ianeened COURSE MANUAL FOR UNDERGRADUATE COURSES (For Internal Circulation only) BUSINESS DATA ANALY; IH SEMESTER B.Com (As per Bengaluru City University CBCS Syllabus) RAJI PILLAI Professor, Department of Commerce and Management Seshadripuram College SINDHUMM Associate Professor, Department of Commerce and Management Seshadripuram College SANDESH V Assistant Professor, Department of Commerce and Management Seshadripuram College POORNIMA K Assistant Professor, Department of Commerce and Management Seshadripuram College SESHADRIPURAM EDUCATIONAL TRUST BENGALURU, MYSURU, TUMAKURU, MANDYAPublished : First Edition: 2020-2021 Printed : KRIYA PRAKASHANA # 40/5, 2nd 'B' Main, 16th Cross, SR Nagar, Bengaluru - 27 Ph.:080 22234369 e-mail : kriyaprakashana@gmail.comACKNOWLEDGEMENT It has given us great pleasure to prepare the Course Manual for the subject Business Data Analysis as per the syllabus prescribed for I Semester B.Com by Bangalore University under the CBCS scheme. We have attempted to present the material in a manner which will help students to understand concepts clearly. We would like to emphasise that this manual attempt to lay the foundation for understanding and learning the subject and cannot be taken as a substitute for a standard textbook or reference book. We also hope that the material provided . will’ motivate students to explore the subject beyond examination requirements. We arc grateful to the Management for giving us the unique opportunity to prepare the course manual which we hope will be of great use for our students. We would like to thank our Principal Dr. Meera H. N, the HOD of Commerce and Management Prof. V Mahalakshmi and all faculty of the department for their support and guidance in preparing the manual. We are extremely grateful to the subject reviewers Prof. Kala Naik for our manual. We also extend our heartfelt thanks to Ms Nalini Harish and Smt. Sapna H of the English Department for undertaking the task of language review and to Dr Anuradha’ Roy, Principal, ‘Seshadripuram College for the final review of language and presentation. We would also like to thank our students who have been our constant motivation in preparing this manual. We look forward to their feedback which will help us to improve the material in subsequentyears. Raji Pillai Sindhu MM Sandesh V Poornima KPREFACE From time immemorial, mankind has been using numbers without proper procedures. Dealing with numbers, data or information is nothing less than impossible. Statistics is that science that deals with proper treatment and understanding of data. Chanakya in his most revered book, ‘Arthashastra’ clearly explains the importance of Statistics. Indians were pioneers and paved the way for others in this field. Statistics is of utmost importance in today’s era because in every walk of life, right from an individual’s personal life to a country’s growth statistics isindispensable. Statistics has been given an important place in the field of social sciences, business management, public administration etc. No student of these disciplines can afford without the knowledge of Statistics, as this is one of the important branches of anybusiness. With the scope of Statistics expanding it is used by researchers in many fields to organize, analyze and summarize data. It is important to understand statistics so to be able to evaluate the credibility and usefulness of information, and make appropriate decisions based on it. In the present era, it is important for Commerce students to understand and appreciate how statistical data in different forms may be interpreted and analysed to help create well-informed business decisions in various areas, be it budgeting, purchasing, marketing, or staffing. The objective of this paper Quantitative Analysis for Business Decisions -4, prescribed for II Semester B.Com students of Bangalore Universily is provide students with an in-depth understanding of Statistical concepts, methods and techniques and familiarise them with their usage and applicability in business decisions.3.6 BUSINESS DATA ANALYSIS Syllabus LEARNING OBJECTIVE The objective of this subject is to help the students to acquire knowledge on the various statistical tools used for data analysis that can be applied in Business. Unit 1: INTRODUCTION TO STATISTICS 12 Hrs. Introduction — Meaning, Functions and Uses of Statisticr; Collection of Data = Techniques of Data Collection = Census Technique and Sampling Technique (Concepts). Classification: Meaning, and Methods of Classification of Data, Tabulation: Meaning, Parts of a Table — Simple problems on Tabulation; Diagrammatic Presentation: Bar Diagrams — Simple Bars, Multiple Bars, Percentage Sub-divided Bar Diagram; Two Dimensional Diagrams — Pie Diagram. Unit 2: MEASURES OF CENTRAL TENDENCY AND DISPERSION 18 Hrs. Measures of Central Tendency: Arithmetic Mean: Calculation of Arithmetic Mean for Individual, Discrete and Continuous Series — Problems using Direct Method. Medlan: Calculation of Median for Individual, Viscrete and Contmuous Series Mode: Calculation of Mode for Individual, Discrete and Continuous Series using Inspection method (Excluding problems using Grouping Tables), Empirical relation between Mean, Median and Mode. Measures of Dispersion: Calculation of Standard Deviation and Coefficient of Variation in Individual, Discrete. and Continuous Series — Problems using Direct Method. Measures of Skewness: Calculation of Karl Pearson’s co-efficient of Skewness (Uni-modal)Unit 3: CORRELATION AND REGRESSION ANALYSIS 12 Hrs. Correlation Analysis - Meaning, Types of Correlation, Calculation of Karl Pearson’s Coefficient of Correlation in individual series — Problems using Direct Method only; Computation of Probable Error. Regression Analysis ~ Meaning of Regression, Estimation of X and Y values using Regression Equations when regression coefficients are given. Unit 4: TIME SERIES ANALYSIS 06 Hrs. Meaning, Components, Fitting a straight-line trend using Least Square Method (Problems where ZX=0 only), calculation and estimation of trend values. Unit 5: INTERPOLATION AND EXTRAPOLATION 08 Hrs. Meaning, Assumptions, Methods of Interpolation — Binomial Expansion Method with one or two missing values, Newton’s Advancing Differences Method (Problems on one missing value using maximum five X values)CONTENTS Sl. ‘ Na Units Page No. 1 | INTRODUCTION TO STATISTICS 1-40 2 | MEASURES OF CENTRAL TENDENCY AND ‘198 DISPERSION 3 | CORRELATION AND REGRESSION 2836 ANALYSIS 4 | TIME SERIES ANALYSIS 131-147 5 | INTERPOLATION AND EXTRAPOLATION 148 - 174 BOOKS FOR.REFERENCE 175 NOTE 176 viiUNIT -1 INTRODUCTION TO STATISTICS Introduction — Meaning, Functions and Uses of Statistics; Collection of Data - Techniques of Data Collection — Census Technique (Meaning) and Sampling — Meaning and Methods of Sampling; Classification: Meaning, Objectives and Methods of Classification of Data, Tabulation: Meaning, Parts of a Table and Types — Simple problems on Tabulation; Diagrammatic Presentation: Bar Diagrams ~ Simple Bars, Multiple Bars, Pefcentage Sub-divided Bar Diagram; Two Dimensional Diagrams ~ Pie Diagram. Introduction Statistics is not a subject of recent origin but is as old as human society itself. The subject knowledge of statistiés was used from the time of existence of life on carth, but its use was not very evident. In ancient times the scope of statistics was primarily limited in keeping the records of the population regarding birth, age, gender, death, poverty, wealth of a country or a state so that it helped in administration, allocation of resources, maintenance of tax system, preparation of military strategy etc. Hence statistics was regarded as “Science of Kings” or “Science of Statecraft”, The word ‘STATISTICS” has been derived from the Latin word ‘STATUS? or Italian word ‘STATISTA” or the German word ‘STATISTIK’ or the French word ‘SLALISTIQUE’, each of which. means a political state. The term statistics was applied to mean facts and figures which were needed by the state in its day to day life. Statistics was regarded as a by-product of administrative activities of the state: The term statistics has evolved over a period and many people have contributed to the development of statistics. The development of modem statistics started after Industrial Revolution and in the present age, statistics is regarded as’ one of the most important tools for decision making, Statistical methods and principles have found applications in many fields, ie., business, social sciences, engineering, natural and physical sciences etc. Almost BUSINESS DATA ANALYSIS JIT SEMESTER B.COM |1every aspect of natural phenomena and human or other activity is subjected to measurement and interpretation in terms of statistics. The term “Statistics” is used in two senses: first in plural sense meaning a collection of numerical facts or estimates—the figures themselves. It is in this sense that the public usually think of statistics, e.g., figures relating to population, profits of different units in an industry etc. Secondly, as a singular noun, the term ‘Statistics’ denotes the various methods adopted for the collection, analysis and interpretation of the facts numerically represented. In singular sense, the term ‘Statistics’ is better described as statistical methods. In our study of the subject, we shall be more concerned with the second meaning of the word ‘Statistics’. Meaning of Statistics From a common man’s point of view, \Statistics means data, facts or measurements. Some regard it as the study of figures, Statistics is also considered as analysis if figures for forecasting or drawing inferences. It is also understood as diagrammatic or graphic representation of facts. In general, Statistics, is the study of the collection),organisation, analysis, interpretation and presentation of data. In other words, “Statistics’, refers to the statistical principles and methods which havebeen developed for handling numerical data. Definition of Statistics Statistics has been defined differently by different authors and each author has assigned new limits to the field which should be included in its scope. Different definition of statistics emphasizes the meaning, scope and limitations of the subject. ALL. Bowley states, “Statistics may be called the Selence of Counting”. He also suggests, “Statistics may be called as the Science of Averages”. Both these definitions are narrow and throw light only on one aspect of Statistics. According to King, “The Science of Statistics is the method of judging collective, natural or social, phenomenon from the results obtained from the analysis or enumeration or collection of estimates”. Many a times counting is not possible, and estimates are required to be made. Therefore, Boddington defines Statistics as “the Science of Estimates 2 | BUSINESS DATA ANALYSIS I] SEMESTER B,COMand Probabilities”. But this definition also does not cover the entire scope of statistics. The statistical methods are methods for the collection, analysis and interpretation of numerical data and form a basis for the analysis and comparison of the observed phenomena. In the words of Croxton &Cowden, “Statistics may be defined as the collection, presentation, analysis and interpretation of numerical data”. Horace Secrist has given an exhaustive definition of the term statistics in the plural sense. According to him: “By statistics we mean aggregates of facts affected to a marked extent by a multiplicity of causes. numerically expressed, enumerated or estimated according to reasonable standards of accuracy collected in a systematic manner for a pre-determined purpose and placed in relation to each other”. This definition makes it quite clear that as numerical statement of facts, ‘Statistics’ should possess the following characteristics: Characteristic features of Statistics: 1. Statistics are aggregate of facts: Single values, isolated figures are not statistics as they cannot be compared, and they are irrelevant. A single age of 20 or 30 years is not statisties, a series of ages is. Similarly, a single figure relating to production, sales, birth, death etc., would not be statistics although aggregates of such figures would be statistics because of their comparability and relationship. 2. Statistics are affected to a marked extent by a multiplicity of causes: Several causes ‘affect statistics ina particular field of enquiry, e.g, in production statistics are affected by climate, soil, fertility, availability of raw materials and methods of quick transport. 3. Statistics are numerically expressed, enumerated or estimated: The subject of statistics is concerned essentially with facts expressed in numerical form—with their quantitative details but not qualitative descriptions. Therefore, facts indicated by terms such as ‘good’, ‘poor’ are not statistics unless a numerical equivalent, is assigned to each expression. Also, this may either -be enumerated or estimated, where actual enumeration is either not possible or is very difficult. BUSINESS DATA ANALYSIS IIT SEMESTER B.COM |34. Statistics are numerated or estimated according to reasonable standard of accuracy: Personal bias and prejudices of the enumerator shonld not enter into the counting or estimation of figures, otherwise conclusions drawn would not be accurate. The figures should be counted or estimated according to reasonable standards of accuracy. Absolute accuracy is neither necessary nor sometimes possible in social sciences. But whatever standard of accuracy is adopted once, should be used throughout the process of collection or estimation, 5. Statistics should be collected in a systematic manner for a predetermined purpose: The statistical methods to be used for the purpose of enquiry should be predetermined'since figures are always collected with soine purpose. The data should be collected in a systematic manner through some suitable plan. Otherwise there will be waste of time, energy and money. The purpose of data collection must be decided in advance and the investigator must be aware of the purpose otherwise he may collect unnecessary data which may not be of any Se. For example, when income details are collected from high income’ group ignoring the middle income or lower income group, it will only inflate national income data. 6. Statistics should be capable of being placed in relation to each other: The collecteddigure should be comparable and well-connected in the same departmenit of inquiry. Data should be homogeneous or they should relate to the same phenomenon or subject. For example, Ages of husbands are to be compared only with the corresponding ages of wives, and not with, say, heights of trees. Functions of Statistics The functions of statistics may be enumerated as follows: () To present facts in a definite form: We can represent the things in their true form with the help of figures. Without a statistical study, our ideas would be vague and indefinite. The facts are to be given in a definite form. If the results are given in numbers, then they are more convincing than if the results are expressed on the basis of quality. Statements like, there is lot of unemployment in India or population is increasing at a faster rate are not in the definite form. The statements 4 | BUSINESS DATA ANALYSIS IIT SEMESTER B.COM) (ii) (iv) should be in definite form like the population in 2004 would be 15% more as compared to 1990. To simplify unwieldy and complex data (Precision to the Facts): Statistics helps in simplifying complex data to simple form-to make them understandable. It is not easy to treat large numbers and hence they are simplified either by taking a few figures to serve as a representative sample or by taking average to give a bird’s eye view of the large masses. For example, complex data may be simplified by presenting them in the form of a table, graph or diagram, or representing it through an average etc. To use it as a technique for making comparisons (Comparisons): The significance of certain figures can be better appreciated when they are compared with others of the same type)The comparison between two different groups is best represented by certain statistical methods, such’ as average, coefficients, rates, ratios, etc. Comparison is one of the main functions of statistics as the absolute figures convey a very less meaning. To enlarge individual experience (It Enlarges Knowledge): An individual’s knowledge is limited to what he can see and observe; and that is a very small part of the social organism. His knowledge is extended’in various ways by studying certain conclusions and results, the basis ‘of which are numerical: investigations. When a person goes through various procedures. of statistics, it widens his knowledge pattern. It also widens his thinking and reasoning power and helps him to reach a rational conclusion. For example, we all have general impression that the cost of living has increased. But to know to what extent there is an increase, and how far the rise in prices has affected different income groups, it would be necessary to ascertain the rise in prices of articles consumed by them. To provide guidance in the formulation of policies (Policy Making): The purpose of statistics is to enable correct decisions, whether they are taken by a businessman or Government. In fact, statistics is a great servant of business in management, governance and development. Sampling methods are employed in industry in tackling the problem of standardisation of products. Big. business houses maintain a separate department for statistical intelligence, the work of which is to collect, BUSINESS DATA ANALYSIS I] SEMESTER B.COM |(vi) (vii) (viii) (ix) compare and coordinate figures for formulating future policies of the firm regarding production and sales. To enable measurement of the magnitude of a phenomenon: But for the development of statistical science, it would not be possible to estimate the population of a country or to know the quantity of wheat, rice and other agricultural commodities produced in the country during any year. To formulate and test hypothesis: Statistical methods help in formulating and testing the hypothesis or a new theory. With the help of statistical techniques, we can know the effect of imposing tax on the exports of tea or on the consumption of ted in other countries. Another example could be, to study whethergeredit squeeze is effective in checking inflation or not. Forecasting: Statistics is not only concerned with, the above functions, but it also predicts the future course of action of the»phenomena. We can make future policies baséd on estimates made with the help of Statistics. We can predict the demand for goods in 2005 if we know the population in 2004 on the basis of growth rate of population in past. Similarly, a businessman ‘can. exploit) the market situation in a successful manner if he knows) about the trends in the market. Thus, statistics help in shaping future policies To measure uncertainty: Future is uncertain, but statistics help the various authorities in all the phenomenon of the world to make correct estimation by taking and analysing the various data of the part. So, uncertainty could be-decreased. As we have to make a forecast, we also have to create trend behaviours of the past, for which we use techniques like regression, interpolation and time series analysis. Importance of Statistics ‘These days statistical methods are applicable everywhere. There is no field of work in which statistical methods are not applied. According to A L. Bowley, “A knowledge of statistics is like a knowledge of foreign languages or of algebra, it may prove of use at any time under any circumstances”. The importance of statistical science is increasing in almost all spheres of knowledge, e.g., astronomy, biology, meteorology, demography, economics 6 | BUSINESS DATA ANALYSIS II SEMESTER B.COMand mathematics. Economic planning without statistics is bound to be bascless. Statistics serve in administration and facilitate the work of formulation of new policies. Financial institutions and investors utilise statistical data to summaries the past experience. Statistics are also helpful to an auditor, when he uses sampling techniques or test checking to audit the accounts of his client. Scope and Importance of Statistics 1. Statistics and Planning: Statistics is indispensable to planning in the modern age which is termed as “the age of planning”. Almost all over the world governments are depending on statistical data to plan their economic development. 2. Statistics and Economies: In economies research, statistical methods are used to collect and analyse the data and test hypotheses. The relationship between supply and demand is studied by statistical methods. Imports and exports, inflation rates and per-Capita income are problems which require a good knowledge of statisti¢s. Econometrics is a relatively new branch developed after Second World War. Increasing inter-relationship between, mathematics, economics and statistics led to the development of Econometrics. This new subject is dependent on Mathematical techniques, Statistical methods and Economic theory. Econometric models based: on sound statistical analysis are used for maximum exploitation of the available resources. 3. Statistics and Business: Statistics play an important role in business. A successful businéssman’must be very quick and accurate in decision making. Statistics helps businessman to plan production according to the taste of the customers, the quality of the products can also be checked more efficiently by using statistical methods. So, all the activities of the businessman will be based on statistical information. He can make correct decision about the location of business, marketing of the products, financial resources etc. 4. Statistics and Industry: Statistical concepts and methods are developed and applied in industries for various problems — for example, in order to monitor the quality of products, to plan effective and efficient designs to improve standards, to test and analyse the quality of items produced and to BUSINESS DATA ANALYSIS IIT SEMESTER B.COM |7accept or reject conforming (nonconforming) units produced. The increased attention paid to these problems and accompanying new statistical methodologies, has created an active and valuable new area of research and application in industrial statistics. 5. Statistics and Mathematics: Statistics is a branch of applied mathematics. ‘A large number of statistical methods like probability, averages, dispersions estimation etc., is used in mathematics, and different techniques of pure mathematics like integration, differentiation and algebra are used in statistics 6. Statistics and Modern Science: In medical, science, statistics is the science of summarizing, collecting, presenting “and interpreting data in medical practice, and using them to estimate the magnitude of associations and test hypotheses. It has a central role'in medical investigations. 7. Statistics, Psychology and Education: In education and psychology statistics has found wide application such as, determining”or to determine the reliability and validity toa test, factor analysis etc. 8. Statistics and War: In war, the theory of decision function can be a great assistance to the military personnel to plan “maximum destruction with minimum effort.” Statistics in Business and Management 1. Marketing: Statistics/are applied in marketing to identify market trends, and lo measure and evaluate the potential and success of marketing programs. ‘The secret to, successful marketing is to identify the target market accurately and'to use effective marketing communication channels and tactics to reach it. 2. Production: In the field of production, statistical data and method play a very important role. The decision about what to produce? How to produce? When to produce? For whom to produce is based largely on statistical analysis. 3. Finance: Statistics plays a leading role in finance. Statistical analysis has become a powerful tool for better market valuation, taking a leading role in development of new financial products ete. 8 | BUSINESS DATA ANALYSIS II] SEMESTER 8 COM4, Banking: Banking institutions have found it important to establish research departments within their organization for the purpose of gathering and analysis of information, not only regarding their own business but also regarding general economic situation and every segment of business in which they may have interest. 5. Investment: Statistics greatly assists investors in making clear and valued judgment in their investment decisions in selecting securities which are safe and have the best prospects of yielding a good income. 6. Purchase: The purchase department in discharging its function makes use of statistical data to frame suitable purchase policies such as what to buy? ‘What quantity to buy? What time to buy? Where*to buy? From whom to buy? 7. Accounting and Auditing: In accounting precision of facts is important. But for decision making purposes, exactness or precision is not always essential; decisions may be taken based on approximation. In accounting, Statistical techniques such as corfelation analysis, trend analysis are used to find future trend. In auditing sampling techniques are used commonly. Large volume of transactions cannot be audited due to limitation of resources such as men, money, time etc. Anjauditor may look into the rate of error in the past years, conduct @ pilot audit to find new rate of error and on the basis 6f this, determines the sample size of the books to be audited. 8. Control: The management control process combines statistical and accounting methods in making the overall budget for the coming year including sales, materials, labour and other costs and net profits and capital requirements. IS STATISTICS A SCIENCE OR AN ART? In order to know whether Statistics is a science or art or both, it is necessary to understand the meaning of science and art. According to Webster’s dictionary Science is defined as “Accumulated and accepted knowledge that has been systematised and formulated with reference to the discovery of general truths or operation of definite laws”. In shoit, Science refers to a systematized body of knowledge, It studies cause and effect relationship and attempts to make generalization in the form of science principles or laws. It only describes what facts are. —_ BUSINESS DATA ANALYSIS JIT SEMESTER B.COM |9According to Karl Pearson, that knowledge which a) Gives mental education to the citizens b) Throws light on important social problems, c) Gives happiness in practical life and d) Gives satisfaction to our artistic faculties, may be called as science. Since statistics possesses these qualities, it is regarded as Science. However, statistics is not a science like physics, chemistry or economics and sociology. It may be called a Science of scientific methods. Statistical knowledge is not for its own sake but for the sake of other knowledge’s. This is the basic difference between science of statistics and other sciences. According to Tippet, “As a science, the statistical method is a part of the general scientific method and is based on the same fundamental ideas and processes.” Art is a practical science. If science is knowledge, then art is action. Art has the following characteristics a) Artis a group of actions to solve a problem. b) Art does not describe facts, but it examines merits and demerits and guides the way to achieve the objectives: c) Art (artists) possess special skill, experience and restraint. By science we know a thing and by art we do that thing. Statistics is regarded as an art of applying the science of scientific methods. Statistics is the science of collecting, organizing, presenting, analysing, and interpreting numerical data for the purpose of assisting in making a more effective decision. Art, on the other hand, refers to the skill of handling facts so as to achieve a given objective. It is concerned with ways and means of presenting and handling data, making inferences logically and drawing relevant conclusions. Thus, statistics may be regarded as a science of scientific methods and art is of applying those methods. Limitations of Statistics The scope of the science of statistics is restricted by certain limitations: 1. The use of statistics is limited to numerical studies (Qualitative aspect ignored): Statistical methods cannot be applied to study the nature of all 10 | BUSINESS DATA ANALYSIS JI SEMESTER B. COMtype of phenomena. Statistics deal with only such phenomena as are capable of being quantitatively measured and numerically expressed. For example, the health, poverty and intelligence of a group of individuals, cannot be quantitatively measured, and thus are not suitable subjects for statistical study. Deals only with aggregate of facts (It does not deal with individual items): Statistical methods deal with population or aggregate of individuals rather than with individuals. When we say that the average height of an Indian is 1 metre 80 centimetres, it shows the height not of. an individual but as found by the study of all individuals. |. Statistics relies on estimates and approximations: Statistical laws are not exact laws like mathematical or cheinical laws. They are derived by taking majority of cases and are not true for every individual. Thus, statistical inferences are uncertain . Misleading conclusions: Statistical results might lead to fallacious conclusions by deliberate manipulation of figures and unscientific handling. This is sof because’ statistical results are represented by figures, which are'liabléto be manipulated. Also, the data placed in the hands of an expert may: lead to fallacious results. The figures may be stated without their context or may be applied to a fact other than the one to which they really relate. An interesting example is a survey made some years ago which reported that 33% of all the girl students at John Hopkins University had married University teachers. Whereas the University had only three girl students at that time and one.of them married to a teacher. . It does not depict entire story or phenomenon: When any phenomena occur, it is due to many causes, but all these causes cannot be expressed. in terms of numbers. So, we cannot reach at the right conclusion. Development of a group depends upon many social factors like, parents’ economic condition, education, culture, region, administration by government etc. But all these factors cannot be presented in the form of data. Hence, we can analyse only that data which is quantitative and not qualitative in nature. Therefore, results or conclusions are not 100% accurate as many aspects may be ignored. BUSINESS DATA ANALYSIS IJ SEMESTER B.COM | 116. It is liable to be misused: As W.I. King points out, “One of the short- comings of statistics is that they do not bear on their face the label of their quality.” The data and procedures of its approaching to conclusions may be checked but the data may have been collected by inexperienced persons or they may have been dishonest or biased. As it is a delicate science and can be easily misused by unscrupulous persons, data must be used with caution. Otherwise results may prove to be disastrous. 7. Laws are not exact: There are two fundamental laws concerned with statistics: a. Law of Inertia of Large Numbers b. Law of Statistical Regularity. Statistical laws are not as good as Science laws. They,are based on probability. So, these results will not always be as good:as that of scientific laws. On the basis of probability or interpolation, we can only estimate.the production of paddy in 2008 but cannot make.a claim that it would be exactly 100%. Here only approximations are made: 8. Results are true only>on average? In statistics, the results are interpolated for which time series or regression or probability can be used. These. are not absolutely. true! If average of two sections of students’ in Accountancy is same, it does not mean that all the 50 students is section A has got same marks as in B. There may be much variation between the two. So, we get average results. “Statistics largely dealg with averages and these averages may be made up of individual items radically different from each other.” —W.I. King 9. Too Many methods to study problems: In Statistics, many methods are used to find a single result. Variation can be found by quartile deviation, mean deviation or standard deviations and results vary in each case. “It must not be assumed that the statistics is the only method to use in research, neither should this method of considered the best attack for the problem.” —Croxton and Cowden. 10. Statistical results are not always beyond doubt: “Statistics deals only with measurable aspects of things and therefore, can seldom give the 12 | BUSINESS DATA ANALYSIS IT SEMESTER R.COMcomplete solution to problem. They provide a basis for judgement but not the whole judgment.” —Prof. L.R. Connor Although many laws and formulae are used in statistics, the results achieved are not final and conclusive. Since the results cannot to give complete solution to a problem, they must be taken and used with much wisdom. Distrust of Statistics Due to limitations of statistics an attitude of distrust towards it has been developed. There are some people who place statistics in the category of lying and maintain that, “there are three degrees of comparison in lying-lies, dammed lies and statistics”. But this attitude is not correct. The person who is handling statistics may be a liar or inexperienced. But that would be the fault not of statistics but of the person handling them. The person using statistics should not take them at their face value. He should check the result from an independent source. Also, only expérts should handle statistics otherwise it may beymisused. It may be noted that the distrust of statistics is due more to insufficiency»of knowledge regarding the nature, limitations and uses of statistics than to any ‘fundamental inadequacy in the science of statistics. Medicines are meant for curing people, but if they are unscientifically handled by quacks, they may prove fatal to the patient. In both the cases, the medicine is the same; but its useful@ss’or harmfulness depends upon the man who handles il. Medicine cannot be blamed for such a result. Similarly, if a child cuts his finger with a sharp knife, it is not the knife that is to be blamed, but the person who kept the knife at a place that the child could reach it. These examples help us in emphasising that if statistical facts are misused by some people it would be wrong to blame the statistics as such. It is the people who are to be blamed. In fact, statistic is like clay which can be moulded in any way. Statistical Investigation Generally, ‘investigation’ or ‘inquiry’ means a search of knowledge. Statistical investigation means search for knowledge with the help of statistical methods. Statistical investigation or enquiry means an investigation conducted by an individual agency wherein relevant information is collected in quantitative terms. Statistical investigation depends on data therefore it includes scientific BUSINESS DATA ANALYSIS Ji SEMESTER B.COM |13and systematic collection of data and their analysis with the help of various statistical methods and their interpretation so as to throw light on some problems. A study of characteristics of units of a population by using statistical devices and techniques is called Statistical Investigation The Statistical Investigations may be: 1. To prove a newly formed theory concerning a population. 2. To know the existing nature of population. 3. To formulate a new theory concerning the population. Stages of Statistical Investigation A Statistical Investigation is mainly conducted‘in two stages: 1. Planning and Preparation 2. Execution of the survey 1. Planning and preparation: In’a statistical survey, the planning and preparation stage is of great importance. Here, every feature of the survey is carefully chalked out so that difficulties do not arise in the course of execution. The following factors are to be considered: a. Purpose of the survey: A clear statement regarding the purpose of the suryey should’be, prepared so that every aspect of the survey can be properly planned. b. Scope of the survey: The scope with regard to the geographical coverage and the details of information required for the study should be decided. f ~ Preparation of Frame: Frame isthe listyof addresses or any other specification of the individuals (units) in the population. Frame should be prepared such that every individual in th@,population can be identified and approached: c d. ‘Type of the survey;/The investigator may adopt Census enumeration or go for Sample survey. Depending upon the facilities available such as resources, time and labour, one may decide on the type of the survey 14 | BUSINESS DTA ANALYSIS II SEMESTER COMe. Type of the data to be collected: The investigator should decide whether he should base his survey on primary data or on secondary data. Primary data would be better because they are collected for the purpose and are fresh, complete and accurate. f. Statistical characteristics, units are being used. The units are of two types: its fo he used: While counting or measuring various i, Units of colleetion: Used for counting or measurement during collection of data. ii, Units of analysis: Used while analysing the collected data. They are rates, ratios, percentages etc, g. Degree of accuracy desired: The degreeof accuracy is to be decided. It is necessary to maintain some level of accuracy for estimation of results, 2. Execution of the survey: After planning and making all the preparation for the survey, the survey is tobe executed. Execution has four steps: a. Collection of data: The validity of statistical inferences depends mainly on which they are based..Thus, data should be collected with utmost care. b. Scrutiny, editing and presentation of data: The collected data shouldbe scrutinized for reliability, consistency and completeness. The Volume of collected data is reduced by systematically arranging them inthe form of table. The tabulated data may be represented by diagrams and graphs ¢. Analysis of data: The data is analysed by using statistical devices and techniques. Statistical constants like averages, measures of variation, correlation, trend etc are derived d. Interpretation of analysed data: The final decisions are based on the analysed facts. Based on these facts, inferences are carefully drawn. Regarding the final conclusion, a report should be prepared. Collection of Data Collection of data means the methods that are employed for getting the required information from the units under investigation. The method of Collection of data depends upon the nature, object and scope of enquiry on one hand and on availability of money and time on the other hand. BUSINESS DATA ANALYSIS I] SEMESTER B.COM [15Definition: 1. Data Collection is the process by which the researcher collects the information from all the relevant sources to find answers to the research problem, test the hypothesis and evaluate the outcomes. 2. The process of counting or enumerating and recording the same systematically is called “Collection of Data”. Techniques of Data Collection: Statistical data are generally collected for the purpose of analysis and interpretation by the use of statistical techniques. Data may be collected in one of the two ways 1. By taking a ‘Census’ in which each and every item of the population is studied or 2. By taking a ‘Sample’ of the population under investigation and then making conclusions based on sample study. Population: Universe or Population consists of total.collection of items and elements that fall within the scope of a’statistical inivestigation. According to G. Kalton, in statistics, the term poptilation does not necessarily refer to people but is a technical term used. to describe the complete’groups of persons or objects for which the results are-to apply. In simple words, the aggregate of all items which come under the definition of investigation unit is called Universe or Population 1. Census Enumeration: If the investigation is based on the population as a whole, it 1s called‘Gensus enumeration. In the census method of collection of data, every unit of the population/universe is included in the subject matter under investigation. Census investigation is also called as Complete Count. This technique is suitable when the scope of enquiry is limited, population contains units having different characteristics, in-depth study of each unit is required, sufficient resources are available with the researcher and when greater accuracy is expected. Merits: a) Itis free of sampling errors. b) For a small population where the units can be easily contacted, it is preferable. 16 [BUSINESS DATA ANALYSIS IJ SEMESTER B.COMc) Results obtained by this method would be accurate and reliable. d) In this method, statistical analysis of the data is much simpler than in sample survey. Demerits 1. Non-sampling errors likely to be more in this method. 2. For large populations, collection of data by this method becomes costly, time consuming and it requires more labour. 3. When population is hypothetical, this method is not possible. 4. While procuring the data if the units are damaged, census enumeration caumul be conducted. 5. This method cannot be used when population is infinite or complex. 2. Sample Survey: Sampling is the seléction of a part of a whole (the universe/population) for the purpose of drawing)conclusions about the entire universe from the study of the part. Under, this method, some representative units are selected, and a detailed study is‘then made. The results derived from sampleénquities can be as good as the results obtained for the whole universe, provided: proper care is taken in selecting the sample, . Merits ¢ 1. It is more scientific. e 2. Itis cheaper than census method. 3. It consumes less time and labour. 4, Results of sumple survey are more yalid andjyeliable provided it is well- planned.and conducted scientifically, 5. When the population is large sample survey is preferable. 6. When population is hypothetical this method is adopted. Non-sampling errors éan be reduced, considerably by taking proper precautions. Demerits e 1. It requires’adoption of appropriate”sampling method and appropriate methods of analysis. 2. Sampling crrors af€ part and parcel of sample survey. 9 BUSINESS DATA ANALYSIS /i/ SEMESTER B.COM |173. In this method, intensive statistical analysis is required because results are reached by induction. 4, If results with highest accuracy are essential, this method is not preferable. ‘Vechniques ot sampling The sampling techniques can be: 1. Probability Random Sampling. 2. Non-Probability Sampling. 1. Probability or Random Sampling: It is basethon theory of probability where in cach and every element has chance of being included in the sample. The following are different random sampling techniques: a. Simple Random Sampling: Simple random sampling is the one in which each element has équal chance of being included in the sample. b. Stratified sampling: In this type of sampling, population is subdivided into homogéneots groups called strata and from each stratum random sample is drawn, c. Systematicrandom sampling: In this type of sampling, only the first unit is selected randomly, and the remaining units of sample are selected at fixed intervals. d. Cluster sampling: Cluster samplisig involves grouping the population and then selecting the cluster randomly. e. Area sampling: In area sampling clusters are formed on geographic basis like sectors, blocks, states cte. f. Multi-stage sampling: As the hame suggests, the sampling procedure is carried out in several stages. g. Sequential sampling: It is a Sample,design where the ultimate size of the sample®not fixed in advance but is determined according to mathematical decision on basis of information yielded as survey progress: 18 | BUSINESS DATA ANALY IS JI SEMESTER R.COM2. Non-probability sampling: Non-probability sampling are those which are not based on the Theory of Probability. It includes the following techniques: a. Accidental sampling: It is a sampling under which the samples are selected at the convenience of the investigator. b. Purposive sampling: It is a deliberate sampling method wherein the investigator exercises his judgement in selecting the units of sample. ¢. Quota sampling: In this method, homogeneous groups are created, and a quota of sample size is fixed for selection. The investigator is then asked to collect the information from certain.number of units which constitutes his quota, Differences between Census and Sample Survey ae Census Method Sampling Method comparison ‘A 1. Meaning A. systematic. method that} Sampling refers to a collécts. and records the | portion of the population data about the members of | selected to represent the the population is called entire group, in all its Census. characteristics 2. Enumeration _ | Complete Partial 3. Study of Each and every unitofthe | Only a handful of) population, representative units of the population. 4, Timerequired [It cis a time-consuming | Itisa fast process. process. 5. Cost Expensive method Economical method 6. Results Reliable and accurate Less reliable and accurate, duc to the margin of error in the data collected, 7. Error Not present. Depends on the size of the population 8. Appropriate | Population of Population of For heterogeneous nature. homogeneous nature. BUSINESS DATA ANALYSIG IJ SEMESTER D.COM |19Types of Data a) Primary Data: Primary data are the fresh data collected directly from the field. They are first hand data. The sources of collecting the primary data are: a. Direct personal observation: Investigators themselves go to the field personally, observe, and collect the information from the respondents. ‘They are reliable. The investigator can use his skill in extracting accurate data from units. However, it is expensive and time consuming. In this method, there is scope of bias also b. Personal interview method: In this method, the investigator personally interviews the respondents. and. extracts the required information from them. Data collected. by this method is reliable, accurate and exhaustive. It does mot require the respondents to be educated. Additional information of interest may also be collected. However, it requires more time and labour and is expensive especially when the respondents are/spread over a vast geographical area. c. Information through Correspondents: Investigators appoint local agents or correspondents in different,parts of the area to collect the data. The local agents collect the information and sent their reports periodically to the investigators. The/validity of data collected by this methodsdepends mainly on the’ integrity of the correspondents. However, in this method, there is scope of bias. d. Method of Questionnaire: Questionnaire is a list of questions, answers ‘for which ure (o be filled in Ly the informants and these answers are“the required information for the investigation. This method is useful when the area under investigation is vast and it is inexpensive. However, data obtained by this method may not be accurate. The non-response rate is also high. It cannot be adopted if the respondents are illiterates. e. Method of Schedule: ‘Schedule’ is a printed list of sample questions. It is sent to the respondents through enumerators. The enumerators discuss personally with the respondents and record their answers in the schedule. This method is especially usefull when the informants are illiterate, and they are spread over the vast area. However, it requires extensive training of the enumerators. There is scope of bias also. 20 | BUSINESS DATA ANALYSIS IIT SEMESTER B.COMMerits of Primary data: 1. Degree of accuracy is quite high. 2. It does not require extra caution. 3. It depicts the data in great detail. 4, The data is complete, reliable and fresh. Demerits of Primary data: 1. They are costly. 2. Their collection consumes more time and labour. 3. If the population is vast, it is not preferable. 2. Secondary data: The data which has already been collected by someone else are called Secondary data. It is the data which is not directly collected from the field but borrowed from others who have collected them for some other purpose. Published sources: a. Reports and publications of Central and State government departments. b. Reports of Committees and Commissions c. Publication and Reports of Trade Associations and Chambers of Commerce. = |. Magazitiés, Journals and newspapers. Research work done by scholars in Universities and Institutions. Publications of International Bodies: . Market reviews and reports, rm moe . Articles published by distinguished authorities on the subject. i. Websites of various organizations on the internet etc. Unpublished sources: a. Records maintained by goverment offices, municipal offices. b. Records‘maintained by research ifstitutions, research scholars, ete. Merits of Secondary. data: 1. Secondary data are cheap. 2. Collection of Secondary data consumes less time and labour than collection of primary data. BUSINESS DATA ANALYSIS IIT SEMESTER B.COM |21Demerits of Secondary data: 1. They may not contain all the required information, as it is collected from others for some other purpose. 2. The degree of accuracy may be different. 3. The reliability of source and validity of the data should be verified. Classification of data “Classification of data” is a process of arranging data into sequences and groups or classes according to their attributes or characteristics. It refers to sorting out of a heterogeneous mass data into a number of homogeneous groups and subgroups. Objectives The main objective of classification is to eliminate unnecessary details of the data and to bring in the uniformity in their attributes within the diversity. The other objectives are: 1. To convert the raw data into aorganized data. 2. To present the complexdata into simple form. 3. To bring out similarity and dissimilarity in the items. 4, To bring in uniformity of facts. 5. To facilitate for comparative study between the two items. 6. To establish relationship between the two series. 7. To present the data in a condensed form. 1. It condenses ‘the huge unwieldy data into a readily comprehensive form. 2. Ttenables us to make meaningful comparison between the. two items 3. Itestablishes relationships among the two or more related series. It introduces uniformity in the midst of diversity that makes the data intelligible, useful and ready for analysis and interpretation. 22 | BUSINESS DATA ANALYSIS III SEMESTER B.COMTypes of Classification Bases of Classification a Qualitative Quantitative (@escriptive, Attributes) (Numerical, Variables) I Simple Composite Arbitrary Discrete Continuous (Two-fold) (Manifold) (Notional) _(Integers) (Fractional) 1. In Qualitative Classification, data are classified according to attributes or characteristics or qualities. Generally, the qualitative phenomena are not measurable, However, they can be studied with reference to their presence or absence like educated and, uneducated etc. ‘Simple’ classification involves only two attributés as the basis. ‘Composite’ classification involves more than two “ttributes as the bases. ‘Arbitrary’ classification refers. to the attributés which aré not clearly defined and in which no demarcation can be made. The attribute should be clearly defined before the classification is made. 2. In Quantitative Classification, data are classified according to quantities that are measurable such as age, marks price, wages etc. A variable is a factor which Varies and assumes any numerical value within a particular runge. ‘Diserete? variable takes only integers or whole numbers such as 1,5,12,20 so on. Itdoes not take fractional values. ‘Continuous’ variable takes all the possible values, integers’ and fractions as well such as 1.1, 26.1, 282.010 Frequency Distribution: Frequency is concerned with the number of times each value of a variable occurs in the series. It refers to the number of repetitions of a particular value of variable. A. systematic presentation of the values taken by a variable and the corresponding frequencies is called Frequency Distribution of that variable. A tabular presentation of frequency distribution is called Frequency Table. BUSINESS DATA ANALYSIS IIT SEMESTER B.COM |23Basically, frequency distribution can be of two kinds: 1. Univariate Frequency Distribution 2. Bivariate Frequency Distribution Again, Univariate Frequency distribution is of 3 types: 1. Individual Observation or Individual Series 2. Discrete Series 3. Continuous Series 1. Individual Observation: It is an arrangement of raw data in the order of magnitude (ascending or descending). In other, words, it is the listing of items singly after observations as different fromlisting them in groups. ‘This method of presenting data is suitable“where the data collected is not large in size. Example 1: Roll No: Marks 40 0] 20] afore] & [Oo] — 4 EF 3 Bw a Marks arranged in Ascending Order 27, 33, 38, 39, 40, 41, 44, 48, 51, 58 Marks arranged in Descending Order 58, 51, 48, 44, 41, 40, 39, 38, 33, 27 2. Discrete Series: In a Discrete series, the data are presented in a way that exact measurements of units are clearly indicated. There is definite difference between the variables of different groups of items. Every class is distinct and separate from the other classes. There is no continuity from one group to another. 24 | BUSINESS DATA ANALYSIS II SEMESTER B.COMFormation of a Discrete Frequency Distribution A table with three headings, viz., variable, tally-bars and frequency is to be formed, All possible values of vatiables should be placed in fist column, Vertical bar (I) called tally-mark is put against the number in second column, After a particular value has occurred four times, for fifth occurrence we put a cross tally- mark (IIII) cutting first four marks to give a block of 5. Finally, we count the number of bars corresponding to each value of variable and place it in the last column. 2. Consider the marks scored by 30 students: gare thar taeda fOr Ot 6-65 9 TR a SRE gs 74 9-4 LIB WO SE MG gS Form frequency distribution. Solution: Explanation: First we should note'the lowest and highest values and place all possible values in first column. A tally mark is put against each number whenever it occurs. Marks [ally bars | Frequency 0 oT I I T I 2 ie T 3 Tr 2 4 ll 3 5 a 5 6 Ht 5 7 Ti 3 8 Tl 3 9 He 5 10 I I 3. Continuous Series: A frequency distribution in which class intervals are considered is a Continuous or Grouped Frequency Distribution. Values of variable are grouped or continuous and they not only take integers but also fraction in this series. Further these values of variable are large in size along with the huge number of observations. The entire range of values of variable are grouped into suitable classes. BUSINESS DATA ANALYSIS JI SEMESTER B.COM |25Terms used In Continuous Series 1. Class Interval is the size of each class or group in which the values of variable are classified with the purpose of condensing the data. 2. Class Limits are two end values of a class interval when the values of variable take integers. The small limit is called a ‘Lower limit’ and the larger limit is called an ‘Upper limit’ 3. Class Width is the difference between the lower limit and upper limit of class intervals. 4, Class Mid-Value is the central value of the class interval. It is the average of the class limits. Upper limit of a class“ Lower limit of a class 2 Mid value of a class 5. Class frequency is the number of the observations corresponding to the specific class. It is the rate of occurrence of a particular event or value relating to a particular class. 6. Cumulative frequency is the running total of all the frequencies up to and including the respective class interval when the class intervals are in ascending or descending order of Values. 7. Less than Cumulative Frequency are running totals of the frequencies downward starting from the first frequency. 8. More than Cumulative Frequency are running totals of the frequencies upward starting fromthe Jast frequency. Inclusive and Exclusive Class Intervals If class interval is such/that the lower as well as the upper-class limits are included in the same class interval, it is Inclusive Class Interval. If a class interval is such that the lower-class limit is included in the same class interval, whereas, the upper-class limit is included in the succeeding class interval, it is Exclusive Class Interval Conversion of Inclusive Class Interval to Exclusive Class Interval The number of classes, in general, should be minimum 5 and maximum 15. The width or magnitude should be cither 5 or ils mulliples (10,15,20 and so on). It is advised to convert inclusive class interval to external class interval as follows: 26 | BUSINESS DATA ANALYSIS JIT SEMESTER B.COMCorrection factor is deducted from lower limits and added to the upper limits. Where, Lower limit of succeeding class ~ Upper limit of preceeding class correction factor = 2 3. Marks scored by 30 students are given below 42 56 49 48 54 49 34 33 43 56 45 39 60 66 72 80 42 54 48 49 56 20 32 35 43 52 36 36 27 26 Convert the marks into a continuous series of a class-interval of 10 Solution: Explanation: Identify the lowest and highest marks, Since lowest marks is 20 and width being 10, the first class interval may be 80-90. As it is exclusive class interval the marks 80 lies in 80-90, 60 lies in 60-70 and 20 lies in 20-30. Marks (C-)_| Tally-Marks | Frequency 10-20 am - 20-30 ef 0 3 30~40 HEIL 7 40 50 dt an 10 50 = 60. HHL 60-70 I 2 7080 1 1 80-90 1 1 N=30 4, Form a continuous frequency table. The marks scored by 50 students in an examination are given below, taking class interval of 10 — 20, 20 — 30 ete. 48, 30, 31, 39, 18, 54, 33, 10, 29, 62, 38, 41, 43, 51, 37, 71, 62 34, 55, 29, 43, 64, 43, 52, 64, 44, 55, 45, 22, 32, 21, 59, 61, 22 74, 19, 46, 73, 33, 85, 85, 51, 63, 58, 27, 44, 32, 31, 47, 18 (May 2017) BUSINESS DATA ANALYSIS JIT SEMESTER B.COM |27Solution: Marks (C-l)| ‘Tally | Frequency Marks 10-20 Mi 4 20-30 HT 6 30-40 WT u 40-50 AWE 10 50-60 wl 8 60-70 WT 6 70-80 tl 3 80-90 tl 2 N=50 5. a) Makea frequency distribution with intervals of 10 from the following data. b) Also prepare less than cumulative frequency distribution. c) And prepare more than cumulative frequency distribution. 40, 38, 45, 59, 83, 90,94, 76, 68.87, 43, 59, 36, 65, 86, 95, 73, 57 58, 65, 41, 45, 61, 45, 90, 84, 89, 74,75, 47, 55, 66, 81, 87, 97 69, 67,71, 85, 80 Solution: a) Frequency Distribution Marks (C-1) | Tally — Marks | Frequency 30-40 tl 2 40-50 WHT 7 50-60 ‘Ss 60-70 wil 1 70-80 Ww 5 80-90 el 9 90-100 Wh 5 Total (N) = 40 28 | BUSINESS DATA ANALYSIS III SEMESTER B.COMb. Less than Cumulative Frequency Distribution. Explanation: Upper limits of class intervals are considered to make open ended class interval here and frequencies are added from first, Marks Cumulative Frequency Less than 40 2 Less than 50 9a) Less than 60 14 (24745) Less than 70 21 (+745) ‘Less than 80 26 (2474547) Less than 90 35 (24795479) Less than 100. | 40. + 745+7+945) c. More than Cumulative Frequency Distribution — Explanation ; Lower;limits of class intervals are considered to make open ended class interval.and frequencies are added from last. Marks ‘Cumulative Frequency More than 30 40 More than 40 (40-2) 38 More thaii50 (40-2-7) 31 More than 60. (40-2-7-5) 26 More than 70 (0-2-7571) 19 More than 80 (40-2-7-5-7-5) 14 ‘More than 90 (40-2-7-5-7-5-9) 5 6. Present the following data of the percentage marks of 60 students in the form of frequency table with 10 classes of equal width, one class being 50 —59. 41 17 83 63 54 92 60 58 70 06 67 82 33 44 57 49 34 73 54 63 36 52 32.75 60 33 09 72 28 30 42 93 43 80 03 32 57 67 24 64 63-11 35 82 10 23 00 41 60 32 72 52 92 88 62 55 60 33 40 57 BUSINESS DATA ANALYSIS IIT SEMESTER B.COM |29Marks (C-l) | Tally—Bars | Frequency 0-9 Ml 4 10-19 il 3 20-29 Ml 3 30-39 a 10 40-49 WHI f 50-50 HHMI 9 60-69 HHH u 70-79 at 5 80-89 a 5 90-99 Mi 3 Total (N)= 60 Bivariate Frequency Distributions: A frequency table where two variables have been measuredtin’the same set of items through cross classification is known as Bivariate Frequency Distribution or Two-way Frequency Distribution. Presentation of data “Data presentation” is an act of organising the ¢ollected data into tables, graphs or charts so that“logical and statistical conclusion can be derived from the collected data. Tabulation of Data An arrangement of classified data in tabular formyis*called Tabulation. It is a systematic arrangement:of Classified data into“fows and columns of a table. According to Tuttle, “A statistical tablegis thélogical listing of related quantitative data in vertical columns and ‘horizontaljrows of numbers with sufficient explanatory and qualifying words, phrases and Statements in the form of titles, louting and footnotes toymake clear the full mene of the data and their origin.” Importance of table a. Tabulation enables the classified.data to be studied/understood easily. b. The bulky data presented in a tabular form helps us to draw conclusions at a glance without taking much time and energy. 30 | BUSINESS Da ui) SEMESTER B.COMc. The tabulation of data can be easily visualized along with comparative study of different types of data Contents or Parts of Table A good statistical table should contain the following components: a. Table number: A table should always be numbered for easy identification and reference in future. b. Title of Table: A table must have a suitable title. Title is description of the contents of the table. c. The table should be suitably divided into rows and columns according to the nature of data and purpose. d. There should be Captions (box head), which refer to the column headings vertically at the extreme.fop. A caption explains what the column represents. e. There should Stubs, which refer to the row headings*hotizontally at the extreme left. A stub explains what the row represents. f. The table has Body..The body of the table contains the numerical information. g. There should be columns ‘subtotal, rows subtotal and grand total for all the concerned. h. There should be Head notes, which is a brief explanatory statement applying to all or a major part of the materials in the table. i. There should be Footnotes, which arc directly placed below the body of the table. They are used to mention as explwaliuus for sume umbiguous terms used in the table. j. There should be Source notes, which are also placed directly below the body of the table. They are used to mention the source of data especially in case of secondary data. kK. There should be units of measurement. BUSINESS DATA ANALYSIS II] SEMESTER B.COM |31General form of a Statistical Table Title: Tahle No: Head note: Stub heading Column captions Total Column heading Stub entries Body of the table Total Footnote: Source: Types of tabulation Statistical tables can be classified as follows: 1. On the basis of Coverage: a. Simple: In a simple table the data are classified according to only one characteristic. Itis'termed as One way or Single way table. b, Complex: In a complex table two or more characteristics are shown. It can be Two-way table, Three-way table or Manifold table. 2. On the basis of Objective (Purpose): a. General Purpose table: It provides information for general use and usually in chronological order. b. Special Purpose table: It presents thedata relating to a particular or a special purpose. Ratios, percentages ete., are uscd to facilitate comparison. 32 | BUSINESS DATA ANALYSIS 7 SPunsTER B.COM3. On the basis of Originality. a. Primary table: In primary table the statistical forms are expressed in original terms. It contains actual and absolute data. b. Derived table: In a derived table, the data and results are derived from the primary table. It presents totals, percentages, ratios, averages, dispersion, coefficient of correlation etc Problems 1. Draw a neat blank table to present data relating to the college students according to faculty (Arts, Commerce and Science), Class (P.U.C. & Degree), Sex (Male, Female) and Years (2014, 2015), Solution: Table showing data relating to students during the year 2014 and 2015 ‘Year 2014 2015 Grand Faculty Male] Female] Total] Male] Female] Total] Total PUC a Degree Puc Commeree| Degree science | PUG Degree Total 2. Dial a blank table to show the distribution of personnel in a manufacturing concern according to:- a) Sex : Male and Female b) Three grades of Salary : below * 10,000, > 10,000, > 20,000, ~ 20,000 and above, ©) Two periods: 2015 and 2017 d) Three age groups : below 25, 25 and under 40, 40 and over os HUSINUSS LALA ANALYSIS JU SAAIBSIBN B.CUAE | 55Solution: Table showing distribution of personnel according to salary, age groups and sex for two years Below | = % 10,000 ona z 10,000- & Grand y 10,000) 39,000 | above _| Total = M|F/T|M|F[T|M|F/T|M[F[T Below 25 25 & Under 40) 201 | 40 and 5 _| above Total Below 25 25 & Under 4 201 | 40 and 7 | above Total 3. In a sample study about, reading newspaper of people of a city, the following information was received. Present the data in a tabular form Males: 65% Females: 35% Females not reading newspaper; 25% People reading newspaper : 70% (May 2015) Solution : Table showing Newspaper reading habit of people of a city in percentage Gender Habit Males | Females | Total Reading Newspaper 60 10 70" Not Reading Newspaper 5 25" 30 Total 65 35° 100 34 | BUSINESS DATA ANALYSIS IIT SEMESTER B.COM(*) figures are given in problem. Others are arrived by minor calculation of additions and subtractions. Example 4: In a sample study about coffee habit in two towns, the following information was received: Town A: | Females were 40%, Total Coffee drinkers were 45% and Male non-coffte drinkers were 20% Town B: | Male were 55%, Males non-coffee drinkers were 30% and female coffee drinkers were 15% Represent the data in a tabular form. Solution: Table showing the coffee drinking habit of towns A and B (in percentage) Tease “Town Town = A r= B Habit Male | Female Total | Male | Female | Total Coffee Drinkers 40 |S 45° | 25 1s” 40 Non-Coffee Drinkers) 20° 35 55 | 30° 30 60 Total 60 40" 100 | 55° 45 100 Example 5: Present the following information in a suitable tabular form. In 2011, out of 2,000 workers‘in a factory, 1550 were members of a trade union. The number of women workers employed were 250, out of which 200 did not belong to any trade union. In 2012, the numbers of union workers were 1725, of which 1,600 were men. The numbers of non-union workers were 380, among whom 155 were women. BUSINESS DATA ANALYSIS JI SEMESTER B.COM |35Solution: Table showing membership of Trade Union in factory in 2011 and 2012. Year 2011 2012 Trade Union | Male | Females | Total | Male | Females | Total | Members 1500 50 1550° | 1600" | 125 1725" Non-members 250 | 200° | 450 | 225 155° | 380° Total 1750 | 250° | 2000" | 1825 | 280 | 2105 | 1. Diagrams: Diagrams are visual aids or drawifigs presenting the classified data attractively and impressively in the form of pictures, figures and curves. Types of Diagrams: a. One-dimensional Diagrams (Bar diagrams) iti. Line Diagrams: Line diagrams ate used in case where there are many items to be shown and there is hot much difference in their values. They are in the form of vertical lines (thin bars). The sequential lines drawn on the X-axis. Simple Bar Diagrams: Simple bar diagrams can be drawn either in horizontal or vertical base. But vertical bars(thick lines) are more common with equal width but variable length. The magnitude of a quantity is represented by the height or length of the bars. Simple bar diagrams are“used to present individual observations, time series and spatial series. Colours can be used to make bars attractive. Sub-divided Bar Diagrams: In this diagram the bar is sub-divided into various parts in proportion to the values given in the data and the whole bar represents the total. The parts are in the ratio of various components and arranged or placed or staked one on top of another. Such diagrams are also called as Component Bardiagrams. Sub-Divided Percentage Diagrams: They are drawn on percentage basis. Each component is expressed us the percentage of its tespective total. The length of all the bars are ken equal 100 aud each bat is sub-divided in the proportion of the percentage of their components. 36 | BUSINESS DATA ANALYSIS JI’ SEMESTER B.COMThis diagram is used for comparison purpose where relative changes can be studied. Different components of a bar are distinguished either by different colours or shadings. v. Multiple Bar Diagrams: These are used when comparison is to be made between two or more phenomena over a period of time. They are also called as Compound Bar Diagrams. In this diagram, separate bars are drawn for each phenomenon and placed next to each other at equal distance. In order to distinguish between different bars, different colours, shades or dots can be used. d. Two-dimensional Diagrams (Area Diagrams): In one dimensional diagram, only length is taken’ into account. But in two dimensional diagrams, the area represents the data and’hence both length and breadth have to be taken into account. Two dimensional. diagrams are also called as Area diagrams or Surface Diagrams. The most common forms of Area diagrams are: 1. Rectangles: Rectangles ate used to represent relative magnitudes of two or more values. The area of the rectangle are kept in proportion to the values. The ared equals width multiplied by the length of rectangle. Rectangles are placed side by side for comparison. 2. Squares: When the range of valties is wide it is difficult to diagrammatically represent them in form of rectangles. To overcome this difficulty Squares are drawn. To draw squares, square root is taken of the values Of the various items to be shown in diagram. Then with a convenient scale, squares are drawn. 3. Clreular Diagrams.or Pie-Chart: These diagrams are comparatively easy to draw. With the use of circles and sectors, total as well as component parts can be shown. Circles are drawn by making their areas proportionate to the magnitude of the data. The only limitation of this type of diagram is it is difficult to judge with accuracy the relative areas of the circle. Selection of a Suit ble diagram There are several methods available ‘for diagrammatic representation of statistical data. Selectivu of suilable method however is not easy and a practical problem. Selection of appropriate method depends on two considerations: BUSINESS DATA ANALYSIS II SEMESTER B.COM |371. Nature of data to be represented: This helps in determining whether diagram should be one-dimensional or two-dimensional or three dimensional 2. The kind of people to whom the information is to be communicated; The cducational level of people to wham the statistical information is to be communicated is also to be considered. For common people with little statistical knowledge, simple pictorial or cartograms may be used for easy understanding. To show area, squares or circles are more appropriate In practice, statistical data are presented diagrammatically through a number of figures such as Bars, Rectangles, Squares, Cube, Circles etc, But bar-diagrams are the most popular ones. But if in the given data, there are three or more components then bar diagfam becomes complicated. In such cases, circular diagrams are suitable. But circular diagrams cannot be used in case of series of data as relative comparison is difficult. If there is a gap between the highest and lowest value in a set of data, then three- dimensional diagram may be used, Pictograms are uséd for advertising or publicity purpose. 38 | BUSINESS DATA ANALYSIS 17 SEMESTER B.COMReview Questions Section A 2 Marks SAIN AK AWD 9. 10. 11. 12. 13. Section B PAYNAWABNE 9. Define Statistics. State any four limitation of Statistics. Mention functions of Statistics. State any four objectives of statistics. Explain the reason for distrust of statistics. ‘What is the scope of Statistics? What do you mean by Distrust of Statistics? ‘What do you mean by Primary data? ‘What are the two sources of data? Give the meaning of Questionnaire. What is a Statistical table? Give the meaning of Frequency. What is meant by Census survey? 6 & 14 Marks State the importance of Statistics. Briefly explain the objectives and functions of Statistics. Statistics is a Science or arts — Comment. Write a note on Distrust of statistics. . Explain the role of Statistics in business and management. . Explain the scope of Statistics. . What is a Statistical table? What are its elements (parts)? . Prepare a frequeney distribution with exclusive class intervals (0-10, 10- 20 and so on) with tally bars from the following values of variables 76, 16, 24, 35, 86, 62, 80, 57, 29, 06, 87, 92, 44, 36, 67, 37, 14, 56, 29, 73, 20, 89, 96, 49, 34, 58, 23, 60, 49, 55 Prepare a frequency distribution from the following data taking a class interval of 5 magnitudes by inclusive method. 14, 26, 32, 09, 15, 34, 40, 28, 12, 03, 11, 05, 16, 24, 37, 53, 23, 50, 41, 17, 6, 20, 29, 18, 43, 26, 02, 10, 32, 16, 08, 07, 24, 41, 35, 20, 29, 13, 15, 26 BUSINESS DATA ANALYSIS JI SEMESTER 8 COM \3910. Form a frequency distribution on from the following data by exclusive method taking four as the width of the class: 17. 15, 22, 11, 16, 19, 24, 29, 18 25, 26, 32, 14, 17, 20, 23, 27, 30, 12 15, 18, 24, 36, 18. 15, 21, 28, 33, 38 34, 13, 10, 16, 20, 22, 29, 19, 23, 31 (May 2015) . Draw a blank table to show the candidates gender wise appearing degree first year, second year and third year examination of a university in the faculties of Arts, Science and Commerce in/a certain year 12. Present in tabular form with suitable captions the information contained in the following: In 2010, out of 1750 workers of a factory, 1200 workers were members of a trade union. the number of women employed was.200 of which 175 did not belong to a trade union: Tn 2011, the numberof union workers increased to 1510 of which 1290 were men. On the other hand, the number of non-union workers fell down to 208, of which 180 were men. In 2012, there were on the pay tolls‘0f factory 1,800 employees who belonged to a trade union and 50 who did not. Of all the employees in 2012, 300 were women of whom only 8 did not belong to a trade union. 40 | BUSINRSS DATA ANALYSIS 17 SEMESTER B.COMUNIT - 2 MEASURES OF CENTRAL TENDENCY AND DISPERSION Meaning — Calculation of Standard Deviation and Co-efficient of Variation in Individual, Discrete and Continuous Series — Problems using Direct Method only. Measures of Skewness — Calculation of Karl PearSon’s method of skewness (Uni-modal only) Introduction One of the important objectives of statistics is to find out.various numerical values which explains the inhererit Characteristics of a frequency distribution. The first of such measures is Averages, The averages are the measures which condense a huge unwieldy’set of numerical data into single numerical values which represent the entire distribution. The inherent inability of the human mind to remember a large body of numerical data compels us to few constants that will describe the, data. Averages proyide us the gist and give a bird’s eye view of the huge mass of unwieldy numerical data. Averages are the typical values around which other items of the distribution congregate. This value lies between the two extreme observations of the distribution and give us an idea about the concentration of the values in the central part of the distribution. They are called the measures of central tendency. Averages are also called Measures of Location since they enable us to locate the position or place of the distribution. in question. Averages are statistical constants which enables us to comprehend in a single value the significance of the whole group. According to Croxton and Cowden, an average value is a single value within the range of the data that is used to represent all the values in that series. Since an average is somewhere within the range of data, it is sometimes called a Measure of Central Value. An average is the most typical representative item of the group to which it belongs, and which is capable of revealing all important characteristics of that group or distribution, BUSINESS DATA ANALYSIS Ji SEMESTER B.COM |41Meaning: A Measure of Central Tendency is a statistical measure that locates the middle of the entire data. In other words, a Measure of Central ‘endency is a single central value around which data assemble. Thus, a Measure of Central Tendency describes the entire data, which is closer to the central value. It is an average value that makes the mass data easy, useful and meaningful to understand for further study. Definition: According to Murry R Spiegel, “Average is a value which is typical or representative of a set of data”. According to Clark and Sekkade, “Average is‘an attempt to find one single figure to describe whole of figures”. According to Bowley, “An average is only a short)way of expressing an arithmetical result”. According to Wallis and Roberts,An average is a single number describing some features of a set of data”. It is clear from the above definitions that average is called a ‘type’ as it is a typical value of the entire data and is ‘measure of central tendency. Objectives and Functions of Averages: 1. Representative of the group: An average represents all the features of a group; hence the results about the whole group can be deduced from it. p . Brief description: An average gives us simple and brief description of the main features of the whole data. 3. Helpful in comparison: The measures of central tendency or averages reduce the data to a single value which ie highly useful for making comparative studies. For example, comparing the per capita income of two countries, we can conclude that which country is richer. 4, Helpful in formulation of policies: Averages help to develop a business in case of a firm or help the economy of a country to develop. 5. Base of other statistical Analysis: Other statistical devices such as Mean Deviation, Co-efficient of Variation, Correlation analysis, Time Series and Index Numbers are also based on Averages. 42 | BUSINESS DATA ANALYSIS JIT SEMESTER B.COM6. Help in decision making: In the process of experimentation and research, averages are valuable in setting standards, estimation and other managerial decisions. 7. To facilitate quick understanding of complex data: Averages reduce a complex mass of data into a single typical figure. That ic, an average condenses the mass of data into a single value. For example, it is impossible to remember the marks scored by 60 students of B. Com class, but it is easy to remember the average marks —a single figure. 8. To know about the universe from a sample: Average helps to obtain the picture of a complete universe by means of sample data. The average of samples gives a better idea about the average of the population 9. To establish mathematical relationship: An average becomes essential when it is described to trace the ‘mathematical relationship between different groups. For example, simply saying that expected life of an average English man is more:than that of an Indian, iS:something vague. But definiteness or clear idea’.can be arrived if, expected lives are expressed in averages i.¢., in numbers. Essential of a Good Average, An average represents the statistical data-and it is used for purposes of comparison, itmust possess the following properties. 1, It must be rigidly defined and.ot left to the mere estimation of the observer. If the definition is rigid, the computed value of the average obtained by different persons shall be similar. 2. The average must be based upon all values given in the distribution. If the item is not based on all value it might not be representative of the entire group of data. 3. It should be easily understood. 'The average should possess simple and obvious properties. It should be too abstract for the common people. 4. It should be capable of being calculated with reasonable care and rapidity. 5. It should be stable and unaffected by sampling fluctuations, 6. It should be capable of further algebraic manipulation. BUSINESS DATA ANALYSIS II SEMESTER B,COM |43,Characteristics of a Typical Average: According to Yule and Kendall, an average must possess the following characteristics: 1s aoe wn x It should be rigidly defined so that there is no confusion with regard to its meaning and connotation. . It should be easily understood. . It should be simple to compute. . Its definition should be in the form of a mathematical formula. . It should be based on all items of the data. . It should not be unduly influenced by any Single item or a group of items. . It should be capable of further algebraic treatment. 8. It should be capable of being used in further statistical computation. 9. It should have sampling stability. Types of Averages The following are the important types of averages: 1. Arithmetic Mean a) Simpleand —_b) Weighted Median Mode . Geometric Mean . Harmonic Mean yay 44 [BUSINESS DATA ANALYSIS II SEMESTER B.COMArithmetic Mean: It is a value obtained by adding together all the items and by dividing the total by the number of items. It is also called Average. It is the most popular and widely used measure for representing the entire data by one value. It is denoted by the symbol X Arithmetic mean may be either: 1. Simple Arithmetic Mean, or 2. Weighted Arithmetic Mean. Properties of Arithmetic Mean: 1. The sum of deviations of the items from the arithmetic mean is always zero ie. E(x—) 2. The Sum of the squared deviations of the items from A.M. is minimum, which is less than the sum of the squared deviations of the items from any other values. 3. If each item in the series is replaced by the mean, then the sum of these substitutions will be equal tothe sum of the individual items. ; Direct |. Shortcut aa Average | Series.“ ygetnoa’| > Method sai Individual | 7 _ 2K |X 4477 I Observation ny n if Simple |Diserete [7 _ 2k |X = a+ TO es Ae sce Arithmeti | Series N N N Mean | Continuous | 22x [X= 4, UE | — tfdé Series N N |X=Aty x csi T Weighted ona Arithmeti Mean |" Only X = Arithnetic Mean ‘A= Assumed Mean X= Weighted Arithmetic Mean d= Deviation (x-A) ¥=Sigma/summation C/i= Common factor/step deviation X= Value of Variable fad = Product of P & Frequency of X” ‘Efd= Sum total of fa? Product JX = Product of ‘X° & PF W = Weights assigned to X YX = Sum total of ‘X’ values WX = Product of *X” & W* BUSINESS DATA ANALYSIS M1 SEMESTER B.COM| 45Yfke = sum total of the fe" Product _| YW = Sum of weights n/N=No. of items / values Ywx=Sum of the ‘wx’ Product 1 Problems on Simple Arithmetic Mean A. Individual Observation: 1) Calculate mean from the following data: Marks: 35 45 50 73 53 55 68 30 38 43 Solution: Steps: 1) Add up all the values of the X variables and find out 2X. 2) Divide YX by their number of observations (N) =~: a Pay =x = The Sum of Variables N= Number of Observations SLNo. | Marks (X) 1 35 2 45 3 30, 4 B 5 33 6 55 7 68 | 30 9 38 10 B N=10 | 2X = 490 ye “Wl za 10 ~ To ¥ = 49 Marks 46 | BUSINFSS DATA ANALYSIS Il SEMESTER B.COM2) Find out the Mean wages from the following Wages: 65 80 85 100 120 130 135 155 Solution: SINo. | Wages (X) I 65 |. 2 80 3 35 [4 100 3 120 6 BO 7 135 8 155 18 ¥x = 870 ree » ~N yu 870 20 X = 108.75 3) From the following data calculate Arithmetic Mean Marks: 40 37 13 62 60 33 41 Solution: SL. Marks n=7_ | x=286 RIISINFSS DATA ANAT YSIS Ii SEMESTER B.COM|474) Calculate Mean from the following data: Values: 20 31 27 39 2733 23 Solution: Sl.No. | Values (X) I 20 31 3 27 4 39 3 27 6 7 33 23. 1-7 Dx = 200 5) The intelligence quotients of 10 boys in a class are given below. Calculate mean intelligence quotient for the data given. IQ: 70, 120, 110, 101, 88, 83, 95, 98, 107, 100 Solution: Sl. IQ) No, 70 120 110 101 gi 83 95 98 107, 100 nm=10 | Sx =972 | x0] 29] Efx 3) Divide Zfx by the total of frequency (N) The formula ¥ = = X = Arithmatic Mean, 3fX = Total of Product fx N = Total of frequenéy Problems: 4 1) From the following data calculate‘arithtnetic mean: xX/| 0 1 2 3 A 5 f |'46 | 76§e38.) 75 | 40 | 25 Solution: xe XK 0 | 46 0 1 | 76 76 2 [38 76 3 [3 225 4| 40 160 3 | 25 125 N=300| 2 fX = 662 2 x = 662 r 300 ¥=221 BUSINESS DATA ANALYSIS Ji SEMESTER B.COM | 492) Find the Mean from the following: Marks 15 | 25 | 35 | 45 | 55 | 65 | 75 | 85 No of students | 10 | 15 | 30 | 55 | 85 | 60 | 45 | 25 Solution: Marks = X, No. of students =f Marks (X) | No of students (f) 1X 15 10 150 25 15 375 35 30 1050 45 55 2475 Ss BS Ab/> 65 60 3900 75 45 3375 85 25 2125 N=325 Zfx = 18125 18125 i = = 55.77 marks 3) From the following mark$'secufed by 40 students, find the Average marks Marks 40 | 50) 60.) 70 | 80 | 90 No of students | 7 ll | 8 7 3 4 Solution: Marks = X, No. of students Marks(X) |No of students (f) 1X 40 7 280 50 iL 550 60 8 480 70 7 490 80 3 240 90 4 360 N=40 dfx = 2400 X = 60 marks 50 | BUSINESS DATA ANALYSIS IIT SEMESTER B.COM4) Calculate the Average Wages from the following: Weekly Wages | 15] 20] 25 | 30 | 35] 40 | 45 No. of Workers | 3 [25/19] 16]; 4] 5 | 6 Solution: Weekly Wages=X No. of workers =f Weekly Wages|No. of Workers £X & (f) 15 3 45 20 25 500 25 19 475 30 16 480 35 4 140 40 5 200 AS 6 270 aN=78 Sfx = 2110 Lik 7 Mal = x2 Rs.27.05 5) From the following data, calculate the Arithmetic Mean xX | 10.) 15 | .20°)°24- 7°30 f 4 5, 4 4 3 Solution: x f X 10 4 40 15 5 ‘73; 20 4 80 25 4 100 30 a 90 N=20. ZfX = 385 x faa 388 Rs.19.25 BUSINESS DATA ANALYSIS IIT SEMFSTER B.COM | 51C. Continuous Series Direct Method Steps: 1) Find out the mid value of each group/class. The mid value is obtained by adding the lower limit and upper limit of the class and dividing the total by 2(two). Mid value is represented by small ‘x’ Ex: In a class interval say 10-20, the mid value ise =15 (10 —> lower limit and 20 upper limit) 2 Multiply the mid value of each class by the frequency of that respective class. i.c., fm=fm 3) Add up all the products of fm=> fm 4) fim is divided by N by applying formula =fm x cet Marks > C.I. No.Students > f 1) From the following find out the mean marks Marks 0-10] 10-20 }, 20-30 | 30-40 | 40-50 | 50-60 No. of Students 12 18 27 20 17 6 Solution : Marks | No of Students | m fm ) 0-10 12 3 60 10-20 18 15 270 20-30 27 25 675 30-40 20 35 700 40-50 17 45 765 50-60 6 55 330 N= 100 Lim = 2800 2800 =fm a = X = 28 marks 100 52 | BUSINESS DATA ANALYSIS IIT SEMESTER B.COM = — —2) From the following data find out the mean wages. { Wages 10-20 | 20-30 | 30-40 | 40-50 | 50-60 | [ No. of Workers | 10 20 24 26 30 | Solution; No of Wages | Workers m fm 0) 10-20 10 15 150 20-30 20 25 500 30-40 24 35 840 40-50 26 45 1170 50-60 30 35 1650 N=110 Dfm = 4310 > _ ifm gz __ 4310 x= ONG Fo Rs.39.18 3) Calculate mean from the following data CA [10-25-] 25-40 | 40-45-] 55-70 | 70-85 | 85-100 [= 10 |= 20. 40" | 25 3 2 ex yr my fn 10-25 10 175 175 25-40 20 32.5 650 40-55 40 47.5} 1900 55-70 25 62.5 | 1562.5 70-85 3 715 | 232.5 85-100 2 92.5 185 | N= 100 “iin = 4705 | = Xfm oh A708. Fe r= = R=47, ty = 5 47.05 BUISTNFSS DATA ANALYSIS /T SEMESTER B.COM | 534) Compute the Arithmetic Mean of the following series Marks (C.1) 0-10 | 10-20 | 20-30 | 30-40 | 40-50 No of students |_5 7 15 | 25 8 No of students | m fm Marks ) 0-10 5 3 25 10-20 7 15 105 20-30 15 25 375 30-40 25 35 875 40-50 8 45 360 N=60 Sof = 1740 10 60 men ma 5) Calculate the mean of the following frequency distribution relating to the marks secured by students in Statistics. Marks (X) 0-20 |.-20-40 |, 40-60 | 60-80 | 80-100 No of students(f) | 22 48 64 16 10 Marks — Class Interval No. of Students 3 Solution: Marks (X) No of students(f) m fm 0-20 22 10 220 20-40 48 30 1440 40-60 64 50 3200 60-80 16 70 1120 80-100 10 90 900. N= 160 Lfm = 6880 fm 6880 a y x Te X = 43 marks 54 | BUSINESS DATA ANALYSIS JI SEMESTER B.COM6) The following are the monthly salaries in rupees of 20 employees of the firm: 131, 63, 146, 118, 124, 75, 150, 142, 111, 99, 66, 116, 99, 102, 70, 85, 81, 123, 133, 95 The firm gives bonus of 10, 15, 20, 25 and 30 for individuals in the respective salary groups, exceeding 60 but not exceeding 80, exceeding 80 but not exceeding 100 and so on up to 140 but not exceeding 160. Find the Average bonus paid per employee. Solution: Note: We have to convert the data into grouped frequency distribution with the help of tally-sheet to decide the amount of bonus. Calculation of Frequency using Tally Bars Salary (X) | Tally Bars | f 60-80 ti 4 80-100 A 5 100-120 UM 4 120-140 AL ‘4 140-160. Ml #3 N=20 x f X 10 4 40 15 5 wb 20 4 80 25 4 100 30 3 90 Zfx=385 yok = 385 y= 1925 N ae BUSINESS DATA ANALYSIS JI SEMESTER B.COM| 55Open End Classes: In certain cases, the lower limit of the first-class interval and upper limit of the last class interval are not known, and such intervals are termed as Open-End Classes. In such circumstances mean cannot be calculated. If you want to calculate mean put some figures there. If class intervals are of equal magnitude, then this class should be made accordingly. Ex:- Below 10 = This canbe made 0-10 10-20 20-30 30-40 40 50 Above 50 & This can be made 50 — 60 7) Calculate the arithmetic mean from the following data: C.I | Below 65 | 65-70 |. 70-75 | 75-80 | Above 80 F 7 5 6 4 3 ci | f m fm 60-65 |S 7 62.5 B15 65-70 | _5 675 337.5 70.75 | 6 72.5 435 75.80 | 4 715 310 30-85 | 3 82.5 2475 N=25 Dim = 17675 Df yu 1975 g_agy N 25 ee Cumulative Series: Cumulative Series can be of either “more than” type (or) “less than type. In the “more than” type the frequencies are cumulated upwards so that the first-class interval has the highest cumulative frequency, and it goes on declining in subsequent classes. In case of “less than” type the frequencies are cumulated down words so that the first class has the lowest frequency, and the subsequent 5G | BUSINESS DATA ANALYSIS JIT SEMESTER B.COMclasses have higher cumulative frequencies. In both types of cumulative series, the data are first converted into a simple series, either exclusive (or) inclusive (Preferably Exclusive). After it the calculation of mean is done in the manner we usc to do earlier. 8) Calculate the average marks of the students from the following data Marks | Below | Below] Below | Below ] Below] Below | Below ] Below ar 10 20 | 30 40 50 60 70 80 No of : sterens | 15 | 35 | 60 | 84 | 96 | 127 | 198 | 250 Solution: In this problem cumulative classes and frequenties are given. We will first convert the data into simple series from the given Jess than cumulative classes and frequencies. After this, the calculation of mean i§ done. Conversion of cumulative into Normal Series Less Than C.1| Normal €.1. | Less Than Cf Below 10 0.10 15 Below 20 10-20, 35 Below 30 20-30 60 Below 40 30-40 84 Below 50 40-50 96 Below 60 50-60 127 [127-9631 Below 70 00-70 18198-12771 Below 80 70-80 250 250 19852 Normal CX] 0-10 [10-20] 20-30 [30-40 | 40-50 [50-60] 60-70 | 70-80 Normal 1s |-20 f2aszs oe | iw [om | on | sa frequency Ci f x fx 0-10 15 3 75 10-20 | 20 15 300 20-30 | __25 25 625 30-40 | 2435 840 40-50 2 45 540 50-60 | 31 35 1705 60-70 | 71 65 4615 THISINTAS DATA ANALYSIS ITT SRMESTTR NCO | 5770-80 52 75, N=250 126000 250 9) Find arithmetic mean from the following ‘More than | More than | More than | More than | More than | More than ‘Wages 20 30 40 50 60 70 No of Workers| 63 50 40 18 L Solution: In this problem more than cumulative classes and frequencies are given. We should first convert the data into simple series before calculating mean. 58 | BUSINESS DATA ANALYSIS // SEMESTER B.COM » Normal More than CI] Normal C'|.More than Cf | frequency oo. More than 20 20°30 65 65—63 02 More than 30 30-40 8 63-50 13 More than 40 40-50 50 50—40 > 10 More than 50 30-60 40 40-18 22 More thani60 60-70 18 18-711 More than 70 70-80 7 7 Wages | Noof | m fm (Rs) “| Workers @ 20-30 2 25 50 30-40 B 35 455 40-50 10 45 450 50-60 22 35 1210 60-70 il 65 715 70-80 7 75 525 Lfm = 3405 3405 ==3 X = Rs.52.38Inclusive Class Intervals: While calculating mean in a continuous series with inclusive class intervals, it is not necessary to convert the series into an exclusive class intervals series by adjusting class limits. It is also not necessary to re-arrange the series in an ascending (or) a descending order as is done in case of median. 10) Calculate Arithmetic mean from the following data C1 | 0-4 | 5-9 | 10-19 | 20-29 | 30-39 | 40-49 | 50-59 | 60-69 f | 328 | 350 | 720 664 598 524 378 244 Note: Add first two CI and frequencies to make Equal width between all CT's and do the solution. C1] 0-9 | 10-19 | 20-29 | 30-397] 40-49 | 50-59 | 60-69 f | 678 720 664 598 524 378 244 The data given is in inclusive series and is to be converted into exclusive series. For conversion to exclusiveyseries the following formula is to be used Lower.limit of any class ~ upper limit of previous class Correction factor = 2 10-8 1 =>=05 2 2 After obtaining the correction factor, it has to be deducted from lower limit and added to upper limit to convert data inclusive class interval to exclusive class interval Correction factor = C1 f m fm ~0.5-9.5, 678 4.5 3051 95-195 720 145 10,440 195-295 664 24.5 16,268 29.5395 598 [34.5 20,631 39.5-49.5 524 44.5 23,318 49.5-59.5 378 54.5 20,601 59.5-69.5 244, 64.5 15,738 N=3806 Yix=110047 110,047 3806 X=28.91 BUSINESS DATA ANALYSIS IIT SEMESTER R COM |59Merits of Arithmetic Mean: 1. It is simple to understand and casy to calculate. It is affected by the value of every item in the series. . Itis rigidly defined. . Itis capable of further algebraic treatment. It is calculated value and not based on the position in the series. . The mean is a more stable measure of central tendency (Ideal average). . Itprovides a good basis for comparison. . It is based on the value of every item in the series. PADARYWN Demerits of Arithmetic Mean: 1. It is affected by extreme items i.e., very small and very large items. 2. Itcan hardly be located by inspection. 3. Insome cases A.M. does not represent the actual item)For example, average patients admitted in a hospital is 10.7 per day. Arithmetic Mean is not suitable in extremely asymmetrical distributions. 5. It may lead to false conclusion. 6. It is not useful for the study of qualities like intelligence, honesty and character. 7. It cannot be accurately determined even if one of the values is not known. Median Median is that value of the variable which divides (he dala in two equal parts. One half’ comprising values givater than and the other half’ values less than median. It splits the obséVation into two halves. Median refers to the middle value in a distribution. It is denoted by the symbol ‘M’ or Me Median is a Positional Average unlike Arithmetic mean which is a pure average. That is Median is not based on mathematical formula but is a place value in an arranged series. Definition: According to Croxton and Cowden, “The median is that value which divides that one half or more of the items are cqual to or less than it and one. half or more of (hie ites are equal to or greater than it”, 60 | BUSINESS DATA ANALYSIS Ii SEMESTER B.COMIn the words of L.R.Connor, “ The median is that value of the variable which divides the group into two equal parts, one part comprising all the values greater and the other, all the values less than median.” Formula Individual Discrete Series Continuous Series Observation m +1) +1) Median Glass m= ()" tem| m= C2)" tem] BORIS n/2 Ma L+ meat xife M —> Median n—> No. of observation /Items N —> Frequency Total L — Lower limit of ttle median class (Middle Class) Cf — Cumulative frequenéy of te class preceding Median class i/e ife — Class interval of Median Class £+Frequency of Median Class Note: Before applying formula, the data given should be arranged in ascending (or) descending arden == A) Individual Observation: Median refers to the middle value in a distribution. In a series of individual observations, if the total number of items is an odd figure, the value of the middle item is the wedian value. If the nuiuber of items is even the median value is the average of the two items in the centre of the distribution. — BUSINESS DATA ANALYSIS Ji SEMESTER B.COM|61