Lesson 1

Introduction to Statistics

LEARNING OUTCOME(S):
At the end of lesson, the students are expected to:
 Compare and Contrast the foundation concepts and terms of Statistics
 Relate the importance and practical uses of Statistics

In the conduct of the study, the population is defined in keeping with the objective of the study.
The population is the totality of the elements (person, objects, things and animals) in which data is
to be collected. If the population is large, collection of data can be costly and time consuming. Hence,
sampling is recommended. A sample is a representative of the population.

Example, you might take a survey of all the Filipino people affected by the Covid19 pandemic, but
because Philippines is a large population, so you take a sample. That may be a thousand affected
persons in the selected region in the Philippines.

Researches are carried out in sample rather than the population. To communicate result findings
from the sample, Statistics is applied.

DEFINITION

What is statistics? We may have many questions like “Should I pursue this
career?” or “Should I pass in this subject?” Truly the need for statistics is very essential. But
before we consider the different statistical tools and procedures, let us first define it.

Statistics is a branch of Science that deals with the development of methods for a more
effective way of collecting, organizing, presenting and analyzing data.

MAJOR AREAS OF STATISTICS

The study of Statistics is classified into two major areas, namely: Descriptive Statistics and
Inferential Statistics.

Descriptive Statistics deals largely with summary calculations, graphical and tabular displays, and
describing important features of a set of data. It does not attempt to draw conclusions about
anything that pertains to more than the data themselves.

It may answer questions such as:

 What are the highest and the lowest scores obtained by applicants in a managerial position?
 What are the characteristics of the most successful sales representative according to
customers?

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  Which group of employees has produced more outputs?

Inferential Statistics is concerned with making generalizations for a bigger group of observations
called population based on the information gathered from a small group of observations or sample
drawn from the given population. It may the answer questions like:

 Is there a significant difference between the performance of male and female students in
statistics?
 Is there a significant correlation between educational attainment and job performance rating?

With Inferential Statistics, we are trying to reach conclusions that extend beyond the immediate
data alone. Or, we may use it to make judgments of the probability that an observed difference
between groups is a dependable one, or one that might have happened due to chance. It is a matter
of deciding between REALITY and COINCIDENCE.

Characteristics measured from the person, object or thing is called as variable. The value of
the observations under a specific variable is called as data.
Data can be classified as qualitative and quantitative.
Qualitative data are expressed in non-numeric such as categories, kinds, brands or names.
Example, course you are enrolled in. The course is a variable, BPA is the data.
Quantitative data are expressed in numbers. Example, age. The age is a variable, 19 years
old is the data.

Variables are properties or characteristics measured from the person, object or thing. This
can be represented with letters/symbols which take on different values. If the variable is quantitative
it can be classified as

Discrete variable can be counted, thus assume a value which is a whole number, e.g. number of
students in a class, number of siblings.

Continuous Variable can have an infinite number of values between two points. It can be measured
using some units of measurements. It may take some decimal numbers, e.g. height, weight, age

SCALES OF MEASUREMENT

Measurement is a process of assigning a numerical value to a characteristic of the object

being measured.

There are four types of measurement. These levels of measurement will be important,
because certain calculations can be done with only certain kinds of data

Nominal scale data is made up of values that are distinguished by name only. This is the
weakest/lowest form of measurement. It does not possess the property of order, e.g. brand of
cellphones, gender.

Ordinal or Ranking scale. Ordinal has order. This level of measurement uses numbers as
codes to classify an object person or characteristics into certain categories, but these categories
are ordered or ranked. Example: in a beauty pageant, you rank the winners, e. i. First, Second
and third or in a community we have high-income, middle-income and low-income.

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 The thing that ordinal level data lacks is that you can't measure the difference between data.
We know that high-income people earn more than low-income people, but how much. This is
where the third level of data comes in.

Interval scale data is similar to ordinal scale data in that it has a definite ordering scheme,
but it is different in the fact the differences between data is meaningful and can be measured. The
one thing that interval data lacks is a zero starting point. Example is the temperature. We can tell
whether a temperature is higher or lower, so we can put them in an order. If the temperatures are
25º and 38º, we can arrange it in order. , we can arrange it in order, 38º is hotter than 25º. Also,
the second temperature is 13º higher than the first. So the differences between data are measurable
and meaningful.

The one thing that interval data lacks is a zero starting point. Is 0 degrees the absolute lowest
temperature? Of course no, temperatures go below 0 degrees on a regular basis. Because there is no
zero starting point, ratios between 2 data values are meaningless. Is 75 degrees three times as hot
as 25 degrees? No, because the ratio of 75 to 25 (i.e. 3 to 1) is meaningless here. Here comes
another scale of measurement.

Ratio Scale has the property of the Interval scale data, except that it has a true zero point.
Example, 3 students were randomly selected. Their pocket money are as follows; P100, P25, P64. We
can arrange the money in order, e.i. P25, P64, P100. We can also say that the second student has
P39 more than the first one.

Can we calculate ratios based on this data? Yes because P0 is the absolute minimum amount
of money a person could have with them. The person with P100 has 4 times as much as the person
with P25.

WHY DO WE NEED STATISTICS?

The knowledge of Statistics would help you:

1. Describe and understand numerical relationships. Although data gathered, processed and
presented maybe substantial, it is necessary that you be able to get from these data those
that can identify and describe obscure relationships of variables that are important in decision
making.
2. Make better decisions. Knowledge of statistics allows people to make better decisions in the
face of uncertainty.

Some Uses of Statistics

Statistics has general applicability. It is an essential tool in education, government, business,
economics, medicine, psychology, social sciences, sports and others.
In education, for example, statistics is used to get information on enrolment, finances,
physical facilities, etc., which are needed in the administration and management of the system.
Psychologists are able to understand human beings more through their intelligence quotient,
attitudes, etc.
In business and economics, statistics is used in forecasting business trends, quality control of
products, in making decisions and policies.
Statistics provide the government with data necessary in the management of the affairs of the
state like population, cost of living, taxes, wages, and other resources important in policy-making
and administration

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We can DO this

Group yourselves consisting of 4 members. Select your leader and do the activity.
For your output, you can encode or hand write it. Be sure that everyone understands the
lesson. Each group will discuss among themselves, exchange of ideas is encourage. Assign
one (1) member who will write the output. Take a picture of your output and send it
through private message. The deadline will be posted later.

Let’s DO this

Open the link below

https://www.researchgate.net/publication/281370869_Accounting_Research_Journal

1. After reading, identify the following

 Variables of the study (Identify if it is qualitative or quantitative. If it is quantitative,

identify if it is discrete or continuous. Classify whether it is nominal, ordinal, interval or
ratio
Example: Gender – qualitative - Nominal
Age – quantitative – continuous - Ratio
 Participants of the study
Example: Residents of Malaybalay city

Note: If you have difficulty opening the link, look for other research journal in line with your course.
Please screenshot the selected journal and submit it together with your answer.

2. Based on the reading, how is Statistics important to business/accounting?

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