Statistics

Unit # 1
INTRODUCTION

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 Objectives
• Understand the complexity of managerial
decisions
• Know the need of using quantitative approach to
managerial decisions
• Appreciate the role of Statistical methods in data
analysis.

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 Why Statistics?
Problem faced by a researcher.
 How much wheat will be produced?
How many new universities will be required?
The study of productivity of seed varieties by
an agircuturist.
The study of effectiveness of medicines by a
physician.
To solve such problem we need to explore the
numerical fact and figures. Here we need 3
 Role of observations ?

The observation play very important role in all

field of study such as:
Agriculture, Industry, Transport, Business,
Insurance, Banking and biological sciences etc.

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 INTRODUCTION TO STATISTICS
• Statistics:-
May be defined as a science of collection, representation,
analysis and interpretation of numerical data under
uncertainty conditions.
• Descriptive Statistics:
Deals with the collection, Classification, Summarization
and presentation of data
• Inferential Statistics:
Deals with the conclusion drawn about the population
using the data of a sample taken from the same
population.

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Statistics presents a rigorous scientific method for
gaining insight into data. For example, suppose we
measure the weight of 100 patients in a study. With
so many measurements, simply looking at the data
fails to provide an informative account. However
statistics can give an instant overall picture of data
based on graphical presentation or numerical
summarization irrespective to the number of data
points. Besides data summarization, another
important task of statistics is to make inference and
predict relations of variables.

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 INTRODUCTION TO
 Population STATISTICS
A population is the totality of the observations made on all the objects
(under investigation) possessing some common specific characteristics,
which are of particular interest to researchers. It is the entire group
whose characteristics are to be estimated.
• The heights of all the students enrolled at IBMS in MBA degree
program.
• The wages of all employees of a mill in a given year, etc.
A population may be finite or infinite.
The number of observations in a finite population is called the size of the
population and is denoted by the letter N.
 Sample
A sample is a representative part of the population which is selected to
obtain information concerning the characteristics of the population. The
number of observations in a sample is called the size of the sample
which is denoted by n. 7
 INTRODUCTION TO
STATISTICS
 Sampling
The process of drawing a sample from population is called
sampling.
Why take a sample
1. Reduced Cost: The study of a sample is less costly.
2. Greater Speed: A sample study take less time.
3. Greater Accuracy:
4. Greater Scope: In sample study , the volume of
work is reduced and hence higher quality of labor
with better supervision can be employed.

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INTRODUCTION TO STATISTICS
Parameter
A parameter is a numerical characteristic of a population, such as its
mean or standard deviation, etc. Parameters are fixed constants that
characterize a population. They are denoted by Greek letters.
Parameter is a fixed quantity.
Statistic
A statistic is a numerical characteristic of a sample such as its mean
or standard deviation, etc. The statistics are used to draw valid
inferences about the population. They are denoted by Latin letters.
Statistic is a variable quantity.

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 Variables
Any characteristic, which may varies with respect to individual,
time, and (or) place. For example
 No of products produced by a machine during a specified
period of time.
 Number of workers
 Weight of a any individual
 Price, Sale, Adv. expenditures
 Quality, Design, Performance

Variables are usually represented by last alphabets as X, Y, Z etc.

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 Types of variables
Fixed variables:- Random Variables:-
1.Design 1.Sales
2.Quality 2.Growth
3.Adv. Expenditures 3.Recovery Time
4.Diet 4. Yield
5.Dose of a medicine 5. Marks
6.Amount of
Fertilizer
7.Study Hours

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 Types of variables
 Qualitative variable
Characteristic which varies in quality (not numerically) from one
individual to another, also called attribute, e.g. eye color, education
level, Behavior, quality, Design, Performance.
 Quantitative variable
Variable is called a quantitative variable when it varies in quantity (or
numerically) from one individual to another, e.g. age, income,
temperature, Price , Sale, Advertising Expenditures

Types of Quantitative variable

 Discrete variable
Variable take only specified values or take values by jumps or breaks,
e.g. number of rooms in a house, number of deaths in an accident etc.
 Continuous variable
If it can assume any value (fractional or integral) within two specified
values ‘a’ and ‘b’, e.g. height of a plant, speed of a car, Sale, Price

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 Measurement
 The process of assigning numbers or labels to objects, persons,
states or, events in accordance with specific logically accepted rules
for representing quantities or qualities of attributes or
characteristics. Data can be classified according to levels of
measurement. The level of measurement of the data often dictates
the calculations that can be done to summarize and present the data.
It will also determine the statistical tests that should be performed.
There are actually four levels of measurement: nominal, ordinal,
interval, and ratio [Stevens 1951].
 The lowest, or the most primitive, measurement is the nominal level.
The highest, or the level that gives the most information about the
observation, is the ratio level of measurement.

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 Scale of Measurement
 Nominal Scale
These scales are comprised of numbers used to categorize
objects or events. Nominal numbers serve as a label for a
category. Eye color, religion, Gender, Product Name, Reg. # etc.
 Ordinal Scale
The scales are represent numbers used to rank items. Ordinal
data indicate the relative positions of two or more items on some
characteristic but not the magnitude of difference between the
items. These numbers can be arranged but arithmetical
operations are meaningless. (e.g. high/medium/low income). For
example, cricket teams standings in ICC ranking, students’
grades, etc.
The Branch of statistics that deals the data related to the above
two scales is called non parametric statistics.

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 Scale of Measurement
 Interval Scale

The data has equal intervals between data points. For example,
temperature, shoe size and IQ scores, etc.

 Ratio Scale

The data has equal intervals between data points and a true zero.
For example, bank balance, weight, height, Age, etc.

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INTRODUCTION TO STATISTICS
 Observation
The numerically recording of information is called observation or
datum.
 Observations can be simply divided into three types: categorical
where the observations can be in a limited number of categories
which have no obvious scale (e.g. ‘Pass’, ‘Fail’, ‘Yes or No’);
 Discrete where there is a real scale but not all values are possible
(e.g. ‘number of Products’ or ‘number of students )
 Continuous where any value is theoretically possible, only
restricted by the measuring device (e.g. lengths, concentrations,
Weight ).

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INTRODUCTION TO STATISTICS
 Data
The Collection of some related observations is called data.
 Classification of data
Data that may have been originally collected and have not
undergone any sort of statistical treatment are called Primary
data, while the data that have undergone any sort of statistical
treatment at least once are called Secondary data.
Data may be available from existing sources e.g. records and
publications or the same may have to be collected afresh.

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 INTRODUCTION TO
STATISTICS
 Collection of primary data
(1) Direct personal investigation
(2) Personal interview
(3) Collection through questionnaires.
(4) Collection through enumerators.
(5) Collection through local sources
 Collection of Secondary data:
1. Official Publications
 Federal Bureau of Statistics
 Population Census of Organization
 Ministries of Health, Food, Agriculture, Finance etc.
 Provincial Bureaus of Statistics
(2) Semi-official

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