Statistics:

Descriptive and Inferential

 Levels of Data Measurement

• Nominal - Lowest level of measurement

• Ordinal
• Interval
• Ratio - Highest level of measurement
Data Level, Operations, and Statistical Methods

Statistical
Data Level Meaningful Operations
Methods

Nominal Classifying and Counting Nonparametric

Ordinal All of above plus Ranking Nonparametric

Interval All of above plus Addition, Parametric

Subtraction, Multiplication, and
Division

Ratio All of the above Parametric

 Data Classifications

Data
Data

nal Ordinal Ratio

Nominal Ordinal Interval
Interl Ratio

Qualitative Quantitative
Qualitative
(Categorical) Quantitative

Numeric
Nonnumeric Numeric Numeric
Numeric

Discrete or
Discrete
Continuous
 Descriptive vs. Inferential Statistics

•Descriptive Statistics — using data gathered on a

group to describe or reach conclusions about that
same group only

•Inferential Statistics — using sample data to reach

conclusions about the population from which the
sample was taken
 Descriptive & Inferential Statistics
Descriptive Statistics Inferential Statistics

• Organize • Generalize from

samples to pops
• Summarize
• Hypothesis testing
• Simplify • Relationships
• Presentation of among variables
data

Describing data Make predictions

 Summary Statistics
describe data in just 2 numbers

Measures of variability
Measures of central tendency • typical average variation
• typical average score
1. range: distance from the
lowest to the highest (use 2
data points)
2. Variance: (use all data points)
3. Standard Deviation
4. Standard Error of the Mean
Mean
• The most common and most
useful average
• Mean = sum of all observations
number of all observations
• Observations can be added in
any order.
Notation
• Sample vs population
• Sample mean = X
• Population mean =μ
• Summation sign =
• Sample size = n
• Population size = N
 Arithmetic Mean
Arithmetic mean is a mathematical average
and it is the most popular measures of central
tendency. It is frequently referred to as ‘mean’ it
is obtained by dividing sum of the values of all
observations in a series (ƩX) by the number of
items (N) constituting the series.
Thus, mean of a set of numbers X1, X2,
X3,………..Xn denoted by x̅ and is defined as
 Arithmetic mean of Individual Series
• Direct method:

• Indirect method :

• Step deviation method : =

The following table gives the monthly income of 10 employees in an office. Income (in Rs): 1780,
1760, 1690, 1750, 1840, 1920, 1100, 1810, 1050, 1950. Calculate the A.M

Employee Income(in Rs) x d=(x-1800)

1 1780 -20
2 1760 -40
3 1690 -110
4 1750 -50
5 1840 +40
6 1920 +120
7 1100 -700
8 1810 +10
9 1050 -750
10 1950 +150

n=10 16,650 -1350

Arithmetic mean of Discrete series
 Example: From the following data of the marks obtained by 60 students of a class.

Marks 20 30 40 50 60 70
No of students 8 12 20 10 6 4
 Arithmetic Mean in case of Continuous Series

• Direct Method :

• Short cut method :

• Step deviation Method :

 Case 1: Correcting incorrect values
•
•
 Practice problems
• The average dividend declared by group of 10 chemical companies
was 18 percent. Later on, it was discovered that one correct figure,
12, was misread as 22. Find the correct average dividend.[Ans.17]

• The mean of 200 observations was 50. Later on, it was found that two
observations were misread as 92 and 8 instead of 192 and 88. Find
the correct mean. [Ans. 50.9]

• Mean of 100 observations is found to be 40. If at the time of

computation two items are wrongly taken as 30 and 27 instead of 3
and 72 . Find the correct mean. [Ans. 10.18]
Complete Data are not given
 Marks Frequency f.x
40 8 320
50 10 500
60 9 540
70 6 420
80 4 320
90 3 270
Total 40 2370
Total marks of all the students= 50×51.6= 2580
Total marks of 40 students who passed= sum of fx=2370
Thus, marks of the remaining 10 students =2580-2370= 210
Hence, the average marks of 10 students who failed are 210/10=21 marks
 Missing Frequency
The arithmetic mean is 34 marks. Find the missing frequency from the following data: .
Marks 0-10 10-20 20-30 30-40 40-50 50-60
No. Of Students 5 15 20 --------- 20 10

Marks F Mid value( M) f.m

0-10 5 5 25
10-20 15 15 225
20-30 20 25 500
30-40 X 35 35X
40-50 20 45 900
50-60 10 55 550
Total N= 70+ X
 Practice problems
EX-1: The A.M is given as 28. Calculate the missing value of the following data. [ Ans. 20]

Profit per shop 0-10 10-20 20-30 30-40 40-50 50-60

No. Of Shops 12 18 27 ---------- 17 6

Ex-2 : Find the missing frequency from the following distribution of which the mean is 17.
Marks: 0-5 5-10 10-15 15-20 20-25 25-30
No. Of students 5 15 20 ? 20 10
 Property of Arithmetic Mean
•
Property 2
The sum of squared deviations from the mean would be less than the
sum of squared deviations from any other value.
Or
The sum of the squares of the deviations of a set of values is minimum
when taken about mean.
Show that Σ(X - c)2 is a minimum when c = .

Differentiate with respect to c. ( As we know at minimum, first derivative is zero)

Set derivative to zero and solve for c.

•
•
The combined mean of the two samples
=