I

NTRODUCTI
ON

Thewor
d"st
ati
sti
cs"conv
eysav
ari
etyofmeani
ngst
opeopl
e,manyof

whi
char
einaccur
ateor
,att
hev
eryl
east
,mi
sleadi
ng.Tosome,
thewor
d

suggest
sonl
yapl
ethor
aofmi
nd-
boggl
i
ngt
abl
es,
char
ts,
andf
igur
es.Ot
her

peopl
econsi
derst
ati
sti
cst
obeani
mposi
ngf
orm ofmat
hemat
ics.Theuseof

t
hewor
dcer
tai
nlyhadani
nauspi
ciousbegi
nni
ng,
asmi
ghtbesuspect
ed

f
rom acur
sor
yst
udyoft
hewor
d,f
ori
twasor
igi
nal
l
yat
erm usedt
odenot
e

acol
l
ect
ionoff
igur
es,
graphsandt
hel
i
kewhi
chcont
ainedusef
ul

i
nfor
mat
ionf
ort
hest
ate(
pri
mar
il
ybudgeti
nfor
mat
ionsuchast
axat
ionf
igur
es)
.

Usedi
nthecont
extofi
tsor
igi
nal
meani
ng,
stat
ist
icsgener
all
yref
erst
o

i
nfor
mat
ionaboutanact
ivi
tyorapr
ocesst
hati
sexpr
essedi
nnumber
sli
sted

i
ntabl
esori
l
lust
rat
edi
nfi
gur
es.But
,si
ncei
tsear
lyconnot
ati
on,
stat
ist
ics

hasgr
ownt
oencompassal
argerr
olet
hanpr
esent
inguswi
thchar
ts,
graphs,

andt
abl
esorf
igur
es.I
namoder
nset
ti
ng,
stat
ist
icsr
efer
stot
hesci
enceof

col
l
ect
ing,
present
ing,
andanal
yzi
ngnumer
ical
dat
a.Ast
ati
sti
ciani
s

aper
sonwhoengagesi
noneormor
eoft
hef
oll
owi
ngt
asks:

(
1)t
hecl
eri
cal
act
ivi
ti
esoft
abul
ati
ng,
summar
izi
ng,
anddi
spl
ayi
ng

st
ati
sti
cal
dat
a.

(
2)anal
yzi
ngdat
abyusi
ngst
ati
sti
cal
met
hods,
usual
l
yfort
hepur
posesof

deci
sionmaki
ng.

(
3)adv
anci
ngt
hesci
enceofst
ati
sti
csbydev
elopi
ngnewandbet
ter

anal
ysi
smet
hods.

Thel
evel
sofexper
ti
ser
equi
redbyst
ati
sti
ciansr
angesf
rom mast
eri
ng
si
mplecleri
cal
oper
ati
onswit
hdatatoadv
ancedt
rai
ningi
nappl
i
edmat
hemat
ics,
and
st
ati
sti
ciansar
eneededatal
ll
evel
s.

Theuseofst
ati
sti
cshasper
meat
edal
mostev
eryf
acetofourl
i
ves.The

dai
l
ynewspaper
sandt
het
elev
isednewsr
epor
tssuppl
yuswi
thnumer
ous

summar
iesofdat
asuchasst
ockmar
ketr
epor
ts,
financi
alsummar
ies,
and

cr
imest
ati
sti
cs-
andwi
tht
her
esul
tsofst
ati
sti
cal
anal
yses-
weat
herf
orecast
s,

pol
i
tical
elect
ionout
comepr
edi
cti
ons,
andsoon.

Gov
ernment
s,busi
nesses,
andi
ndi
vi
dual
scol
l
ectst
ati
sti
cal
dat
arequi
red

t
ocar
ryoutt
hei
ract
ivi
ti
esef
fi
cient
lyandef
fect
ivel
y.Ther
ateatwhi
ch

st
ati
sti
cal
dat
aar
ebei
ngcol
l
ect
edi
sst
agger
ingandi
spr
imar
il
yduet
othe

r
eal
i
zat
iont
hatbet
terdeci
sionsar
epossi
blewi
thmor
einf
ormat
ionand,

per
hapsmor
eimpor
tant
ly,
tot
echnol
ogi
cal
adv
ancest
hathav
eenabl
edt
he

ef
fi
cientcol
l
ect
ionandanal
ysi
sofl
argebodi
esofdat
a

DEFI
NITI
ON

St ati
sticscanbedef i
neast hepracti
ceorsci enceofcol l
ect i
ngandanal ysingnumer icaldatai
n
l
argequant it
ies,especi all
yforthepur poseofi nferri
ngpr opor t
ionsinawhol ef r
om thosei na
represent ativesampl e.
St at
isti
csisthedi sci
pl i
net hatconcer nsthecol l
ect
ion,organizati
on,
anal y
sis,interpretation, andpresentationofdat a.I
nappl yingstatist
icstoasci enti
fi
c,industr
ial
,
orsoci alpr oblem, i
ti sconv enti
onaltobegi nwi t
hast at
isticalpopulati
onorast ati
sticalmodel
tobest udied.Popul at i
onscanbedi ver segroupsofpeopl eorobj ectssuchas" allpeopleli
ving
i
nacount ry"or" everyat om composi ngacr y stal".Stati
sti
csdeal swi theveryaspectofdat a,
i
ncl udingt hepl anningofdat acoll
ectioni nt
er msoft hedesi gnofsur veysandexper iment s

I
MPORTANCEOFSTATI
STI
CS

1)Ever
ybodywatchesweatherf
orecasti
ng.Haveyouev ert
hinkhowdoy ougetthati
nfor
mat
ion?
Ther
earesomecomput er
smodel sbuildonstat
ist
ical
concepts.Thesecomputermodels
comparepri
orweatherwi
ththecurrentweat
herandpredictfut
ureweather
.

2)Stati
sti
csmostlyusedbytheresear
cher.Theyusethei
rst
ati
sti
calski
l
lst
ocol
l
ectt
he
rel
evantdata.Ot
herwise,
itr
esul
tsinalossofmoney ,
timeanddata.

3)Whatdoy ouunder
standbyinsurance?Everybodyhassomekindofinsur
ance,
whetheriti
s
medi
cal,homeoranyot heri
nsurance.Basedonani ndi
vi
dual
appli
cat
ionsomebusinessesuse
st
ati
sti
calmodelstocalcul
atetheri
skofgivinginsur
ance.
4)Infinanci
almarketal
sost
ati
sti
cpl
aysagr
eatr
ole.St
ati
sti
csar
ethekeyofhowt
rader
sand
businessmeninvestandmakemoney.

5)St
ati
sti
csplayabi
grolei
nthemedi
cal f
iel
d.Beforeanydrugspr
escr
ibed,
sci
ent
istmust
showastati
sti
cal
l
yvali
drat
eofef
fect
iveness.St
atist
icsar
ebehindal
lthest
udyofmedical
.

6)St
ati
sti
calconceptsareusedinquali
tytest
ing.Companiesmakemanyproduct
sonadai
l
y
basi
sandeverycompanyshoul dmakesur ethattheysol
dthebestqual
it
yit
ems.But
compani
escannott estal
lthepr
oducts,sotheyusestati
sti
cssample.

Whatdi
sti
ngui
shbet
weenDescr
ipt
ivest
ati
sti
csandI
nfer
ent
ial
Stat
ist
ics

Stat
isti
csareknownasdescript
ivestati
sti
cs,whi
chdescri
bestheproperti
esofsampl eand
populat
iondata,
andinf
erent
ialst
atisti
cs,whi
chusesthoseproper
tiestotesthypothesesand
drawconclusi
ons.Somecommonst ati
sti
calt
oolsandprocedur
esincludethefol
lowing:

Descr
ipt
ive

Mean(
aver
age)

Var
iance

Skewness

Kur
tosi
s

I
nfer
ent
ial

Li
nearr
egr
essi
onanal
ysi
s

Anal
ysi
sofv
ari
ance(
ANOVA)

Logi
t/
Probi
tmodel
s

Descr
ipt
iveSt
ati
sti
cs

Descriptivestati
sti
csmost l
yf ocusont hecent raltendency ,vari
abil
ity,anddi stributionof
sampl edat a.Centraltendencymeanst heest i
mat eoft hechar acteristics, atypi calelementofa
sampl eorpopul ati
on, andincludesdescr i
ptivest ati
sti
cssuchasmean, medi an, andmode.
Variabil
i
t yrefer
stoasetofst at isti
csthatshowhowmuchdi ff
erencet her eisamongt he
elementsofasampl eorpopul ationalongthechar acteristicsmeasur ed, andi ncl udesmet ri
cs
suchasr ange,vari
ance, andst andar ddeviati
on. Thedi stributi
onr eferst ot heov erall"shape"of
thedata, whichcanbedepi ctedonachar tsuchasahi st ogram ordotpl ot,andi ncl
udes
properti
essuchast heprobabi l
itydistri
buti
onf unct i
on, skewness, andkur t
osis.Descr ipti
ve
stat
isti
cscanal sodescr i
bedi fferencesbet weenobser v edchar acteristicsoft heel ement sofa
dataset .Descript
ivest at
ist
icshel pusunder standt hecol l
ectiv
epr oper tiesoft heel ement sofa
datasampl eandf ormt hebasi sf ortesti
nghy pot hesesandmaki ngpr edi cti
onsusi ngi nf
erenti
al
st
ati
sti
cs.

I
nfer
ent
ial
Stat
ist
ics

Inferent
ial st
ati
sti
csar etoolst hatst atisti
ciansuset odr awconcl usi
onsaboutt he
character i
sti
csofapopul at i
on, drawnf rom t hechar acteri
sti
csofasampl e, andt odecidehow
certaintheycanbeoft her el
iabili
t yoft hoseconcl usions.Basedont hesampl esi zeand
distri
butionstati
sti
cianscancal cul atet hepr obabili
tythatstati
stics,whi
chmeasur et hecentral
tendency ,vari
abil
i
ty,dist
ributi
on, andr elationshipsbet weenchar acteri
sti
cswi thinadat a
sampl e,provideanaccur atepi ctur eoft hecor respondi ngparamet ersofthewhol epopul at
ion
from whi chthesampl eisdr awn.I nferent ialstatist
icsar eusedtomakegener al
izationsabout
l
ar gegroups, suchasest imat i
ngav eragedemandf orapr oductbysur veyingasampl eof
consumer s'buyi
nghabi t
sort oat temptt opr edictfutureevents,suchaspr ojectingt hefuture
returnofasecur it
yorassetcl assbasedonr eturnsinasampl eper i
od.