Module 1 - Section 1

Introduction to Statistics

By: Rosana Fok

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What is (are) Statistics?
u Statistics is a way of reasoning, along with a collection
of tools and methods, designed to help us understand
the world with the use of data.

or

u Statistics (plural) are particular calculations made from

data.

In this course, we will cover statistical theory, including the

collection, the organization and the interpretation of
data. 2
What are Data?
u Data are values with a context.
u They can be numbers, record names, or other labels.

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Why we need to collect data?
u to find answers to the questions that cannot be
answered otherwise
u Ex: what is the long-term effect of a specific
medication?
u Ex: what is the attendance rate of my Intro Statistics
class?
u Ex: is there a relationship between the attendance rate
and students’ performance on their exam?
OR
u an experiment usually results in different outcomes
(variability) and we want to study the reason(s) for the
variability
u Ex: different concentrations of chemical in water
samples at a sewage treatment plant.
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Statistical methods are used in:
u Politics: What proportion of voters think the
government is doing a good job?
u Biology: Does water quality based on water specimens?
u Medicine: Is a new migraine drug more effective than
the old drug?
u Psychology: Would men or women tend to get jealous
more easily?
u Social Science: Are there any changes in the proportion
of women working outside their homes?
u Engineering: What is the chance that a machine fails in
warranty period?
u Dentistry: Does fluoride in salt increase the hardness
of your teeth?

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Statistical methods are used in:
u Business:
u Accounting:
u What are the expected earnings and cash flow for the
company this year?
u Finance:
u What is the risk on a particular stock?
u Is this client’s investment portfolio too risky?
u Marketing:
u How much food should a restaurant owner order?
u How can a restaurant owner improve their customers’ drive-
thru experience?
u Which product should a store sell?
u Human Resource:
u Do we have enough employees as the company expands?
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Statistical methods are used in:
u Economics:
u How does the stock market affect gas prices?
u Why is there a relationship between Gross Domestic
Product (GDP) and the business cycle?
u What is the right price to set for this product so that
it will maximize the firms’ profit?
u Personal life:
u which route should I take to school?
u Should I wear sandals or rain boot?
u Which store should I buy my groceries from?

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The process of making a data
driven decision:
1. State the question!
2. Decide how to collect the data and which statistical methods
have to be applied to answer the question or to make a
decision.
3. Collect the data = Draw a sample from the population of
interest.
4. Describe and summarize the data. Find the statistics.
5. Use appropriate statistical tools, to find answer to question.
Use formal data analysis and make statistical inference. In
other words, generalize the finding from the sample to the
entire population, if possible.
u NOTE: In order to understand and apply inferential
procedures, we need to understand Probability Theory.
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Goal of this class
u Learn appropriate methods for data collection
u Learn how to formulate, carry out, and interpret
simple statistical analyses
u Learn how to follow basic statistical arguments
u Develop a critical attitude toward quantitative claims
u Develop statistical reasoning
u Summary: Become capable of making decisions
based on data