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MBA 103- Statistics for Management

Ques.1 Give the meaning of the word Statistics. Mention the characteristics of Statistics.

Ans. Statistics can be defined as the branch of mathematics concerned with collection, classification,
analysis, and interpretation of numerical facts, for drawing inferences on the basis of their quantifiable
likelihood (probability). Statistics can interpret aggregates of data too large to be intelligible by ordinary
observation because such data (unlike individual quantities) tend to behave in regular, predictable
manner. It is subdivided into descriptive statistics and inferential statistics.

The characteristics of Statistics areas follows:

Statistics are aggregates of facts.

Statistics are numerically expressed.
Statistics are affected to a marked extent by multiplicity of causes.
Statistics are enumerated or estimated according to a reasonable standard of accuracy.
Statistics are collected for a predetermine purpose.
Statistics are collected in a systematic manner.
Statistics must be comparable to each other.

Ques.2 a. What do you mean by Probability?

Ans. Probability is a branch of mathematics that deals with calculating the likelihood of a given event's
occurrence, which is expressed as a number between 1 and 0.In its simplest form, probability can be
expressed mathematically as: the number of occurrences of a targeted event divided by the number of
occurrences plus the number of failures of occurrences. Probability theory had its start in the 17th
century, when two French mathematicians, Blaise Pascal and Pierre de Fermat carried on a
correspondence discussing mathematical problems dealing with games of chance. Contemporary
applications of probability theory run the gamut of human inquiry, and include aspects of computer
programming, astrophysics, music, weather prediction, and medicine.

b. A bag contains 5 white, 6 red, 2 green and 2 black balls. One ball is selected at random from the
bag. Find the probability that the selected ball is-

i. white

ii. non-white

iii. white or green

iv. black or red

Ans. i. 1/3

ii. 2/3

iii. 7/15

iv. 8/15

Ques.3 What Do you mean by Sampling? Describe various Probability and Non- Probability Sampling

Ans. Sampling is a process used in statistical analysis in which a predetermined number of observations
are taken from a larger population. The methodology used to sample from a larger population depends
on the type of analysis being performed, but may include simple random sampling or systematic
Probability Sampling:

Simple Random Sample: The simple random sample is the underlying model for probability
sampling, although researchers don't actually use it much. Simple random samples are
incorporated into and provide the foundation for more advanced probability sampling designs.
A sample designed in such a way as to ensure that:
1. Every member of the population has an equal chance of being chosen, and
2. Every combination of N members has an equal chance of being chosen.

Systematic Random Sampling: A method of sampling in which every Kth member (K is a ratio
obtained by dividing the population size by the desired sample size) in the total population is
chosen for inclusion in the sample after the first member of the sample is selected at random
from among the first K members of the population. Systematic random samples give results very
similar to those of simple random samples. I would disagree with the authors on the statement
that systematic samples are not truly probability samples.

Stratified Random Sampling: The third type of probability sample that we cover is the stratified
random sample. A method of sampling obtained by:
1. Dividing the population into subgroups based on one or more variables central to our analysis,
2. Drawing a simple random sample from each of the subgroups.
There are two types of stratified random samples:

a. Proportionate: The size of the sample selected from each subgroup is proportional to the size of
that subgroup in the entire population.
b. Disproportionate: The size of the sample selected from each subgroup is disproportional to the
size of that subgroup in the population.
Cluster Random Sampling: The problem with random sampling methods when we have to
sample a population that's disbursed across a wide geographic region in order to get to each of
the units we sampled. In cluster sampling, we follow these steps:
i. divide population into clusters (usually along geographic boundaries)
ii. randomly sample clusters
iii. measure all units within sampled clusters

Non-Probability Sampling:

Convenience Sampling: Convenience sampling (also called haphazard or accidental sampling)

refers to sampling by obtaining units or people who are most conveniently available. For
example, it may be convenient and economical to sample employees in companies in a nearby
area, sample from a pool of friends and neighbors. Convenience samples are least reliable but
normally the cheapest and easiest to conduct. Convenience sampling is most often used during
the exploratory phase of a research project
Purposive Sampling: Depending upon the type of topic, the researcher lays down the criteria for
the subjects to be included in the sample. Whoever meets that criteria could be selected in the
sample. The researcher might select such cases or might provide the criteria to somebody else
and leave it to his/her judgment for the actual selection of the subjects. That is why such a
sample is also called as judgmental or expert opinion sample.
Quota Sampling: A sampling procedure that ensures that certain characteristics of a population
sample will be represented to the exact extent that the researcher desires. In this case the
researcher first identifies relevant categories of people (e.g. male and female; or under age 30,
ages 30 to 60, over 60, etc) then decides how many to get in each category. Thus the number of
people in various categories of sample is fixed. Once the quota has been fixed then the
researcher may use convenience sampling. The convenience sampling may introduce bias.