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Business Statistics: Module 2. Descriptive Statistics Page 1 of 6
Business Statistics: Module 2. Descriptive Statistics Page 1 of 6
Descriptive Statistics
tools used to summarize and present the gathered data in graphical, tabular, or
numerical form so readers can easily understand it; its numerical measures are
measures of central tendency, variability, and distribution of shapes.
In this module, we will focus on the ungrouped data and numerical characteristics of
a sample.
Central tendency – measures how the data are gathered around the central value
Mean – most common measure of central tendency; average value of a given set of
data; serves as the fulcrum or balance point in a set of data; describes what is
typical in a set of data; all values pay an equal role; its greatly affected by extremely
high or extremely low values.
A survey among randomly select 10 students was conducted to determine their daily
allowances (in pesos). Compute the average daily allowance of the students using
the gathered data shown below
100 150 150 100 200 70 140 170 90 120
First thing to do is add all the values and then divide it by the number of samples
X bar = 100 + 150 + 150 + 100 + 200 + 70 + 140 + 170 + 90 + 120 = 1290 = 129
10 10
We can say that the average daily allowance of the 10 students was Php129
Median – middle value in a given set of data, arranged from lowest to highest; .it is
not affected by extremely high or low values provided there is no change on the
number of data
Using the given data on daily allowances, determine the median daily allowance
100 150 150 100 200 70 140 170 90 120
First thing you need to do is arrange the value from lowest to highest
70 90 100 100 120 140 150 150 170 200
Get the average of the ranks 5 and 6 values= (120 + 140) = 260 = 130
2 2
The median daily allowance of the 10 students was Php130
Mode – simplest measure of central tendency; the value which occur most frequency
in a set of data;
The data on daily allowances of the 10 students has two modes, 100 and 150
because both appeared twice in the set of data.
Measures of Variation/Dispersion
Variation – measures how the values are scattered or dispersed from the central
average
Using the data given in measures of central tendency, let us measure the variation.
A survey among randomly select 10 students was conducted to determine their daily
allowances (in pesos). Compute for the range.
100 150 150 100 200 70 140 170 90 120
Before we can calculate the IQR, we need to determine the third and first quartiles
ranks and values; and the formula are:
We also need to arrange the data from lowest to highest. Using the data on the 10
students’ daily allowances, let us arrange it accordingly; and determine the
interquartile range.
70 90 100 100 120 140 150 150 170 200
Q3 = 3(10+1) = 8.25 rank to know the Q3 value, get the 8th value (150) and add it to
4 the product of 0.25 and the difference between 9th (170)
and 8th (150) values
Q1 = (10+1) = 2.75 rank to know the Q1 value, get the 2nd value (90) and add it to
4 the product of 0.75 and the difference between 3 rd (100)
and 2nd (90) values
Variance (S2) – sum of the squared difference of x-value and the mean and divide it
by number of samples minus 1.
Let’s compute the variance using the data on students’ daily allowance
S= S2 = 1610 = 40.12
The daily allowances of the 10 students deviates by P40.12 around the mean of
P129.
CV = S X 100 %
xbar
The standard deviation (40.12) is 31.10% relative to the mean (129) of the daily
allowances of the 10 students
Z-score – also called standardized value; measures the location of a value in relation
to its deviation from the mean; it identifies extreme value or outlier (value which is
distant from the mean; z-scores beyond + 3.00 are considered outliers.
Z = (x – xbar) Let’s use the lowest and highest daily allowance data and
S calculate the lowest and higher z-scores in the said set of data
Zlowest = (70 – 129) = -1.47 Based on the computed z-cores, none of the
40.12 values in the set of data is an outlier.
Zhighest = (200 – 129) = 1.77
40.12
Pattern of Distribution
Shape – shows the pattern of distribution of a set of data, which can either be
symmetrical or skewed
Symmetrical – values are normally distributed; appearance of high and low values in
a set of data are relatively equal
most of the values are in the middle or near the mean and few high or low values
bell-shaped
mean and median values are equal
zero skewness
Left skewed or negatively skewed – most of the values are high and some very
low values appear in the set of data cause the distortion to the left tail of the
shape; mean (xbar) is less than (<) median
Business Statistics: Module 2. Descriptive Statistics Page 5 of 6
Right skewed or positively skewed – most of the values are low and some very
high values appear in a set of data cause the skewness to the right tail of the
shape; mean (xbar) is greater than (>) median
The mean and median daily allowances of the 10 students were P129 and P130
respectively. As such, we can say that the data were negatively skewed because
the mean of P129 is less than the median of P130.
1. In your opinion, which one among the three central tendency measures is the best to
use to analyze a set of data? Explain why you chose that particular measure.
2. Choose one best measure of variation to use; and explain why you prefer that
particular one over the other measures.
1. The following values were from sample of seven (7): 10, 12, 15, 8, 10, 13, 9
a. Compute the mean, median, and mode.
b. Compute the range, interquartile range, variance, standard deviation, coefficient
of variation.
c. Determine if there any outliers in the set of data.
d. How are the set of data distributed? Present your basis.
3. A grade 7 student has been saving money every week for the last two months. Her
weekly savings vary depending on her weekly school expenses. The amount of her
weekly savings (in pesos) are as follows: 50, 60, 55, 40, 45, 70, 100, 80.
a. Compute the mean, median, and mode.
b. Compute the range, interquartile range, variance, standard deviation, coefficient
of variation.
c. Determine if there any outliers in the set of data.
d. How are the set of data distributed? Present your basis.
4. A survey was conducted among 12 college students about the number of hours they
spend every day on Facebook and playing online games. The results are shown on
the table:
Business Statistics: Module 2. Descriptive Statistics Page 6 of 6
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