ ππ¦ ππ₯ . The coefficient of correlation is the geometric mean of the two regression coefficients symbolically: π = ππ₯π¦ Γ ππ¦π₯ Proof: we know that.

13) 2nd point 1st point (2. The a is called the y-intercept because its value is the point at which the regression line crosses the y axis that is the vertical axis. Now with the numerical values of a and b determined.5) 2 3 4 5 β΄ The slope of a straight line: π¦2 β π¦1 7β5 2 = = =2 π₯2 β π₯1 2β1 1 Thus the relationship between the variables is direct and the slope is positive. Solution: We know that. If we refer to the line in graph we can see that point (5. we can substitute in the general equation for a straight line. Therefore we know a = 6. Find slope.Using this equation we can take a given value of x and compute the value of y. π¦ = π + ππ₯ = 3 + 2(5) = 3 + 10 = 13 [Value for y given x = 5] Example: If it crossed the y-axis at 3.5) and π₯2 . Therefore we know a = 6If a =3 and b = 2 then what y would be for an x = 5. their values do not change. π¦ = π + ππ₯ = 3 + 2π₯ Assume that we wish to find the value of dependent variable that corresponds to x = 5 substituting into equation.7) . y must equal to 13. π¦ = 3 + 2(5) = 3 + 2 Γ 5 = 13 Thus when x = 5. And ο If y depends on y then x is independent and y is dependent. π¦1 = (1. 13) does on the line. Both a and b are numerical constants because for any given straight line. The b in equation is the slope of the line. It represents how much each unit change of the independent variable x changes the dependent variable y. π¦2 = (2. Example: If it crossed the y-axis at 3. π= 46 | p a g e Department of Finance.3) 0 1 The point (5.7) (1. Note: ο If x depends on y then y is independent and x is dependent. Jagannath University JONY . Solution: a=3 14 12 10 8 6 4 2 0 The point (0. If we select the two point where π₯1 .

means if the store employs a person without any experience (i. Also b = 4. Solution: We know. a = 80. 4 thousand. Jagannath University JONY . the least squares estimates are. then the average sales value will be Tk. 80 thousand. π₯ = 0).intercept or a = π¦ π β π π₯ π Calculation: Experience(x) 1 3 4 4 6 8 10 10 11 13 π₯ = 70 β΄b= β΄a= 8128β 70Γ1080 10 (70)2 632β 1080 10 = 10 β 4Γ 70 10 8128β7560 632β490 = Sales(y) 80 97 92 102 103 111 119 123 117 136 π¦ = 1080 568 142 π₯2 1 9 16 16 36 64 100 100 121 169 π₯ 2 = 632 π₯π¦ 80 291 368 408 618 888 1190 1230 1287 1768 π₯π¦ = 8128 =4 = 108 β 28 = 80 Therefore.Example: A departmental store has the following statistics of sales for a period of last one year of 10 salesman.e.intercept and b). 47 | p a g e Department of Finance. ο Interpret the estimated coefficient (a or y. ο Predict the annual sales volume of personβs who have 12 and 15 years of experience. Prediction: π¦ = 80 + 4π₯ β΄The annual sales volume for 12 years of experience = 80 + 4 Γ 12 = 128. the sales volume would increase on the average by Tk. β΄The annual sales volume for 12 years of experience = 80 + 4 Γ 15 = 150. who have varying of experience. Years of Experience: 1 3 4 4 6 8 10 10 11 13 Annual Sales: 80 97 92 102 103 111 119 123 117 136 ο Fit a regression line of annual sales on years of experience. means that for average increase of one year sales experience of a person. the fitted regression line of y on x is: π¦ = π + ππ₯ = 80 + 4π₯ Interpretation of the estimated coefficient (a and b): Here. b= π₯ π¦ π π₯ 2 2 π₯ β π π₯π¦ β and y.

the line represent an inverse relationship and the slope is negative ( y decrease as x increase). Now with the numerical values of a and b determined. Jagannath University JONY . There are various approaches to define probability.6) 6 a=6 2nd point The (1. Jagannath University.0) 0 β΄ The slope of a straight line: 0 1 2 3 4 5 6 π¦2 β π¦1 3 β 6 β3 = = = β3 π₯2 β π₯1 1β0 1 When b is negative. In other words. Probability Probability Probability or a tendency βuncertaintyβ or βchanceβ refers to the probable movements or to occurring an event.3)point 4 2 (2. If we refer to the line in graph we can see that point (2. π¦1 = (0.Example: If it crosses the Y axis at 6. Therefore we know a = 6. Find slope. π¦ = 6 + β3 (2) =6β6=0 Thus when x = 2. Department of Finance. Mazharul Islam (Jony).3) . π¦ = π + ππ₯ = 6 + β3 π₯ = 6 β 3π₯ Assume that we wish to find the value of dependent variable that corresponds to x = 2 substituting into equation. 3rd Batch. π= Md. The principal approaches are as follows: 48 | p a g e Department of Finance. we can substitute in the general equation for a straight line. y must equal to 0.6) and π₯2 . inclusive. Solution: 8 1st Point (0. A numerical measure of certainty or uncertainty of event of en experiment is called probability. Roll no: 091541. describing the relative possibility or chance an event will occur. Its value lies between zero (0) and one (1). π¦2 = (1. If we select the two point where π₯1 . 0) does on the line.

Because this approach permits determination of probability values before any sample events are observed. 6 are possible outcome. II. The number of road accidents per day in Dhaka City. Relative Frequency Approach: The relative frequency approach. This means that trial is a special case of experiment. C etc. 4. 2. Example: Throwing a die is a trial (unit experiment) and 1. B. The probability of an event.ππ πππ πππ£ππ‘πππ ππ π΄ P(A) = πππ‘ππ ππ’ππππ ππ ππ’π‘πππππ = π(π΄) π(π) . The probability that event A will occur by the relative frequency approach is. the probability is determined on the basis of the proportion of times that is a favorable occurs in a number of observations or experiments. Unit experiment: Unit experiment is known as trial.ππ πππ πππ£ππ‘πππ ππ π΄ ππππππ π ππ§π = π(π΄) π . P(A) = ππ. ππ . to have two dots is a simple event. Because determination of the probability values is based on observation and collection of data. But all possible outcomes should be known in advance. It is thus an event which cannot be further subdivided into a combination of other events. Jagannath University JONY . Tossing a fair coin or throwing a die and observe what the top shows. 49 | p a g e Department of Finance. Simple event: An elementary event or a simple event is a single possible outcome of an experiment. 5. this approach has also been called the empirical approach. Events are generally denoted by A. Example: In case of rolling a die. Outcome: The results of an experiment are known as outcome. 3. Events: An event is a possible outcome of an experiment or a result of a trial or an observation . Experiment: Experiment is an act that can be repeated under given conditions. Random experiment: A random experiment is an experiment that can be repeated any number of times under some identical conditions. B. it has also been called priori approach. No prior assumption of equal likelihood is involved. usually the exact result of the experiment canβt be predicted with certainty. In any random experiment the outcome of any particular trial should not be known beforehand.A. Experiment may be a trial or two or more trials. Classical or Mathematical or Priori Approach: The classical approach to probability is based on the assumption that each outcome is equally likely and exhaustive. Example: I.

Example: If we toss a coin and if βHβ stand for a head and βTβ stand for tail. Collectively exhaustive events: Collective exhaustive events are those which include all possible outcomes. 1. A B Venn diagram of disjoint sets Non-Exclusive events: Two or more events are non-exclusive when it is possible for them to occur together.Compound events: When two or more events occur in connection with each other. Two events A and B are said to be mutually exhaustive if they cannot happen or occur together. That is π΄ β© π΅ β 0. Jagannath University JONY . then the sample point is H and T and for die. Sample space: The set or collection of all possible outcomes of a random experiment is known as sample space. Mutually exhaustive events: If the happening of any of the events excludes the happening of all the other then the events would be termed as mutually exclusive events or disjoint. 2. The compound event is an aggregate of simple events. in case of throwing a die. π} and for die. If π΄ βͺ π΅ = π (π πππππ π ππππ).6 is known as sample point. then the sample space βSβ for the possible experimental outcomes may be written as. π = {π». 4. 2. Every event is a subset of the sample space. Example: The number of all possible outcomes. 5 and 6 create a collective exhaustive event. The probability of impossible event is Zero. It is usually denoted by capital letter. Sample point: Each and every possible outcome in a sample space is called sample point. 4. then we can say that the events A and B are collective exhaustive events. Example: To die for every living is a certain event. 50 | p a g e Department of Finance. 3. Example: To live without breathing is an impossible event. 3. 4. each of 1. Example: If we toss a coin and if βHβ stand for a head and βTβ stand for tail. 5. 3. 6}. Example: If a single coin is tossed either head can be up or tail can be up. 2. S={1. then their simultaneous occurrence is called a compound event. 5. both cannot be up at the same time. Impossible events: An event whose occurrence is quietly impossible in a random experiment is called an impossible event.

Clearly the events A and π΄ are mutually exclusive and collectively exhaustive. οΌ P(A and B)/ P(Aβ©B) = P(A) Γ P(B) or P(AB) Conditional probability: When two events are dependent. the concept of conditional probability is employed to designate the probability of occurrence of the related event. And the probability is π π΄ βͺ π΄ = π π =1 and π π΄ β© π΄ = π β =0.Complementary events: The complement of an event implies the non-occurrence of the event. Jagannath University JONY . An event A and the event π΄ consisting of all points of the sample space not in A. If A and B are two events. Then π΄ βͺ π΄ = π and π΄ β© π΄ = β . Additive law: Let A and B are two events then the occurrence of either A or B is. 51 | p a g e Department of Finance. π¨ A Laws of Probability: There are many situations in where the problems related with probability are not so simple. a. Example: Here π΄ is the complement of A. the probability that A occurs given that B has already occurred is denoted by π π΄/π΅ and is called the probability of A given B. οΌ P(A or B)/ P(AβͺB) = P(A) +P(B) [when both events are mutually exclusive] A B Venn diagram: P(AβͺB) = P(A) +P(B) οΌ P(A or B)/ P(AβͺB) = P(A) +P(B) βP(A and B)/ P(Aβ©B) = P(A) +P(B) βP(AB) [when both events are not mutually exclusive] A B π¨β©π© Venn diagram: P(AβͺB) = P(A) +P(B) βP(Aβ©B) b. Multiplicative law: Let A and B are two independent events. To deal with such a situation we have to know some important laws of probability. we define. are called complementary events. π(π΅ β© π΄) π π΄/π΅ = π(π΅) Therefore the condition probability of B given A is. then the occurrence of both A and B successively is.

6}. 3. B:{A number greater than 3} Solution: Hence the sample space is. 2. HT. β΄ Calculation of probability: 52 | p a g e H HH TH B = {HT. = = . 6. 4. TH}. π π΅/π΄ = Independent events: Two events are independent when the occurrence or non-occurrence of one event has no effect on the probability of occurrence of the other event. D={Two heads or Two tails}. Solution: The sample space is shown below. TT}. A: {Odd number}. Let us define an event A and B such that. 2. The expression π π΄/π΅ indicates the probability of event A occurring given that event B has occurred. π π΅ β© π΄ = π π΅/π΄ π(π΄). 6} β΄ P(B) = π(π΄) π(π) π(π΅) π(π) 3 1 6 3 2 1 6 2 = = . Example: Two events A and B are said to be dependent if and only if π π΄ β© π΅ = π π΄/π΅ π(π΅) Which implies that. Hence find the probabilities of these events and define the following two events and its probabilities: π΄ β© π΅ and π΄ βͺ π΅. 5} β΄ P(A) = β΄ B = {4. H T β΄ S = {HH. TT} β΄ Events: A = {HH.π(π΄ β© π΅) π(π΄) The expression π π΅/π΄ indicates the probability of event B occurring given that event A has occurred. Example: Suppose that a die is tossed once. 3. Department of Finance. There are six possible outcomes -1. HT. 2. TH}. D = {HH. Jagannath University JONY . 5. Example: A coin is tossed two times or two coins are tossed once and the squares of head s and tails recorded. Set up the sample space and define the following events. 4. B= {One tail}. β΄ A = {1. Ans. T HT TT C = {HH}. S ={1. A= {At least one head}. And here π΅/π΄ and π΄/π΅ are not fraction. 5. Example: Two events A and B are said to be independent if and only if π π΄ β© π΅ = π π΄ π(π΅) Dependent events: Two events are dependent when the occurrence or non-occurrence of one event does affect the probability of occurrence of the other event. C= {Two heads}. Ans. 5. TH.

P(B) . Are these events independent. TT} β΄ Events: A = {HH.π π΄ = π(π΄) π(π) 3 = . π΄ β© π΅ = {both coins will turn up heads}. π π΅ = 4 β΄ π΄ β© π΅ = {HT. Set up the sample space and define the following events.P(B) = Γ = 2 2 π(π΅) π(π) 2 1 4 2 = = . β΄ P(π΄ β© π΅) = = . H T H HH HT T TH TT β΄ S = {HH. β΄ π΄ = {no head appears} = {TT} β΄ π(π΄) = 53 | p a g e π(π΄) π(π) 3 = . π(π) π πΆ = 2 1 4 2 π(πΆ) π(π) 1 = . B = {HH. H T H HH TH T HT TT β΄ S = {HH. Jagannath University JONY . Solution: The sample space is shown below. P(A). P(π΄ β© π΅)= π(π) 1 1 π π΅ = = Also. β΄ π΄ β© π΅ = {HH} β΄ Calculation of probability: π π΄ = π(π΄) π(π) 2 1 4 2 n(π΄β©π΅) = = . 4 π π· = π(π·) π (π) 2 1 4 2 = = . TT} β΄ Events: A = {at least one head}. 4 Example: Two coins are tossed once. β΄ π(π΄ βͺ π΅) = π π΄ + π π΅ + π π΄ β© π΅ 3 1 1 4 2 2 = + β 3 = Ans. HT. that means this events are independent. 4 Department of Finance. B= {Head on the 2nd coin}. 1 4 1 4 Therefore we can say that. HT}. Complement of the event A is π΄. TH. Solution: The sample space is shown below. Example: A coin is tossed two times. HT. A = {HH. A= {Head on the 1st coin}. Construct he sample space and find the probability of the event A at least one head and also find complement of A and its probability. TH} π(π΅) 2 1 4 2 = = . HT}. P(π΄ β© π΅) = P(A). Here. TH. TH}.

1) (2.4) (2. (4.1) (6. B= {both die show the same number}. 1 = . β΄ π = {ππππ ππ πππ}.2) (6. A= {the sum of the two dice is six}.2) (3. Example: Two distinct dice are tossed together once and the numbers on their faces recorded describe the sample space and find the probabilities of the following events.6) (3.4).2) (2.1)} β΄π π΄ = B = {(1.3). Solution: Let us define R for red ball and W for white ball.5) (2. Ans. (4.5). (6.5).3) (6.4) (5. Md.4) (4.4) (3. (4.3) (4.2) (5.4) 5 (1. [ though 1 ball have already been taken so 15-1= 14] 7 β΄P(Rβ©W) = P(R). Department of Finance.2).1) (3. (5.3) (5.5) (5. (2. Roll no: 091541.3) 4 (1.1).6) (6.3 1 4 4 β΄ π(π΄) = 1 β π π΄ = 1 β = . β΄ π = {ππππ ππ π€πππ‘π} Here.6) β΄ Events: A = {(1.6) (5.4) (6. Find the probability that the 1st ball is read and 2nd ball is white.2). (5. P(W/R) 1 5 5 3 7 21 = Γ = . (2. (5.1) (4. Ans.3) (2.3). P(R) = 5 15 β΄P(W/R) = 1 = 3 10 14 5 = .5) (6.3)} β΄ π πΆ = π(π΄) π(π) π(π΅) π(π) π(πΆ) π(π) = = = 5 36 6 36 4 36 . 3rd Batch. Ans. Jagannath University JONY . (3.3) (3. (3.4). 2nd die 1 2 3 4 5 6 1 (1. Two ball are drawn at random from the bag without replacement.4). 6 1 = .1) (5. 9 Example: Suppose that a bag contains 10 white and 5 red balls.6).2) (4.1) 2 (1.5). Mazharul Islam (Jony).5) 6 (1.6)} β΄ π π΅ = C = {(3. Jagannath University. C= { the sum of the two dice is 9}. 54 | p a g e Department of Finance.5) (4.6) (2. Solution: The sample space is shown below.6) (4.2) 1st die 3 (1.5) (3. (6. Ans.

- Six-Sigma-Role.pdf
- Six-Sigma-History (1).pdf
- How to upgrade TP-LINK Wireless N Router.pdf
- Ticket Request and Quick Act
- PURCHASE ONLYSkill Matrix.
- PURCHASE ONLYMicro Economics
- PURCHASE ONLYPrinciples of Management.pdf
- PURCHASE ONLYFranchise
- PURCHASE ONLYStatistics II
- PURCHASE ONLYSamson H Chowdhury
- PURCHASE ONLYMacroeconomics
- PURCHASE ONLYFinancial Environment
- PURCHASE ONLYPrinciples of Marketing

Sign up to vote on this title

UsefulNot usefulStatistics is nothing but the combination of some error and error less estimations.

Statistics is nothing but the combination of some error and error less estimations.

- UT Dallas Syllabus for opre6301.mbc.07f taught by John Wiorkowski (wiorkow)by UT Dallas Provost's Technology Group
- UT Dallas Syllabus for opre6301.mbc 06f taught by John Wiorkowski (wiorkow)by UT Dallas Provost's Technology Group
- frb_2014comp.pdfby FRASER: Federal Reserve Archive
- Blood Lead Concentrations < 10 ΞΌg/dL and Child Intelligence at 6 Years of Ageby Environmental Health Perspectives

- UT Dallas Syllabus for opre6301.mbc.08f taught by John Wiorkowski (wiorkow)by UT Dallas Provost's Technology Group
- UT Dallas Syllabus for opre6301.pjm.07f taught by John Wiorkowski (wiorkow)by UT Dallas Provost's Technology Group
- UT Dallas Syllabus for opre6301.mbc.10f taught by John Wiorkowski (wiorkow)by UT Dallas Provost's Technology Group
- UT Dallas Syllabus for opre6301.mbc.11f taught by John Wiorkowski (wiorkow)by UT Dallas Provost's Technology Group

- Statistical Methods
- Macro Economics
- tmp4D5A
- Statistical Methods
- UT Dallas Syllabus for opre6301.mbc.09f taught by John Wiorkowski (wiorkow)
- Quantitative Methods for Economic
- Statistical Methods
- frb_2006comp_p1
- UT Dallas Syllabus for opre6301.mbc.07f taught by John Wiorkowski (wiorkow)
- UT Dallas Syllabus for opre6301.mbc 06f taught by John Wiorkowski (wiorkow)
- frb_2014comp.pdf
- Blood Lead Concentrations < 10 ΞΌg/dL and Child Intelligence at 6 Years of Age
- UT Dallas Syllabus for opre6301.mbc.08f taught by John Wiorkowski (wiorkow)
- UT Dallas Syllabus for opre6301.pjm.07f taught by John Wiorkowski (wiorkow)
- UT Dallas Syllabus for opre6301.mbc.10f taught by John Wiorkowski (wiorkow)
- UT Dallas Syllabus for opre6301.mbc.11f taught by John Wiorkowski (wiorkow)
- Business Statistics/Series-2-2005(Code3009)
- Fed Report Consumer Finances
- Coast Artillery Journal - Sep 1924
- Q1 2013 BPS Crime Statistics
- tmp1F9E
- 3368_1940-1944
- 4510_1945-1949
- 4135_1950-1954
- 62319_1995-1999
- 41449_1975-1979
- 41472_1975-1979
- 3726_1980-1984
- 41449_1980-1984
- 41451_1980-1984

Are you sure?

This action might not be possible to undo. Are you sure you want to continue?

We've moved you to where you read on your other device.

Get the full title to continue

Get the full title to continue reading from where you left off, or restart the preview.

scribd