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Contents

Chapter 1 What is Statistics?...............................................................3

1

2

3

Population vs. sample.....................................................................................3

Statistical inference........................................................................................3

4

5

6

7

Types of data..................................................................................................4

Describing univariate nominal data...............................................................4

Comparing multivariate nominal data...........................................................4

8

9

10

11

12

Describing time-series data...........................................................................5

Describing bivariate interval data..................................................................5

Graphical excellence......................................................................................5

Graphical deception.......................................................................................5

13

14

15

16

Variability.......................................................................................................7

Measures of relative standing........................................................................7

Measures of linear relationship......................................................................8

17

18

19

20

21

Sampling........................................................................................................9

Sampling plans...............................................................................................9

Sampling error...............................................................................................9

Nonsampling error.........................................................................................9

Chapter 6 Probability.........................................................................10

22

23

24

25

26

27

28

Random experiment.....................................................................................10

Sample space...............................................................................................10

Requirements of probabilities......................................................................10

Approaches to assigning probabilities.........................................................10

Events..........................................................................................................10

Joint, marginal and conditional probability..................................................10

Probability rules...........................................................................................10

29

Random variables........................................................................................12

30

31

32

Bivariate distributions..................................................................................12

Binomial distributions..................................................................................13

33

34

35

36

Uniform distributions....................................................................................14

Normal distributions.....................................................................................14

Exponential distribution...............................................................................14

37

Student

38

Chi-squared distribution...............................................................................15

39

distribution..............................................................................14

distribution..........................................................................................15

40

41

42

43

44

Sampling distribution of the sample mean..................................................16

Normal approximation of binomial distributions..........................................16

Approximating sampling distribution of a sample proportion.............................16

Sampling distribution of the difference between two means..........................17

45

46

Properties of estimators...............................................................................18

47

48

49

Sample size..................................................................................................18

( ) from median........................................18

1

Inferential statistics Drawing conclusions about populations based on

sample data

Population All items of interest to a statistics practitioner (e.g. the shoe size

of Australians)

Parameter A descriptive measure of a population (e.g. the mean shoe size

of Australians)

Sample A subset of a population (e.g. the shoe size of UNSW students)

Statistic A descriptive measure of a sample (e.g. the mean shoe size of

UNSW students)

Statistical inference

sample data

Confidence level The proportion of times an estimation procedure will

be correct

Significance level The proportion of times a conclusion will be wrong

4

sample (e.g. shoe size)

Values The possible observations of a variable (e.g. shoe sizes between

1-16)

Data (denoted as lowercase letters) The observed values of a variable

Types of data

Hierarchy of data

calculations.

Higher-level data can be treated as lower-level data, but not vice versa.

are valid)

2. Ordinal data Data in a ranked order (calculations based on order are

valid)

3. Nominal/qualitative/categorical data Arbitrary numbers (calculations

based on frequencies and percentages are valid)

Frequency

1. Frequency distribution1 - A table that shows the frequency of each

outcome

2. Bar chart A chart that shows the frequency of each outcome

Relative frequency

3. Relative frequency distribution A table that shows the relative frequency

of each outcome

4. Pie chart A chart that shows the relative frequency of each outcome

range], [Criteria]).

the frequency of combinations of two variables

2. Relative cross-classification table/cross-tabulation table A table

that shows the relative frequency of combinations of two variables

3. Separate bar charts

8

1. Histogram A chart with rectangles whose bases are the intervals and

whose heights are the frequencies

o

Class width=

Number of classes

o

o

o

o

o

Positively skewed With a tail to the right

Negatively skewed With a tail to the left

Unimodal With one peak

Bimodal With two peaks

3. Relative frequency distribution A table that shows the relative

frequency of values

4. Cumulative relative frequency distribution A table that cumulatively adds

relative frequencies

5. Ogive A chart that shows cumulative relative frequency

Scatter diagram A chart that plots the observed combinations of two

variables

Direction positive/negative

Strength strong/medium-strength/weak

11 Graphical excellence

1.

2.

3.

4.

5.

Concise data

Clear ideas

Multivariate

Substance over form

No distortion

12 Graphical deception

1.

2.

3.

4.

Graphs with different captions

Stretching and shrinking graphs

Bar charts with changing widths

13 Measures of central location

N

1.

xi

N

n

2.

3.

xi

n

Median=Middle observation=x n +1

2

4.

5.

Geometric mean=

( 1+ r)

r =1

14 Variability

1.

2. Variance

N

a.

( x i ) 2

b.

c.

( x ix )2

n1

1

Shortcut sample variance=s =

n1

2

2

i

x

i =1

( )

xi

i=1

3. Standard deviation

a.

b.

n

4.

|x ix|

5. Empirical rule

a. Within

one

standard

deviation

of

the

mean:

deviations

of

the

mean:

b. Within

two

standard

c. Within

three

standard

deviations

of

the

mean:

'

6.

7.

8.

1

[ for k >1 ]

k2

s

x

1.

2.

Interquartile range=Q3Q1

P

100

3. Box plots A graph with a box and whiskers that shows the maximum,

minimum, range, median, interquartile range and outliers.

4. Outliers Unusually large or small observations

1. Covariance

N

a.

( x i x )( y i y)

Population covariance= xy = i =1

n

b.

c.

( xi x )( y i y )

n1

1

Shortcut sample covariance=s xy =

n1

i=1

x i y i i=1

2. Coefficient of correlation

3.

4.

a.

b.

xi yi

i=1

xy

xy

s xy

sx sy

a.

b.

y intercept =b 1=

c.

Slope=b0 =y b1 x

s xy

s 2x

Y s variation is explained by

X s variation

a.

b.

10

17 Methods of collecting data

1. Primary data Collected by the statistics practitioners for the current

problem

2. Secondary data Collected by someone else for another problem

3. Observation Measuring actual behaviour

4. Experiments Imposing treatments and measuring resultant behaviour

5. Surveys Asking questions

18 Sampling

inferences

Sampled population The actual population from which the sample has

been take

Self-selected samples When participants choose to participate and

thus are more keenly interested in the issue than other members of the

population

19 Sampling plans

1. Simple random sample Samples with the same number of

observations are equally likely to be chosen

2. Stratified random sample Dividing the population into mutually

exclusive strata and then drawing simple random samples from each

stratum

3. Cluster sample Dividing the population into mutually exclusive clusters

and then only drawing simple random samples from selected clusters

20 Sampling error

because of observations that happened to be selected for the sample; it

can be reduced by increasing the sample size

21 Nonsampling error

Nonsampling error Differences between the sample and the population

because of mistakes in data acquisition or improper selection of sample

observations; it cannot be reduced by increasing the sample size

11

sensitive questions)

2. Nonresponse error When responses are not obtained from some

members of the sample

3. Selection bias When members of the target population cannot possibly

be selected for inclusion in the sample

12

Chapter 6 Probability

22 Random experiment

possible outcomes (e.g. Experiment: Flipping a coin. Outcomes: Heads or

tails.)

23 Sample space

mutually exclusive.

24 Requirements of probabilities

1. The probability of any outcome must lie between 0 and 1:

0 P ( Oi ) 1 [ for each i ]

k

P(Oi )=1

i=1

1. Classical approach Probabilities in games of chance (e.g. flipping a

coin, rolling dice)

2. Relative frequency approach Probabilities are long-run relative

frequencies

(e.g. if the relative frequency of getting a distinction is 200/1000 students,

P=20 ).

3. Subjective approach Probabilities are the degree of belief in the

occurrence of an event (e.g. the probability that the price of a share will

increase)

26 Events

mark of 80)

Event A collection or set of one or more simple events in a sample space

(e.g. the event of getting a distinction requires a mark of at least 80,

13

that make up an event

A

occur:

and

P( A B)

down columns

3. Conditional

P ( A|B )=

probability

The

probability

of

B :

given

P ( A B)

P (B )

4. Independent events

P ( A|B )=P ( A )

A

or

or both occur:

P ( A B)

28 Probability rules

1. Complement

rule:

The

probability

that

does

not

of

occur:

P ( A C )=1P( A)

2. Multiplication

rule:

The

joint

probability

and

3. Multiplication rule for independent events:

P ( A B ) =P ( A ) P(B)

4. Addition

of

rule:

The

union

and

B=P ( A B ) =P ( A )+ P ( B )P( A B)

5. Addition rule for mutually exclusive events:

14

P ( A B )=P ( A ) + P( B)

29 Random variables

outcome of an experiment (e.g. when flipping a coin, the number of heads

{ 0,1, 2, } )

finite or infinite)

Continuous random variable Can assume any values within a specified

range (e.g. time)

Probability distribution A table, formula or graph that shows the

probabilities of values of a random variable

1. Requirements of discrete probability distributions

a.

b.

2.

3.

4.

5.

0 P ( x ) 1

P ( x )=1

all x

allx

Population variance=V ( X )= 2= ( x )2 P ( x )

all x

all x

a.

E ( c )=c

b.

E ( X +c )=E ( X )+ c

c.

E ( cX )=cE ( X )

7. Laws of variance

a.

V ( c )=0

b.

V ( X +c )=V ( X )

c.

V ( cX )=c2 V ( X )

15

31 Bivariate distributions

1. Requirements for discrete bivariate distributions

a.

P ( x , y )=1

b.

2.

3.

4.

all x all y

Covariance=COV ( X , Y )= xy = ( x X ) ( yY ) P ( x , y )

all x all y

allx all y

Coefficient of correlation= =

xy

x y

E ( X +Y )=E ( X ) + E(Y )

a.

a.

V ( X +Y )=V ( X ) +V ( Y ) +2 COV ( X ,Y )

X

b. If

and

are

independent,

COV ( X ,Y )=0

and

V ( X +Y )=V ( X ) +V (Y )

7.

8.

32 Binomial distributions

Requirements of binomial experiments:

1. Fixed number of trials

2. Two outcomes:

(n)

P ( success )= p

and

P ( failure ) =1 p

3. Independent trials the outcome of one trial does not affect the

outcomes of other trials

Binomial probability distribution:

X Bin (n , p)=

n!

x

nx

n x

nx

p ( 1 p ) =C r p ( 1p )

x ! ( nx ) !

Cumulative probability =P ( X x )

16

Probability that

is at least

Probability that

equals

x=P ( X x )=1P ( X [ x1 ] )

x=P ( x ) =P ( X x )P ( X [ x1 ] )

1.

Mean==np

2.

Variance= 2=np (1 p)

3.

17

33 Requirements of probability density functions

1. The function is above 0:

b

f ( x ) dx=1

34 Uniform distributions

f ( x )=

1

[where a x b ]

ba

P ( x1 < X < x2 ) =Base Height=( x 2x 1)

1

ba

35 Normal distributions

1 x

(

1

f ( x )=

e2

2

() .

Standardised

normal

( )

distributions

are

symmetric

about

36 Exponential distribution

f ( x )= ex [where x 0 ]

18

( )

0:

P ( X > x )=ex

P ( X < x )=1e

37 Student

distribution

( +1) 2

[ ]

[ ( +1 ) 2]

t2

f ( t )=

1+

v ( 2)

It is symmetrical about 0:

Mean=E ( t )=0

Variance=V ( t )=

( )

[ for >2 ]

2

38 Chi-squared distribution

f ( 2) =

( 2)1 2

1

1

( 2 )

e

[ where 2> 0 ]

2

( 2) 2

2

Probabilities

39

+

2

F

(

)

2

2

f ( F )=

( )

F

( ) ( )

1+

(

2

2

)

1

P ( 2 > 2A ) =P ( 2 < 21 A ) = A

distribution

1

1 2

1+ 2

2

[ where F> 0 ]

( )

Mean=E ( F )=

2

[ >2 ]

2 2 2

19

Variance=V ( F )=

2 2 ( 1 + 22)

2

1 ( 22 ) ( 24)

Area the A

P ( F< F 1 A , , )= A

F1 A , , =

[ 2 > 4]

1

F A,

, 2

20

40 Central Limit Theorem (CLT)

The sampling distribution of the mean of a random sample drawn from any

population is approximately normal for a sufficiently large sample size.

2

( )

n

1.

Mean= x =

2.

Variance= 2x =

3.

2

n

distributions

Normally distributed binomial distribution=Y N ( , 2 )

1. Binomial distributions are approximately normally distributed if:

a.

np 5 ; and

b.

n ( 1 p ) 5

2.

Mean==np

3.

Variance= 2=np ( 1 p )

4.

Standard deviation= = np ( 1 p )

(0.5)

random variables:

Binomial distribution

Normal distribution

P ( X=x )

21

P(X x)

P (Y x+ 0.5 )

P(X x)

P(Y x0.5)

sample proportion

1.

^

P

a.

np 5

b.

n ( 1 p ) 5

2.

Expected value =E ( ^

P )= p

3.

p ( 1 p )

Variance=V ( ^

P ) = 2^p=

n

4.

Standard deviation= ^p =

p ( 1 p )

n

between two means

1.

Mean= X X =12

1

2

X 1 X 2

21 22

= +

n1 n 2

2.

Variance=

3.

Standard deviation= X X =

1

21 22

+

n1 n2

22

45 Point vs. interval estimators

1. Point estimators Estimate a parameter using a single value or point

2. Interval estimators Estimate a parameter using an interval

46 Properties of estimators

1. Unbiased The expected value of the estimator equals the parameter:

E ( ^ ) =

2. Consistent As the sample size grows, the difference between the

lim E ( ^ )=

and

variance

is

lower:

^ 1

^ 2

if

deviation

Var ( ^ 1 )<Var ( ^ 2)

( )

from standard

( )

1.

2.

3.

Confidence interval estimator of =m z 2

1.2533

n

49 Sample size

23

( )

from median

1.

2.

z

Sample estimate a mean=n= 2

B

24

25

26

populations

27

28

29

correlation

30

31

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