Syllabus of Business Statistics

 Unit 1

Data Representation, Central Tendency, Dispersion, Kurtosis, Skewness

 Unit 2

Types of Probability – Independence, Dependence Events, Bayes’ Theorem

 Unit 3

Concept of Random Variable, Probability Distribution, Expected value and

Variance, Decision Theory, Decision Tree

 Unit 4

Types of Probability Distribution – Binomial, Poisson, Normal

 Unit 5

Sampling Distribution with Central Limit Theorem

 Unit 6

Estimation – Point & Interval

 Unit 7

Hypothesis Testing – students t, Chi Square, z test

 Unit 8

Analysis of Variance – one way, two way

 Unit 9

Correlation & Regression Analysis

Prepared by Dr M. Gowri Shankar

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 Business Statistics
Definition of Statistics

The word statistics has been derived from the Latin word ‘status’. In the plural sense it means a
set of numerical figures called ‘data’ obtained by counting or measurement. In the singular sense
it means collection, classification, presentation, analysis, comparison and meaningful
interpretation of raw data

It is defined as the science which deals with the collection, analysis and interpretation of
numerical data

Nature of the statistical study

Formulation of the study

Objectives of the study

Designing data collection

Conducting the field survey

Organizing the data

Analyzing the data

Reaching statistical findings

Presentation of findings

Applications of Business Statistics

The planning of operations – relating to the special projects for the firm

Setting up of standards – size of employment, volume of sales, fixation of quality norms for the
manufactured product, norms for the daily output

In statistical quality control methods – statistics can be useful in various ways to ensure of
production of quality goods. This is achieved by identifying and rejecting defective or
substandard goods. The sales targets can be fixed on the basis of sale forecasts, which are done
by using varying methods of forecasting, analysis of sales etc

Personnel management – measurement of productivity, comparison of wages and productivity is

undertaken in order to ensure increase in industrial productivity, concerned with fixation of
wages, incentive norms and performance of appraisal of employees

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Seasonal behavior – construct a seasonal index for the consumption of products

Export marketing – analyzing the quality of the products, to select the right products which has
demand in the overseas markets, analyzing the statistics of imports and exports

Maintenance of cost records – ensure cost of production includes cost of raw materials and
wages

Management of inventory – determine a magnitude of inventory that is neither excessive nor

inadequate

Expenditure on advertising and sales – to find association between two or more variables such as
advertising expenditure and sales

e.g Regression, Correlation

Mutual funds, banking and financial institutions – statistics provide certain tools or techniques to
a consultant or financial adviser, provide an avenue to a person to invest his savings for
reasonable returns.

Concepts of Business Statistics

Population(N)

It is a collection of people, items or events about which you want to make inferences

Population is defined as the potential set of respondents in a geographical area. It is any large
collection of objects or individuals, such as Indian housewives, consumers etc about which the
information is desired.

The numerical value that characterizes the aspect of population

Parameter

Parameter is a characteristic of population

It is used to describe the certain characteristics of population

It is any summary number, like an average or percentage, that describes the entire population

Ex: to determine the average annual expenditure on clothing in a city, proportion of employees
working overtime in a factory

Ex: the mean income of the Indian middle class, it is denoted by µ

The mean and variance for a given population are known as population parameters.

Sample (n)
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It is a subgroup of population

Statistics

Sample characteristics are called statistics

Data : It is a collection of raw facts

Classification of data : it is classified into Qualitative and Quantitative

Qualitative data : it is less statistical. It is highly unstructured

Ex: satisfaction level of workers, investors, customers etc

Quantitative data : It is highly statistical and highly structured. The data which is easily
measurable and tabulated

Ex: income, expenditure , price of a commodity etc

Variable

It is a symbol or characteristic of population(N).

Variable is denoted by X

It means any measurable characteristic or quantity which can assume a range of numerical
values within certain limits, e.g., income, height, age, weight, wage, price etc.

Classification of Variables

Data Variables & Research Variables

Data Variables can be classified as either discrete or continuous

Discrete variable

A variable which can take up only exact values and not any fractional values, is called a discrete
variable. It has specific values in a given class interval.

Number of workmen in a factory, members of a family, students in a class, number of births in a

certain year, etc., are examples of discrete variable

Continuous variable

A variable which can take up any numerical value[integral/fractional of whole number] with a
certain range is called a continuous variable. Height, weight, rainfall, time, temperature, etc., are
examples of continuous variables.

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Height of students in a school is a continuous variable as it can be measured to the nearest
fraction of time, i.e., years, months, days, etc.

Temperatures recording by a meteorological bureau, water consumption in liters etc

Research variables

Independent Variable(X)

It is a variable which can be controlled by the researcher. Independent variables are also called as
Predictors or Exogenous variables.

Independent variables are used to determine the effect on dependent variables

Dependent Variable(Y)

It is a variable which can’t be controlled by the researcher. Dependent variables are also called as
Criterion or Endogenous variables.

Ex: Sales is a Dependent variable(X), Advertising is an Independent variable(X)

Ungrouped data

The data which is not arranged or tabulated without frequency

Ex: the marks of students : 40, 30, 20, etc

Discrete series : the series without class interval and having frequency. It takes specific values.
The items which can be easily counted

Ex:

Age Number of employees

(frequency)

30 10

45 30

Continuous series : the series with class interval and having frequency. It may take any value in
a given class interval. The items cannot be easily counted.

Ex:

Class interval(age) Number of employees(frequency)

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 30-40 10

40-50 30

What is lower class interval, upper class interval? Calculate midpoint, width of the class
interval

Midpoint is 35, 45. Width of the class interval is 10

If the class interval is not continuous

Ex:

Units sold Number of

salesman(frequency)

30-39 10

40-49 30

What is lower class interval, upper class interval? Calculate midpoint, width of the class
interval

Ex:

Units sold Number of

salesman(frequency)

29.5-39.5 10

39.5-49.5 30

What is lower class interval, upper class interval? Calculate midpoint, width of the class
interval

Ex:

Productivity(units) Number of Employees (frequency)

150 - 199 10

200- 249 30

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For ex: 10 – 19

It can be made continuous by reducing the lower limit of the class interval by 0.5 and increasing
the upper limit of the class interval by 0.5 then the interval will be as follows :

10 – 19 can be rewritten as 9.5 – 19.5

Frequency : number of occurrence of value

Frequency Distribution : the arrangement and display of data, where the observed value is
paired with the frequency

Class limit : they are the lowest and highest values of a class. In 30 – 50, 30 is lower limit and
50 is the higher limit

Class interval : the difference between the upper limit and the lower limit is called the class
interval. 30 is lowest and 50 is highest

Midpoint(m) : lower limit + upper limit /2

Width of a class interval(i) = highest value – lowest value/number of groupings

Measures of Central Tendency

Central Tendency describe the centre of distribution, measures of location.

Classification of Central Tendency – it is classified into computational measures and

positional measures.

Computational measures – Arithmetic Mean (A.M), Harmonic Mean (HM) & Geometric
Mean (GM)

Positional Measures – Median & Mode

Arithmetic Mean is also called as Mean or Average. A.M is useful while making comparisons
among several data sets. A.M is calculated by taking all the values in the given data set.

Calculate the mean or average for the ungrouped data

Ex: 10, 15, 30, 7, 42, 79 and 83

X_ (sample mean) = ∑ x/n = 10+15+30+7+42+79+83/7 = 38

N – number of observations

Mean for Ungrouped data

Calculate the mean for the ungrouped data

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Ex: 12, 15, 18, 21 and 25

Problem

The monthly wages of 4 workmen are Rs. 400, Rs. 440, Rs. 380 and Rs. 360. Find the A.M. of
the wages of four workmen.

Weighted Mean Average for Ungrouped data

Calculate the weighted mean

Relative weight(w) : 2 3 5

Marks(x) : 30 25 20

wx : 60 75 100

X_ = ∑wx/∑w = w 1x1 + w 2x2 + w 3x3/w1+w2+w3

= 60+75+100/2+3+5 = 23.5 marks

Calculate the weighted average mean

Years : 1 2 3 4 5

Income(’00) : 5 10 15 20 25

Arithmetic mean using Deviation method for Ungrouped data

The monthly wages of 4 workmen are Rs. 400, Rs. 440, Rs. 380 and Rs. 360. Find the A.M. of
the wages of four workmen.

Solution

Wages (Rs.) Deviation from 440

X (d = x – 440)

400 -40

440 0

380 -60

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 360 -80

  ∑d = -180

A = Assumed Mean, n = number of items, d = deviation = x - A

Here A = 440, n = 4, ∑d = -180

X = A + { ∑d / n} = 440 + { -180 /4} = Rs. 395

Calculate the mean using direct method and deviation method

Income(’00) : 15 8 12 20 14

Income(’00) Deviation from x

X (d = x – 12)

15 3
8 -4
12 = A 0
20 8
14 2
  ∑d = 9

A = Assumed Mean, n = number of items, d = deviation = x - A

Here A = 12, n = 5, ∑d = 9

X = A + { ∑d / n} = 12 + { 9 /5} = Rs. 13.8

Calculate the mean using direct method and deviation method

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 Earnings Per Share(Rs.) : 35 40 25 50 45 60 30

Calculate the mean using direct method and deviation method

Consumption (units) : 4 10 3 16 7 9 8 6

Calculating Arithmetic mean for discrete series using direct method

A market survey on demands of bread at a local bakery provided the following

distribution of daily demand:

Daily demand (loaves of bread) Frequency (No. of days)

10 30

15 25

20 40

30 20

40 35

Find the average demand of bread in numbers/day

Solution

Daily demand Frequency (No. of days) fx

( loaves of bread) f

10 30 200

15 25 375

20 40 800

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 30 20 600

40 35 1400

  N = ∑f = 150 ∑fx = 3475

X = ∑{fx} / N = {3475/ 150} = 23.17

Calculating Arithmetic mean for discrete series using direct method for the given distribution

Wages (Rs.) No. of employees

400 8

440 6

380 12

360 10

Calculating Arithmetic mean for discrete series using direct method and shortcut method or
deviation method for the given distribution

Returns(‘000’) No. of investors

92 12

125 7

180 6

80 9

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 Solution

Direct Method

A.M= X = ∑{fx}/N = {12*92+125*7+180*6+80*9}/ {12 + 7 + 6+ 9} ={3779/34} =

111.15

Short cut method or deviation method

Returns(‘000’) No. of investors Deviation from A(=125) fd

i.e. d = (x – 125)

92 12
-33 -396
A = 125 7
0 0
180 6
55 330
80 9
-45 -405
  ∑f = 34   ∑ fd = -471

Here A = 125, ∑fd = -471, N = 34

X = A + ∑ {fd} / N = 125 + {-471/34} = 111.15

Calculating Arithmetic mean for discrete series using direct method and shortcut method or deviation
method for the given distribution

Profit(Lakhs No. of
) investors

22 10

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 15 18

18 2

24 4

Calculating Arithmetic mean for discrete series using direct method and shortcut method or deviation
method for the given distribution

Units No. of
sold salesman

315 20

260 15

200 7

400 30

Arithmetic mean for Continuous Series using deviation method

Calculate A.M for the given series using deviation method:

Class Interval Frequency

10 – 20 10

20 – 30 15

30 – 40 5

40 – 50 30

50 – 60 15

60 – 70 12

70 – 80 13

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 80 – 90 10

Solution

Formula for calculating A.M( X_ )

X_ = A + ∑ fd’ * i

A – Assumed mean

f – Frequency

d’ – deviation of the mean (d’ = m – A/i)

where m – the midpoint

i – Width of the class interval corresponding to the assumed mean

N – the total frequency or ∑f

Steps in calculating A.M

 Find out the midpoint of the class interval

 Locate the assumed mean (assumed mean can be identified from the centre of the
series having the midpoints)

Calculation of Arithmetic Mean for Continuous Series

Class Interval Frequency Midpoint Deviation(d’ = m – A/i) fd’

10 – 20 10 [10 + 20/2] =15 [15 -45/10] = -3 -30

20 – 30 15 25 -2 -30

30 – 40 5 35 -1 -5

40 – 50 30 45 - Assumed Mean 0 0

50 – 60 15 55 1 15

60 – 70 12 65 2 24

70 – 80 13 75 3 39

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 80 – 90 10 85 4 40

Total N =∑f = 110 ∑ 118

X_ = A + ∑ fd’ * i

X_ = 45 + (53 / 110) * 10

X_ = 45 + [4.818]*10 = 49.818

Problem

Calculate the Arithmetic Mean for the following distribution

Class Interval Frequency

10 – 15 14

15 – 20 2

20 – 25 8 Calculation of Arithmetic Mean for

Continuous Series
25 – 30 6
Class Interval Frequency Midpoint Deviation(d’ = m – A/i) fd’
30 – 35 4
10 – 15 14 [10 + 15/2] =12.5 [12.5 -22.5/5] = -2 -28

15 – 20 2 17.5 -1 -2

20 – 25 8 22.5 = Assumed Mean 0 0

25 – 30 6 27.5 1 6

30 – 35 4 32.5 2 8

Total N =∑f = 34 ∑ -16

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 Here A = 22.5, i = width of class interval = 5, ∑fd’ = -16, N = 34

X_ = A + ∑ fd’ * i

X_ = 22.5 + (-16 / 34) * 5

X_ = 22.5 + [-0.470] * 5 = 20.15

Problem

Calculate the Arithmetic Mean for the following distribution

Salary(Rs. ‘000’) No. of Employees

10 – 20 8

20 – 30 10

30 – 40 15

40 – 50 20

50 – 60 4

60 – 70 6

70 – 80 9

Calculation of Arithmetic Mean for Continuous Series

Salary(Rs. ‘000’) No. of Midpoint Deviation(d’ = m – A/i) fd’

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 Employees

10 – 20 8 [10 + 20/2] =15 [15 - 45/10] = -3 -24

20 – 30 10 25 -2 -20

30 – 40 15 35 -1 -15

40 – 50 20 45 = Assumed Mean 0 0

50 – 60 4 55 1 4

60 – 70 6 65 2 12

70 – 80 9 75 3 27

Total N =∑f = 72 ∑ -16

Here A = 22.5, i = width of class interval = 5, ∑fd’ = -16, N = 72

X_ = A + ∑ fd’ * i

X_ = 45 + (-16 / 72 )* 10

X_ = 45 + [-0.222] * 10 = 47.22

Calculate the Arithmetic Mean for the following distribution

Productivity(units) No. of Workers

5–9 15

10 – 14 9

15 – 19 24

20 – 24 30

25 – 29 8

30 - 34 5

35 - 39 2 17 | P a g e
Calculate the Arithmetic Mean for the following distribution

Units Sold No. of Salesman

15 – 19 25

20 – 24 7

25 – 29 14

30 – 34 40

Median 35 – 39 6

It is the 40 - 44 8 positional measure which divides the entire

series into two halves. It is also called as second quartile
45 - 49 7
Calculation of median for individual observation [Odd
series]

Ex: 5, 6, 8, 10, 12

Here n = 5, which is odd

Median = value of n+1/2 th term

5+1/2 = 3rd item = 8

Calculation of median for individual observation [Even series]

If n is even

4, 5, 6, 7, 8, 9

Here n = 6

Median = A.M of n/2 and n/2 + 1 th terms

6/2 and 6/2 + 1

3rd and 4th = 6+7/2 = 6.5

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The terms are 6th and 7th term

Calculate the Median for the discrete series[odd]

Wt in Kg : 112 118 122 130 40

Frequency : 6 10 5 4 2

Median for discrete series(odd)

Wt in kg F Cumulative frequency

112 6 6

118 10 16

122 5 21

130 4 25

40 2 27

N=∑f =
27

N = 27(odd) = [(N+1)/2]= [(27+1)/2] = 14

14 lies between 6 and 16 of cumulative frequency

Value corresponding to cumulative frequency 14 is 118 kg

Calculate the Median for the discrete series[odd]

Wt in Kg : 200 250 260 270 280 300

Frequency : 10 5 8 6 7 4

Median for discrete series(even)

Wt in kg F Cumulative frequency

200 10 10

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 250 5 15

260 8 23

270 6 29

280 7 36

300 4 40

N = ∑f= 40

Median = A.M of N/2 and N/2 + 1 th terms

N = 40(even) = even N/2 = 20 term and N/2 + 1 term = 21

Median = A.M of 20th and 21th values = 260+260/2 = 260

The values corresponding to 20 and 21 are 260

Calculate Median for the given series :

Class Interval Frequency

10 – 20 10

20 – 30 15

30 – 40 5

40 – 50 30

50 – 60 15

60 – 70 12

70 – 80 13

80 – 90 10

Solution

Formula for calculating Median

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Md = l 1 + N/2 – C * i

l1 - lower class interval of the median class

f – Frequency of the median class

i – Width of the class interval corresponding to median class

N – the total frequency or ∑f

C – Cumulative Frequency of the Preceding Median Class

Steps in calculating Median

 Calculate the cumulative frequency

 Locate the median class

 Identify the preceding median class

 Locate the frequency of the median class

(the median class is N/2 = 110/2 = 55)

Calculation of Median Class

Class Interval Frequency Cumulativ

e

Frequency

10 – 20 10 15

20 – 30 15 25

30 – 40 5 30 (C)

40 – 50 30(f) 60

50 – 60 15 75

60 – 70 12 87

70 – 80 13 100

80 – 90 10 110

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 Total N =∑f = 110

Substitute the values in the formula

Md = l 1 + N/2 – C * i

Md = 40 + 55 – 30/30 * 10

Md = 40 + 8.33 = 48. 33

Problem

Calculate the Median for the following distribution

Class Interval Frequency

10 – 15 14

15 – 20 2

20 – 25 18

25 – 30 6

30 – 35 4

Calculation of Median for Continuous Series

Class Interval Frequency Cumulativ

e

Frequency

10 – 15 14 14

15 – 20 2 16 (C)

20 – 25 18 (f) 34

25 – 30 6 40

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 30 – 35 4 44

Total N =∑f = 44

Solution

 Locate the median class

(the median class is N/2 = 44/2 = 22)

 Identify the preceding median class (C) = 16

 Locate the frequency of the median class (f) = 18

Lower class interval of the median class (l1) = 20

Substitute the values in the formula

Md = l 1 + N/2 – C * i

Md = 20 + [22 – 16/18] * 5

Md = 20 + 1.66 = 21. 66

Problem

Calculate the Median for the following distribution

Salary(Rs. ‘000’) No. of Employees

10 – 20 8

20 – 30 10

30 – 40 15

40 – 50 20

50 – 60 4

60 – 70 6

70 – 80 9

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 Calculation of Median for Continuous Series

Salary(Rs. ‘000’) No. of Cumulative

Employees
Frequency

10 – 20 8 8

20 – 30 10 18

30 – 40 15 33 = C

40 – 50 20 = f 53

50 – 60 4 57

60 - 70 6 63

70 - 80 9 72

Total N =∑f = 72

Solution

 Locate the median class

(the median class is N/2 = 72/2 = 36)

 Identify the preceding median class (C) = 33

 Locate the frequency of the median class (f) = 20

Lower class interval of the median class (l1) = 40

Substitute the values in the formula

Md = l 1 + N/2 – C * i

Md = 40 + [36 – 33/20] * 10

Md = 40 + 1.5 = 41. 50

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Calculate the Median for the following distribution

Productivity(units) No. of Workers

5–9 15

10 – 14 9

15 – 19 24

20 – 24 30

25 – 29 8

Calculate 30 - 34 5 the Median for the following

distribution
35 - 39 2

Units Sold No. of Salesman

15 – 19 25

20 – 24 7

25 – 29 14

30 – 34 40

35 – 39 6

40 - 44 8

45 - 49 7

Mode

Mode is the value of the variable that occurs most frequently

For the Ungrouped Data

For the ungrouped data, mode is the value of the variable that occurs most frequently.

For the Discrete Series

The value of the individual observations or items with the highest frequency is the mode for the
discrete series.

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Continuous Series

The class interval with highest frequency is mode for the continuous series.

Ex: 8,9,11,15,16,12,15,3,7,15

In the above ex: out of 10 items the number 15 appears 3 times then 15 is called mode.

Calculate the mode for the given series :

Class Interval Frequency

10 – 20 10

20 – 30 15

30 – 40 5

40 – 50 30

50 – 60 15

60 – 70 12

70 – 80 13

80 – 90 10

Solution

Formula for calculating Mode

Mode = l1 + (f1 – f0) *i

2f1 – f0 – f2

l1 - Lower class interval of the modal class

f0 - Frequency of the preceding modal class

f1 - Frequency of the modal class

f2 - Frequency of the succeeding modal class

i - Width of the modal class

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 Determination of Mode

Class Interval Frequency

10 – 20 10

20 – 30 15

30 – 40 5(f0)

40 – 50 30(f1)

50 – 60 15(f2)

60 – 70 12

70 – 80 13

80 – 90 10

Solution

Locate the modal class

The class interval having the highest frequency is called as modal class

l1 - Lower class interval of the modal class = 40

f0 - Frequency of the preceding modal class = 5

f1 - Frequency of the modal class = 30

f2 - Frequency of the succeeding modal class = 15

i - Width of the modal class = 10

Substitute the values in the formula we get

Mode = l1 + (f1 – f0) *i

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 2f1 – f0 – f2

= 40 + (30 – 5) * 10

2*30 – 5 - 15

Mode = 40 + 6.25 = 46.25

Problem

Calculate the Mode for the following distribution

Class Interval Frequency

10 – 15 14

15 – 20 2

20 – 25 18

25 – 30 6

30 – 35 4

Calculation of Mode for Continuous Series

Class Interval Frequency

10 – 15 14

15 – 20 2(f0)

20 – 25 18(f1)

25 – 30 6(f2)

30 – 35 4

Total N =∑f = 44

Solution

Locate the modal class

The class interval having the highest frequency is called as modal class

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l1 - Lower class interval of the modal class = 20

f0 - Frequency of the preceding modal class = 2

f1 - Frequency of the modal class = 18

f2 - Frequency of the succeeding modal class = 6

i - Width of the modal class = 5

Substitute the values in the formula we get

Mode = l1 + (f1 – f0) *i

2f1 – f0 – f2

= 20 + (18 – 2) *5

2*18 – 2 - 6

Mode = 20 + 2.857 = 22.857

Problem

Calculate the Mode for the following distribution

Salary(Rs. ‘000’) No. of Employees

10 – 20 8

20 – 30 10

30 – 40 15

40 – 50 20

50 – 60 4

60 – 70 6

70 – 80 9

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 Calculation of Mode for Continuous Series

Salary(Rs. ‘000’) No. of

Employees

10 – 20 8

20 – 30 10

30 – 40 15

40 – 50 20 = f

50 – 60 4

60 - 70 6

70 - 80 9

Total N =∑f = 72

Solution

Locate the modal class

The class interval having the highest frequency is called as modal class

l1 - Lower class interval of the modal class = 40

f0 - Frequency of the preceding modal class = 5

f1 - Frequency of the modal class = 30

f2 - Frequency of the succeeding modal class = 15

i - Width of the modal class = 10

Substitute the values in the formula we get

Mode = l1 + (f1 – f0) *i

2f1 – f0 – f2

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 = 40 + (30 – 5) * 10

2*30 – 5 - 15

Mode = 40 + 6.25 = 46.25

Calculate the Mode for the following distribution

Productivity(units) No. of Workers

5–9 15

10 – 14 9

15 – 19 24

20 – 24 30

25 – 29 8

30 – 34 5

35 – 39 2

Calculate the Mode for the following distribution

Units Sold No. of Salesman

15 – 19 25

20 – 24 7

25 – 29 14

30 – 34 40

35 – 39 6

40 - 44 8

45 - 49 7

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Relationship between Arithmetic Mean, Geometric Mean and Harmonic Mean

The Harmonic Mean (HM) is defined as the reciprocal of the average of the reciprocals
of the data values. It is based on all the observations, and it is rigidly defined. Harmonic
mean gives less weightage to the large values and large weightage to the small values to
balance the values correctly. In general, the harmonic mean is used when there is a
necessity to give greater weight to the smaller items. It is applied in the case of times and
average rates.

Harmonic mean is the reciprocal of the average of reciprocals, the formula to define the
harmonic mean “HM” is given as follows:

If x1, x2, x3,…, xn are the individual items up to n terms, then,

Harmonic Mean, HM = n / [(1/x1)+(1/x2)+(1/x3)+…+(1/xn)]

The three means such as arithmetic mean, geometric mean, harmonic means are known
as Pythagorean means. The formulas for three different types of means are:

Arithmetic Mean = (a1 + a2 + a3 +…..+an ) / n

Harmonic Mean = n / [(1/a1)+(1/a2)+(1/a3)+…+(1/an)]

Geometric Mean = n√a1.a2.a3…an

If G is the geometric mean, H is the harmonic mean, and A is the arithmetic mean, then
the relationship between them is given by:

G=√A . H [ A = Arithmetic Mean H = Harmonic Mean]

Or

G2 = A.H

Example 1:

Find the harmonic mean for data 2, 5, 7, and 9.

Solution:

Given data: 2, 5, 7, 9

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Step 1: Finding the reciprocal of the values:

½ = 0.5, ⅕ = 0.2, 1/7 = 0.14,1/9 = 0.11

Step 2: Calculate the average of the reciprocal values obtained from step 1.

Here, the total number of data values is 4.

(0.5 + 0.2 + 0.143 + 0.11) = 0.953

Step 3: Finally, take the reciprocal of the average value obtained from step 2.

Harmonic Mean = 1/ Average

Harmonic Mean = 4/0.953

Harmonic Mean = 4.19

Hence, the harmonic mean for the data 2, 5, 7, 9 is 4.19.

Find the harmonic mean for data 12, 15, 18, 21 and 25.

Find the geometric mean for data 12, 15, 18, 21 and 25.

G.M=√A . H [ A = Arithmetic Mean H = Harmonic Mean]

Measures of Dispersion

Dispersion is a spread of variability in a set of data. It determines dispersal or scatter of

individual items in a given distribution from a central value. It is a measure of variation
of items. A low degree of dispersion indicates high degree of uniformity.

Measures of dispersion – mathematical or computational, Graphical, positional

Mathematical or computational – mean deviation or average deviation, standard deviation

or root mean square deviation taken from AM

Graphical – Lorenz curve

Positional measures – Range, interquartile range, Quartile deviation or semi-interquartile

range

Measures of Dispersion – Range, Quartile Deviation, Variance, Standard Deviation,

Coefficient of Variation

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 Practice Problems in Central Tendency

Calculate Arithmetic Mean, Median and mode for the following :

Productivity(Units) 10-19 20-29 30-39 40-49 50-59 60-69 70-79 80-

89

No. of Workers 2 4 9 31 12 6 4 2

Calculate Arithmetic Mean, Median and mode for the following :

Turnover(Crores) 62-63 63-64 64-65 65-66 66-67 67-68 68-69

No. of 2 6 14 16 8 3 1
companies

Calculate Arithmetic Mean, Median and mode for the following :

Units Sold 410- 420- 430- 440- 450- 460- 470-

419 429 439 449 459 469 479

No. of 14 20 42 54 45 18 7
Salesman

Calculate Arithmetic Mean, Median and mode for the following :

Revenue(Lakhs) 30-40 40-50 50-60 60-70 70-80 80-90

No. of 18 38 46 27 15 8
Companies

Calculate Arithmetic Mean, Median and mode for the following :

Net 20-30 30-40 40-50 50-60 60-70 70-80 80-90 90-

Profit(crores) 100

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No. of 5 7 19 29 16 9 8 7
companies

Calculate Arithmetic Mean, Median ,mode and Quartile Deviation for the following :

Marks 30-39 40-49 50-59 60-69 70-79 80-89 90-99

No. of 1 3 11 51 43 32 9
students

Calculate Arithmetic Mean, Median and mode for the following :

Salary 20- 30-40 40-50 50-60 60-70 70-80 80-90 90-

30(‘000’) 100

No. of 25 20 20 80 55 30 15 5
employees

Calculate Arithmetic Mean, Median and mode for the following :

Marks 20- 30- 40- 50- 60- 70- 80-

30 40 50 60 70 80 90

No. of 10 13 18 40 15 5 12
students

Calculate Arithmetic Mean, Median and mode for the following :

Sales(Units) 5-9 10-14 15-19 20-24 25-29 30-34 35-39

No. of 14 21 33 47 27 36 38
Companies

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Calculate Arithmetic Mean, Median and mode for the following :

Price of 141- 151- 161- 171- 181-

Share(Rs.) 150 160 170 180 190

No. of 5 16 56 19 4
companies

Calculate Arithmetic Mean, Median and mode for the following :

Net 11-20 21-30 31-40 41-50 51-60 61-70 71-80

Profit(crores)

No. of 42 38 120 84 48 36 31
companies

Calculate Arithmetic Mean, Median and mode for the following :

Production in 21-22 23-24 25-26 27-28 29-30

tons

No. of 7 13 22 10 8
companies

Calculate Arithmetic Mean, Median and mode for the following :

Net 0-10 10-20 20-30 30-40 40-50 50-60 60-70

Profit(crores)

No. of 4 8 11 15 12 6 5
companies

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Calculate Arithmetic Mean, Median and mode for the following :

Dividend 44- 46- 48- 50- 52-54

paid‘00’) 46 48 50 52

No. of 8 24 27 21 10
companies

Calculate Arithmetic Mean, Median and mode for the following :

Net 30- 40- 50- 60- 70-7 80-89 90-99

Profit(crores) 39 49 59 69

Frequency 2 12 22 20 14 4 1

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