What about this data?

• Telecommunications company
• Investigating the amount of the
first bill for new customers Bills
42.19
• 200 bills 38.45
29.23
89.35
118.04
110.46
0
72.88
83.05

Bond Business School Data Analytics for Decision Making – Lecture 1b 1

New Customers: First Bill

Class Bins Frequency

0 up to 15 15 71
15 up to 30 30 37
30 up to 45 45 13
45 up to 60 60 9
60 up to 75 75 10
75 up to 90 90 18
90 up to 105 105 28
105 up to 120 120 14

Bond Business School Data Analytics for Decision Making – Lecture 1b 2

New Customers: First Bill
Histogram of First Bill Size
80

70

60

50
Frequency

40

30

20

10

0
15 30 45 60 75 90 105 120
First Monthly Bill ($) - Upper Limit of Class

Bond Business School Data Analytics for Decision Making – Lecture 1b 3

Interpretation?
About half of all A few bills are in A relatively
the bills are small the middle range large number
of large bills
80 71+37=108 13+9+10=32
18+28+14=60
Frequency

60

40

20

0
90
15
30
45
60
75

105
120
First Monthly Bill ($):
Upper limit of each class

Bond Business School Data Analytics for Decision Making – Lecture 1b 4

Relative frequency

Frequency
Relative frequency =
Total number of observations

• Provide insight into population from

sample
• Comparing histograms
– Different sample sizes

Bond Business School Data Analytics for Decision Making – Lecture 1b 5

New Customers: First Bill

Class Bins Frequency Relative Frequency

0 up to 15 15 71 35.5%
15 up to 30 30 37 18.5%
30 up to 45 45 13 6.5%
45 up to 60 60 9 4.5%
60 up to 75 75 10 5.0%
75 up to 90 90 18 9.0%
90 up to 105 105 28 14.0%
105 up to 120 120 14 7.0%

Bond Business School Data Analytics for Decision Making – Lecture 1b 6

 Histogram of First Bill Size
0.4

0.35

0.3
Relative Frequency

0.25

0.2

0.15

0.1

0.05

0
15 30 45 60 75 90 105 120
First Monthly Bill ($) - Upper Limit of Class

Bond Business School Data Analytics for Decision Making – Lecture 1b 7

Choosing Categories?
• Number of categories depends on
• Size of the data set
• How many observations you would
like in each category
• Business-sense
• Usually recommended between 5
and 15

Bond Business School Data Analytics for Decision Making – Lecture 1b 8

Histogram
1. Collect data

2. Prepare a frequency distribution

– Or relative frequency distribution

3. Draw a histogram
– Or relative frequency histogram

Bond Business School Data Analytics for Decision Making – Lecture 1b 9