STATISTICAL ANALYSIS WITH SOFTWARE APPLICATION
QUIZ 1
STATISTICS
● the branch of mathematics that transforms
data into useful information for decision
makers.
➜ DESCRIPTIVE STATISTICS
★ Collecting, summarizing,
and describing data
➜ INFERENTIAL STATISTICS
★ Drawing conclusions and/or
making decisions
concerning a population
based only on sample data
WHAT IS STATISTICS? (Doane & Seward,
2019)
● is the science of collecting, organizing,
analyzing, interpreting, and presenting
data.
● A STATISTIC is a single measure, reported
as a number, used to summarize a sample
data set; for example, the average height
of students in a university.
● Examples of statistics:
➜ average height for the length of the
gowns
➜ maximum height to design the
height of the doorways of the
classrooms, etc.
USES OF STATISTICS (Doane & Seward,
2019)
● AUDITING
➜ The firm has learned that some
invoices are being paid incorrectly,
but it doesn’t know how widespread
the problem is. A sample of invoices
can be used to estimate the
proportion of incorrectly paid
invoices.
● MARKETING
➜ Many companies use Customer
Relationship Management (CRM)
to analyze customer data from
multiple sources. With statistical
and analytics tools such as
correlation and data mining, they
identify specific needs of different
customer groups, and this helps
them market their products and
services more effectively.
● HEALTH CARE
➜ Evaluate 100 incoming patients
using a 42-item physical and
mental assessment questionnaire.
● QUALITY IMPROVEMENT
➜ Initiate a triple inspection program,
setting penalties for workers who
produce poor-quality output.
● PURCHASING
➜ A food producer purchases plastic
containers for packaging its
product. Inspection of the most
recent shipment of 500 containers
found that 3 of the containers were
defective. The supplier’s historical
defect rate is .005. Has the defect
rate really risen or is this simply a
“bad” batch?
● MEDICINE
➜ Determine whether a new drug is
really better than the placebo or if
the difference is due to chance.
● OPERATIONS MANAGEMENT
➜ Manage inventory by forecasting
consumer demand.
● PRODUCT WARRANTY
➜ Determine the average dollar cost
of engine warranty claims on a new
hybrid engine.
KINDS OF STATISTICS (Doane & Seward,
2019)
● DESCRIPTIVE STATISTICS
➜ refers to the collection,
presentation, and summary of data
(either using charts and graphs or
using numerical summary).
● INFERENTIAL STATISTICS
➜ refers to the generalizing from a
sample to a population, estimating
unknown population parameters,
drawing conclusions, and making
decisions.
SOME DEFINITIONS
● VARIABLE
➜ is any characteristic of a person or
an object that may vary across
persons or across different time
points.
Age Student number Asset size
Quiz scores Civil status Place of birth
● DATA
➜ are the values associated with a
variable. For the variable civil
status, possible data are single,
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 married, separated,
Sophomore, Junior,
widow/widower.
Senior

Height 5’6” 1.75 165 cm S&P’s bond ratings AAA, AA, A, BBB, BB,
meters B, CCC, CC, C, …
b. Numerical or Quantitative
Academic Strand ABM STEM GAS
Variables
★ An interval scale is an
CLASSIFICATION OF VARIABLES ordered scale in which the
1. According to nature difference between
a. Categorical or Qualitative measurements is a
Variables meaningful quantity but the
★ Categorical or Qualitative measurements do not have
Variables have values a true zero point.
which can be placed into ★ A ratio scale is an ordered
categories. scale in which the difference
★ Examples of categorical between measurements is a
variables are gender, civil meaningful quantity and the
status, frequency measurements have a true
b. Numerical or Quantitative zero point.
Variables
★ Numerical or quantitative Numerical Variable Scale or Level of
variables have values that Measurement
represent quantities.
★ Examples are height, Temperature (in oC or Interval
weight and temperature oF)
2. According to scale
a. Categorical or Qualitative Standardized Exam Interval
Variables Score (SAT or NSAT)
★ A NOMINAL SCALE is
used to classify persons (or Height Ratio
objects) in which NO
ranking is implied. Weight Ratio

Age Ratio
Categorical Categories
Variables Salary Ratio

Car Ownership Yes / No Industry Index Ratio

Profession Engineer, Architect,

Teacher, others
STATISTICAL TECHNIQUES FOR
Work shift Day shift/night shift DESCRIBING UNIVARIATE DATA
Scale or Level of Measurement

★ An ORDINAL SCALE is
used to classify persons (or Nominal Ordinal Interval Ratio
objects) into distinct
Tables Frequency Frequenc Frequency Frequency
categories in which ranking and y and and and
is implied. Percentage Percenta Percentag Percentag
(Summary ge e (FDT) e (FDT)
Table) (Summar
Categorical Categories y Table)
Variables Charts Pie chart Pie chart Histogram Histogram
bar graph bar graph Line Line
Customer satisfaction Satisfied, Neutral, Not Graph Graph
Satisfied
Central Mode Mode and Mean, Mean,
Tendency Median Median Median
Student’s Year level Freshman, and Mode and Mode

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 Variations Range Range, Range, ● It is affected by extreme values.
and standard standard ● The mean of a separate distribution can be
interquarti deviation, deviation, combined to get the mean of the total
le range variance variance
and coeff. and coeff. distribution.
of variation of variation ● What is the mean of the distribution: 713,
300, 618, 595, 311, 401, and 292?
MEASURES OF CENTRAL TENDENCY ● The number of tornadoes that have
● This is a statistical measure which occurred in the United States over an 8-
describes where the center of a frequency year period were as follows. What is the
distribution lies. mean?
● The three measures commonly used are ➜ 684, 764, 656, 702, 856, 1133,
the mean, the mode and the median. 1132, 1303
● Some variations of the mean are the
arithmetic mean, geometric mean, WEIGHTED MEAN
weighted mean and the trimmed mean.

MODE
● It is simply the observation or value that
occurs most frequently in the data set.
● What is the mode given the following: A, A,
B, C, B, C, D, A, A? How do you call the
distribution with respect to the mode?
Mode = A, distribution is unimodal
● What is the mode of the distribution: 10, 10,
20, 20, 30, 30, 20, 30? How do you call the
distribution with respect to the mode?
Mode = 20, 20; distribution is bimodal.
● What is the mode of the distribution: 500,
500, 700, 600, 700, 600? How do you call
the distribution with respect to the mode?
➜ Answer: Mode = { } or none. The
GEOMETRIC MEAN
distribution has no mode.
● This measure is useful for growth rates.
● The mode is suitable for nominal, ordinal,
● It mitigates high extremes.
interval and ratio level variables.
● It is, however, less familiar.
● It is not affected by extreme values.
● It requires that data is positive.
● There may be no mode.
● There may be several modes.
𝐺 = 𝑛√𝑥1 𝑥2 . . . 𝑥𝑛
MEDIAN
● It is simply the middle score or middle value TRIMMED MEAN
when scores are ranked in order of ● Computed in the same manner as the
magnitude. arithmetic mean but it omits the highest and
● It is unique. lowest k% of data values (e.g., 5%).
● It is relatively unaffected by extreme scores ● It mitigates the effects of extreme values.
at either end of the distribution. ● It has the disadvantage of excluding some
● Not all values in the distribution contribute data values that could be relevant.
to the value of the median.
● It can be used with ordinal, interval and MEASURES OF POSITION
ratio data. ● A measure of position, or quantile, is a
● It is not suitable for nominal data because general descriptive measurement used to
nominal data have no numerical order. separate quantitative data into distinct
MEAN groups. To compute quartiles of ungrouped
● The mean of a set of numerical data is data, the values must first be arranged
unique. either in ascending or descending order.
● It is the only measure of central tendency ● Quartiles divide the values into four groups
where the sum of the deviation of each of equal size, each comprising 25% of
value from the mean will always be zero. observations. If n = 50, 25% of the values
● It includes precise information from every is less than or equal to 𝑄1.
score, hence, it is affected by a change in ● Deciles divide the values into ten groups of
any score. equal size, each comprising 50% of
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 observations. If n = 50, 30% of the values
is less than or equal to D3.
● Percentiles divide the values into 100
groups of equal size, each comprising 1%
of observations. If n = 200, 65% of the
values is less than or equal to P65.
MEASURES OF VARIABILITY
● Variation measures the spread, or
dispersion, of values in a data set.
➜ Range
➜ Quartile Deviation
➜ Variance
➜ Standard deviation
➜ Coefficient of Variation
● It measures the difference of each value
around the mean.
● It functions as a measure of risk or
uncertainty in the field of finance.
● It provides a measure of volatility in
considering alternatives for pricing
commodities.
● It may be used as a measure of error in the
field of forecasting.
RANGE
● The range of a set of data with n
observation is defined as the difference
between the highest and lowest values.
● The quartile deviation, QD, is the amount
of spread with the middle half of the items
arranged in an ordered array. It is also
called semi-interquartile range. It is used
for ordinal data.
VARIANCE
● The variance is the average
(approximately) of squared deviations of
values from the mean.
COEFFICIENT OF VARIATION
● The coefficient of variation is the standard
deviation divided by the mean, multiplied
by 100.
● It is always expressed as a percentage, %.
● It shows variation relative to the mean.
● The CV can be used to compare two or
more sets of data measured in different
units (e.g. weight in kgs and height in
meters).
SUMMARY CHARACTERISTICS
● The more the data are spread out, the
greater the range, quartile deviation,
variance, and standard deviation.
● The more the data are concentrated, the
smaller, the quartile deviation, variance,
and standard deviation.
● If the values are all the same (no variation),
all these measures will be zero.
● None of these measures are ever negative.
TABLES AND CHARTS FOR
CATEGORICAL DATA
Summary Table
● A summary table indicates the frequency,
amount, or percentage of items in a set of
categories so that differences in categories
can be seen.
Bar Chart
● A bar chart shows each category, the
length of which represents the amount of
frequency or percentage of values falling
under each category.
Pie Chart
● A pie chart shows a circle broken up into
slices that represent categories. The size of
each slice of the pie varies according to the
percentage in each category.
TABLES AND CHARTS FOR NUMERICAL
DATA
Stem and Leaf Display
● A stem and leaf display organizes data into
groups (called stems) so that the values
within each group (the leaves) branch out
to the right on each row.
Frequency Distribution Table
● A frequency distribution table is a summary
table in which the data are arranged into
numerically ordered class groupings.
Histogram
● A histogram is the graph of data in a
frequency distribution where the class
boundaries are shown on the horizontal
axis while the vertical axis is either
frequency, relative frequency or
percentage. Bars of the appropriate
heights are used to represent the number
of observations within each class.
Line Graph
● A percentage polygon is formed by having
the midpoint of each class represent the
data in that class and then connecting the
sequence of midpoints at their respective
class percentages.
Scatter Plots
● A scatter plot is used for numerical data
consisting of paired observations taken
from two numerical variables.
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● One variable is measured on the vertical
axis while the other variable is measured
on the horizontal axis.
● In case of dependence relationship, the
dependent variable is plotted along the
vertical axis.

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