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 Unit-1 Introduction to statistics
Statistics means any numerical data (information). Therefore, statistics is recording, classifying
and analysis of numerical data.

Examples: 1 India literacy rate is 74.04%in 2011 compared to 64.83% as per 2001 census. The
literacy rate is highest in Kerala at 93.91% and lowest in Bihar at 63.82% in 2011.

2. The richest country in the world $80800 gross domestic product (per capita income) and the
second country is Qatar with $75900.

Origin/history and development of statistics

Statistics is derived from Latin word “status”, Italian word “Statista” German word “statistik”.
All these words mean political state.

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 In the early years statistics means collection of facts about the state or people
in the state for political purpose. Thus it helped in collecting the data about economic and social
conditions of people living in different parts of the country .

In the early days king used to collect the information about the people in their
state , it is essential to know the conditions under which the people live and work, their , health,
income, land and buildings , other assets and their military strength in order to plan for new
taxes and to fund wars. Therefore, statistics is known as “science of kings” or science of “state
craft” because the data was used by the state.

Statistics is as old as human civilization. One of the earliest known statistics is

the census conducted by emperors of Egypt in connections with the construction of
“pyramids”. Statistics have been used in India even before 300 b.c proof of statistics is found in
ancient literature of Kausalya’s arthashastra.

During 15th and 16th century statistics developed as a science in association with
mathematics. For few centuries’ statistics remind part of mathematics. After industrial
revolution 1930, there were sudden changes in socio economic life of people. So gradually, in
18th and 19th century statistics developed as a separate branch of science.

During 17th century John Ggraunt (father of vital statistics) it is a study of birth
and death rates. The computation of mortality tables and calculation of life expectancy at
different stages led to the establishment of” life insurance institution “. In London in 1698.

In 1749 gottfried achenwell was the first person to use the term statistics as a
subject matter and he defined it as political science of several countries. He is regarded as the
father of statistics.

Some of the prominent statisticians are Karl Pearson founded the greatest
statistical laboratory in England. fisher pioneered the study estimation theory and also applied
statistics to various diversified fields such as genetics , agriculture, biometry , psychology,
education etc.

There has been a great contribution to the science of statistics in 19 th and 20th
century. The modern theory of statistics is formulated by Lay Quett let who introduced the
concept of a averages and deviation from averages.

Definition and features

In plural sense: Statistics as a numerical data

In singular sense: statistics as statistical Method

Definition of statistics in plural sense:

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According to Horace Secrist “statistics means aggregate of facts , affected to a market extent by
multiplicity of causes, numerically expressed , enumerated or estimated according to reasonable
standard of accuracy , collected in a systematic manner, for a predetermined purpose and placed
in relation to each other.”

Feature/elements/characteristics of statistics in plural sense/statistics as numerical data:

(or)

“All statistics are numerical statement of facts but all numerical statements of fact are not
statistics.”

1. Aggregate of facts:

Statistics is concerned with group of facts rather than a single fact i.e, single and
isolated/unrelated figures are not statistics.

Eg: ram a student got 100 marks in statistics is not statistics, but if the marks secured by
entire class is recorded than it will be statistics.

2. Affected to a market extent by multiplicity of causes:

Numerical facts are not affected by one factor but are affected by a large number of
factors.

Eg: the prices of vegetables has increased by 80% in 2011 compared to 40% in 2010. The
reason for increase in price of commodity are demand and supply natural calamities price
of competitive products.

In physical science it is possible to isolate the effect of various factors on a single item
but statistics are commonly used in social sciences. It is very difficult to study the effect
of any one factor separately. in statistical methods the effect of various factors effecting
a particular phenomenon are studied in a combined form through attempt is also made to
study the effect of different factors separately as well.

3. Numerically expressed:

Only numerical data can be called as statistics, qualitative expression like good, bad,
excellent, hard working, poor are not statistics.

Eg: production of rice has increased in India is not statistics but the production of
statistics in India in 2003-2004 is 86.4 million tons compared to 72.66 million tons in the
year 2002-2003.

4. Enumerated or estimated according to reasonable standard of accuracy:

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Data can be collected either by enumeration or estimation. The data collected by enumeration is
more exact and accurate. Estimated figures may not be absolutely accurate. If the number of
observation is small than enumeration is used but if the numbers of observation are large then
estimation can be used. The degree of accuracy depends to a large extent on the purpose for
which the information is collected and the nature of particular problem about which the data is
collected. these cannot be uniform standard of accuracy for all types of data collection.

Eg: while collecting marks of a student or no. of votes got by a candidate in the election, it is
necessary the data should be accurate. But while calculating number of people watching cricket
match in a station then estimation can be used.

5. Collected in a systematic manner:

For accuracy and reliability the data should be collected in a systematic manner. Data collected
in haphazard manner may not give accurate result and attempt should be made to reduce personal
bias to the minimum while collecting the data.

6. For a predetermined purpose:

The purpose of collecting the data should be predetermined otherwise the data collected may not
serve any purpose and become useless. One should not waste time and money in collecting the
info which is irrelevant for the enquiry.

Eg: for the purpose of knowing the cost of living of poor people then we should collect
information about the items.

Consumed by poor people but if we collect the information about cars refrigerators air
conditioner is useless.

7. Placed in relation to each other:

Statistical info is collected for the purpose of comparison. if the data collected cannot be
compared then the purpose will be waste. The info collected should be homogeneous and not
heterogeneous in character, so that comparison is possible.

Eg: different data relating to population of a country different years or population of different
countries in some fixed period will be statistics. it would be meaningless to compare the height
of human being with that of giraffe or weight of a human being with that of elephant.

Definition of statistics in singular sense/statistics as statistical method.

According to croxton and cowden,” statistics is the science of collection, presentation analysis
and interpretation of numerical data.

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According to Seligman,” statistics is science which deals with the methods of collecting ,
classifying, presenting, analyzing and interpreting numerical data collected to throw some light
on spheres of enquiry.

Features of statistics in singular sense statistical method:

1. Collection of data: it is first step in statistical investigation. great care must be taken in
collecting the data because they form the foundation of statistical analysis. If the data is
faulty then conclusions can never be reliable. The data may be collected either by the
investigator himself or may be available from any unpublished sources.

2. Organizing: if the data collected is large, then it should be organized.

There are three stages in organizing:

a. Editing: it refer to detecting any errors or irregularities committed while collecting the
data..

b. classification: it refers to arrangement of data according to common features.

c. Tabulation: it refers to arrangement of data in rows and columns.

3. Presentation: after collecting and organizing the data should be presented in the same
suitable manner either by diagrams or graphs or charts because the data can be easily
understandable and have greater memorizing effect which facilitates comparison.

4. Analysis: once the data is collected organized and presented, the next step is analyzing
the data. The objective of analysis is to prepare the data in such a fashion to arrive at
definite conclusion. the most commonly used methods are measures of central tendency
dispersion, skewness, correlation, regression.

5. Interpretation: it is the last step in statistical investigation to derive meaning from

analyzed data. It is the final conclusion drawn from analyzed data. It is difficult task and
need high degree of skill and experience. If analyzed data is not properly interpreted then
the whole purpose of enquiry becomes erroneous. it is only correct interpretation which
may lead to reliable conclusion.

Scope of statistics

Subject matter of statistics nature of statistics

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 Statistical Methods
Applied statistics

1. Descriptive

2. Scientific statistics
1. As an art
3. Analytical
statistical methodstatistics
2. As a science
4. Inferentialstatistics
1. Descriptive statistics

2. 5. Inductive statistics

Applied statistics: it deals with application of statistical methods to specific problem, like
population, national income, price etc. eg: if a software firm is experiencing attrition (loss of
employee).so it is necessary to investigate the reasons. Therefore, correlation analysis would
indicate that increasing of opportunities and attrition are highly correlated. All such technique
and the result obtained by employing such technique form part of applied statistics.

Applied statistics is further divided into :

1. Descriptive statistics: it deals with data that is known and which relates to past and present
. it consist of those statistical methods which tells us how to describe the characteristics of
data . it deals with collection , tabulation, presentation of data and calculation of measuring
of central tendency, dispersion etc. business statistics is descriptive statistics and it is
concerned with analysis , measurement and presentation of business facts.

2. Scientific statistics: it deals with formulation of statistical laws. These laws are based on
quantitative data and generally hold true. Scientific statistics is used for the purpose of
business forecasting. Eg : probability.

3. Analytical statistics: it includes methods like correlation, regression etc, that helps in
establishing functional relationship between variable. Two or more sets of data are compared
and analyzed to arrive at the relationship between them. Such relationship could be
continuous or at a defined period of time.

4. Inferential statistics: it deals with those methods were conclusion about large group are
drawn by studying a part of it using random sampling, techniques. No guess work is done.
the size of sample, criteria for inclusion of a person /activity/ thing into a sample are all
clearly defined. Based on the result of study on sample, inferences about that population can
be drawn.

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5. Inductive statistics: statistical methods that help in arriving at general consensus based on
study of random observation are part of inductive statistics the sample chosen may not be
representative and hence the conclusion arrived at need to be double checked.

Statistics as a science:

Science is a systematized body of knowledge. It studies cause and effect relationship between
different variable and comes up with principles that are universally applicable.

Example: law of gravity, Archimedes principle etc. from this stand point statistics can also be
considered as science. It is also involved in study of cause and effect. it has come up with its own
set of principle/ method that are widely used across various fields and help in arriving at some
laws. It establishes cause and effect relationship among data collected and conclusion.
Principles of science have high degree of precision as compared to statistical principles because
in science the factor can be isolated and tested in laboratory which is not possible in statistics.
hence statistical laws cannot be expected to have some degree of accuracy. Thus, statistics can be
termed as social science. It is more of a scientific method than a science itself.

Science as an art

Art is an expression of skill and creativity. it is not concerned with cause and effect analyses. It
is concerned with doing things that cannot be done by everybody. it demands rigorous practice to
such skills paintings, singing, dancing are examples of art….

Statistics can be considered as an art as it is concerned with skill of handling facts and figures.
Statistics are very innovatively and creatively used in analysis and presentation of data. In
statistics we apply various method to obtain facts, derive conclusion and finally to suggest policy
measures. in statistics we not only study different method of studying a problem/topic but also
study how these methods should be applied in different situation. Statistics helps in
understanding and solving problems of real life by providing quantitative information.

Statistics is neither pure science nor pure art. Jippet says that” statistics is both science and art”.
It is science because its methods are basically systematic and have general; application and art
because their successful application depends to e considerable degree on the skill and special
experience of statistician. Therefore, stats is a scientific method that can be artistically used for
the benefit of mankind.

Function of statistics

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1. To present facts in definite form: facts are expressed in numbers easily understood.
Statement of facts expressed in quantitative term are not convincing than a vague utterance. Eg:
during recent floods there was heavy loss to agriculture. This statement is not clear, but if it is
stated that during flood crops worth 10 lakhs was destroyed is clearer.

2. simplifies the data: the function of statistical method is to simplifying large mass of
numerical data and present them in a more intelligible form. Statistical methods helps in
reducing complex data into simple figures which can be interpreted more accurately i.e it helps
in simplifying complex data so as to make them understandable. The methods used are methods
of central tendency, dispersion etc.

3. comparison: after simplifying the data, it can be correlated and compared. Stats enables
impartial and fair comparison of data across a wide range of competing alternatives. The
relationship between two groups is best presented by statistical devices like averages etc.

4.Formulation and testing of hypothesis: it means something to be tested or proved statistical

method are extremely useful in formulating and testing of hypothesis and to discover new theory
stats has developed with its own theories, principles, methodology which can be used to answer
specific queries. A statistician can take the help of stats and use sampling techniques and
principles to arrive at a decision. whether chloromycetin is effective in curing typhoid, whether
students are benefited by coaching? Etc

5. Helps in prediction /forecasting: statistical methods are very useful tool in attempting to
forecast the future forecasting means making estimates for future based on past and present
behavior.

Eg: if an investor wishes to purchase shares of reliance industry, he can use statistics to find
whether the share prices are likely to increase or decrease. He can use correlation and
regression methods to know the impact of some key factor on the performance of the
company and then take a decision.

6. Helps in policy formulation and decision making: with the help of statistics the
government can frame suitable policies.

Eg: data about population, its distribution by age and gender helps the govt in determining the
future needs such as food , clothing, housing ,educational facilities , water etc. similarly detailed
info on the unemployed person their qualification, experience etc will help the govt in framing
policies to tackle unemployment problem.

7. To study relationship between various phenomena: statistics enable to observe and

understand the relationship between different facts/phenomena. Eg: relationship between demand

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and supply, rainfall and agricultural production can be best measured with the help of statistical
method like correlation.

8. Enlarge individual experience: the function of stats is to large human experience and
knowledge. statistics make it easier for a man to understand, describe and measure the impact of
any action. It improves scientific facts without stats man may not be able to acquire knowledge
quickly and he may not take long time to bring drastic changes. statistics helps in solving
problems in various fields like political, economic, social or cultural.

9. Measures uncertainty: statistics helps to take decision on the face of uncertainty and study
the chance of accuracy of certain events. it also helps in finding out the impact of happening of
an event. It helps mankind to cope with uncertainty.

10. Measures the effect: statistics helps not only in formulating a policy but also help in
measuring the affect of a policy. Statistics act as guide. Eg: the effect of change in bank rate , tax
rate can be studied with the help of stats.

11. To classify the data: statistical methods help to arrange data according to common features.
This facilitates analysis and comparison.

12. To draw valid inferences: in fields of business and economics many times rational and valid
conclusion are drawn by collecting and analyzing available facts.

Importance/uses of statistics:

The scope of statistics is very wide. It is used in all sciences wherever research is involved.
There is hardly any field says industry , commerce, trade are economics or physics or astronomy
etc. where statistics is not used. The application of statistics is so numerous that it is often
remarked- “statistics is what statistician do”.

1. Statistics and the state: statistics were developed as a science of kings depended heavily
on statistics for knowing manpower for defence purpose. The statistics collected by a
king were a by-product of administrative activity. Modern states being welfare-oriented
states, the collection of stats is done to solve various problem and to frame suitable
policies to solve these problems. The problem may be pertaining to family planning or
transport , communication etc. the data is collected by the government either for its own
purpose or for the purpose of researchers. Some statistics are exclusively collected by
government.

Eg: population census. All ministers or department of govt of India whether finance, defence,
railways post, telegraphs, agriculture depend on factual data for their efficient functioning. Stats
are useful not only during peace time but also during war once we know statistics it is very easy
to frame policies even during crisis.
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 2. statistics and business: a good businessman make a good sales prediction keeping in
view of all types of seasonal and market variation. In modern business it is due to
availability of data that suitable policies can be followed in case of production, finance,
investment, marketing etc.

Some of the key areas of importance of statistics in business are as follows:

a. Market analysis: marketing research provide solution to various problems involved in

marketing goods, services or ideas. In this context systematic collection, analysis and
interpretation of marketing data is done by using statistical methods, marketing decision
involve introduction of new products, reaction of consumers to prices, effectiveness of
advertisement company.

b. Cash forecasting: financial analyst has to forecast cash requirement to meet short term
obligation like payment of salary, payment to supplier etc statistics analysis helps in
working out realistic cash forecasting.

c. Finance: key financial ratio are worked out by using the balance sheet and profit and loss
account to know the financial health of an enterprise comparative statistical analysis
reveals the performance of the company in the past years and emerging trends in the
future. `

d. Material management: by using appropriate statistical methods one can maintain

optimum inventory stock levels of raw material and finished products and thus savings
are made which has impact on profit.

e. Quality management : statistical principles from the basis of carrying out quality
assurances exercises. Raw material and other item are checked for quality to meet
customers’ needs and inspection of finished product is done on sample basis to reduce
complaint from customers.

f. Demand projections: short term and long-term demand projection are required for the
company products and services both for domestic and international market. Statistical
survey and analysis of the past data relating to industry provide reliable sales and demand
projection.

3. Statistics and mathematics: according to F.C.Mills “statistics an offspring of

mathematics. Both are very closely in touch with each other over since 17th century. Both
have helped jointly in the development of other social and physical sciences. law of
inertia of large numbers and law of statistical regularity which are the basis of modern
theory of stats formulated in the mathematical theory of probabilities. Mathematical
averages, coefficient, graphical presentation is used in containing statistical data. Algebra

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 is very helpful in the field of statistics. Mathematics has helped in the growth and
development of various economic theories having links with statistics.

4. Statistics and economics: statistical data are a powerful aid in economics and its
analysis. the study of every economic problem requires the use of statistical methods.
Some of the key areas of importance of statistics in economics are:

a. Consumption: statistics of consumption enables us to find out the ways in which

people of different classes of society spend their incomes. Some statistics are very
helpful in knowing the standard of living and the taxable capacity of the people.

b. Distribution: with the help of stats the national wealth of the country is estimated and
its distribution among the people of the country is found out. equitable distribution of
national income and wealth is another series problem to be best studied statistically.

c. Exchange: in the field of exchange we study markets, laws of prices based on supply
and demand, cost of production etc. eg: questions like what price a monopolist
charge in order to reap maximum profits? What shall be the price of particular
commodity if its supply is increased or decreased? Can be best answer with the help
of statistics.

d. Production: statistics of production helps to adjust to supply according to demand.

The productivity of different factor of production can be compared. Census of
production helps in understanding the economy or taking corrective measures
wherever necessary.

e. Public finance: it studies the revenue and expenditure activities of the state. Stats is
useful to the finance minister who prepare annual budget and outline the fiscal policy,
deficit financing, nature and amount of subsidies on the basis of stats collected in the
various department.

f. Monetary policy: it is the policy of the central bank of a country. Bank rates, selective
credit control, cash reserves ratio etc are the chief weapons of monetary policy. All
the concept is statistical in nature.

g. Macroeconomic concept: the world wide recession of 1930 necessitated the study of
national income aggregates. What should be the increase in national income if the
investment in the country is increased by 100crores / how much consumption will be
affected if the national increases or decreases by some fixed amount? the modern
economist lays a great stress on these concept and theories which are statistical in
nature.

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 h. Input and output analysis: it is based on statistical data which explains the
relationship between the input and output. Probability, sampling, regression,
correlation, time series, index numbers etc are the concepts used in economic
analysis.

i. Econometrics: it is a product of 20th century. It is the combination of economics,

maths, and stats. It studies the application of statistical techniques to the economic
methods. The study of consumption function, production function, exchange and
distribution have been possible with the help of statistical methods. The subject is
gaining importance and it is now called research methodology in economics. It is
assumed that with the help of econometrics, economics will become an exact science.

5. Statistics in planning: the under developed countries can grow only if they have sound
planning system. The problem like over population, unemployment, lack of
industrialization low rate of capital formation etc. can be solved only with the help of
statistical data/facts. We need planning at all levels making good plan do not serve the
purpose. Our plans must be supported by adequate statistics. Therefore, sound planning
should be based on sound data. National income is produced but the contribution of
agriculture, industry, transport, trade and other services can be known only if we collect
data. This will also determine how much funds to be allocated ton different sectors. All
predictions are possible only with the help of statistics.

6. Statistics and physical and natural science: in physical science like astronomy geology,
physics, statistical methods are used. The importance of stats has further increased due to
their use natural sciences like medicines meteorology, botany , zoology, etc. karl pearson
applied statistical methods to biology. he showed that doctrine of evolution and heredity
is based on statistical bases, the statement that tall father have in general tall sons can be
proved by statistical data.

7. Statistics and other uses:

a. Stats is the arithmetic of human welfare because the problem relating to poverty ,
unemployment , food shortage etc can be analyzed with the use of statistics.

b. Statistical analysis of railways working is very useful in determining the efficiency of

services their requirement and other expansion program.

c. Stats is useful to social reform which has to carry on his activities based on statistics.
the incidence of certain diseases, beggar, problems, child marriages etc all need stats
for their solution.

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 d. Stats is useful to insurance companies because they need exact info on vital statistics
to prepare mortality tables, premium plans etc.

e. Stats are an aid to supervision these days when there is impersonal relationship
between employer and employee.

f. Stats is useful to banker and the banking industry, in deciding policies regarding
deposits advances etc.

g. Stats is useful to economist who prepares economic plan and frame economics
policies for the state.

h. The educationalist makes use of statistics for evaluating the performance of students
and teachers and for chalking out education policy.

i. Stats is of great help to the administrator in performing his social, economic, legal
and other functions.

j. Stats helps the politician to know the social and economic ambitions of the society.

Limitation of statistics

1.Statistics does not study qualitative aspect: statistics are numerical statement of facts. It can
be applied only to such problems that can be measured quantitatively. statistics cannot be used
directly for the study of qualitative characteristics such as honesty, beauty, intelligence, health,
culture etc. however it may be possible to analyze the characteristics indirectly. Eg : we can
study intelligence of students on the basis of marks secured by them in examination.

2. Statistics does not reveal entire study: statistical analysis may focus on only certain aspects
of the study and may not bring to light the entire story. Eg: opposition in USA, to outsourcing
jobs in India is justified citing statistics on job losses. However, if the demographic profile of
USA is studied one finds that America is actually heading for an era of shortage of personnel. a
good statistician must recognize the need to consider all facts and complete story rather than rely
on a few tools of statistical analysis.

3. No cause and effect relationship: statistics does not necessarily bring the cause and effect
relationship between various parameters. The investigator needs to apply judgement to determine
the relationship between the parameters. Eg: if sales and advertisement expenditure of an
organization is studied, it does not tell that there cause and effect relationship between the two. If
fact regression techniques can be applied to find out what would be the advertisement
expenditure for a given figure of sales. This may not be practical as sales does not directly cause
impact on advertisement.

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4. Statistics can be used by expert only: statistical technique is not so simple to be used by any
layman. The technique being complicated in nature can be used only by experts knowing the
application of statistical methodologies Otherwise the result can be misleading and dangerous.
Yule and kendall points out that statistical method are most dangerous tools in the hands of in
experts.

5. Statistics does not deal with individual: stats deal only with aggregates rather than
individual items. A single or isolated figure cannot be regarded as statistics. Eg: an individual
item like height of a student in a class is 5.6 is not statistics, but if we say average height of the
class is 5.8 then it is statistics. In statistical methods we deal with aggregates and not with a
single figure.

6. Statistics results/ laws are true only on a average: statistics as science is not accurate as
other science. Statistical laws are not universally truer like laws of physics, chemistry etc. they
are true only on an average. statistics are not very precise accurate. Statistics are concerned with
those phenomena which are affected by multiplicity of causes. It is not possible to study the
effect of each of these factors separately as we do under experimental methods. Due to this
limitation the conclusion arrived at are not perfectly accurate.

7. Statistics is only a means and not an end: the tools of statistics are only a means to
understand any given problem rather than a method to solve any problem. there are other
methods of studying a problem like culture, religion, philosophy etc statistics is only a means not
an end. It analyses the facts and throw light on real life situation.

8. Statistical results are not always beyond doubt: stats deal with measurable aspects of things
and therefore can seldom give the complete solution to problem. They provide a basis of
judgement but not the whole judgement.

9. statistical results are only approximately correct: it is science of estimates. It fails in the
field of where perfect accuracy is desired.

10. homogeneity of data: for comparison purpose data should be homogeneous and uniform.
quantities measured in different units cannot be compared. Eg: since food grains and cloth are
measured in different units, we can simply compare their values in rupees but not their
quantities.

11. statistics can be misused: statistics can be misused by ignorant and wrongly motivated
person. Any person can misuse stats and draw wrong conclusion. Statistical methods are
dangerous tools in the hands of non experts. biggest limitation of statistics is that it deals with
figures which are innocent and don not bear on their face the label of their quality. They can be
easily manipulated and distorted by dishonest or unskilled users for selfish motives. Statistics
neither proves nor disproves anything. It is merely a tool which is rightly used may prove
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extremely useful but if misused may lead to wrong conclusion. In the words of w.i king statistics
are like clay of which you can make a god or a devil as you please. According to him science of
stats is useful servant but only of great value those who understand its proper use. Then example
of wrong interpretation. In India the percentage of death among sick person is higher in hospital
than at home was stated by a person who collected information of deaths in hospitals and at
home. This may lead to conclusion that more person die in hospital than at home due to lack of
proper treatment and care. But the investigation failed to face into consideration the fact that in
India only seriously ill persons are hospitalized.

Distrust of statistics:
There are three types of lies-lies, damned lies and statistics wicked I the order of their naming.

(or)

Statistics neither proves nor disprove anything.

Distrust of stats means lack of confidence in statistics. The following are some of the
remarks that are generally passed against statistics.

a. Statistics can approve or disapprove.

b. There are 3 kinds of lies ,-lies, Damned lies and statistics wicked in the order of their
naming . stats is likely clay of which one can make god or devil.

The interested parties misuse statistics. It is publicity and advertisement through which
big business houses and other organization try to promote their sectional interest .They
manipulate statistics in such a way so that these may serve their purpose. According to Yale
and Kendall , “statistical methods are most dangerous tool in the hand of inexpert”.

Reasons of distrust of statistics:

1. Stats is data and it can be collected in a fake way , but one cannot differentiate.

2. People believe data because data is group of numbers . Numbers stand for perfection
and accuracy. When we say performance of students in the exam is good. They do not
believe it . If we say pass% is 90 then everybody believes it, this is the magic of numbers
and psychology of people.

3. Numbers or data by their nature are accurate and innocent. But people who use the data
misuse it by incorporating false or individual data. Sometimes by using wrong methods
they draw conclusions. Thus the fault lies not with the science of stats but with people
who misuse it.

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4. Blind trust on figures leads to wrong conclusion and creates distrust. It is the check
validity of figures and confirm that they are unbiased data. It is essential to check the
suitability of data to the problem and situation under study.

5. Investigators who are interested in obtaining predetermined results are provoked to

mould the data accordingly with bias and false data and get desired results.

6. Statistical methods are only tools to guide the investigators. he cannot consider the results
of statistics as final judgement . To draw conclusion on the basis of results from statistical
methods one should use his experience and skill knowledge, common sense and
professional integrity.

7. Deliberately changing the facts and information to draw their own suitable conclusion
because is very easy to alter the figures or insert new data in statistical methods.

8. Wrong and sufficient definition to the key terms which focus on core features of the
data.

9. Wrong selection of sample, methods, principles and operating with incomplete data.

10. Wrong misleading, comparison and interpretation of data.

11. Lack of technical knowledge of statistics

12. Biased opinion of the investigators

13. Not keeping limitation in mind while analyzing and interpreting any problem.

The statistical tools are useful if they are handled properly. The
person who use and handle statistics should be expert and should use statistical methods with
definite purpose. The correct use of statistics leads to correct conclusion. Wrong use of
statistics lead to wrong conclusion. Thus a good statistician requires good judgement ,broad
knowledge , experience and common sense.

For example: medicines are used for curing people, if it is used for qualified doctors it can be
useful. on the other hand, if it is used by an unqualified doctor it can be harmful.

Thus the utility or disutility of stats depends upon the man who use it , as we cannot
blame the medicine, in the same way we cannot flame them

Example: knife can be used for cutting fruits and finger of a child. It is not the knife to be
blamed but the person who kept the knife at a place within the reach of child. Thus it is not
the stats to be blamed but it is the people tro be blamed who use stats in a wrong manner.

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 Statistics neither prove nor disapprove anything. it is only a tool (i.e) a method
of approach. Tools do wonders if properly use and prove disastrous if mishandled. The same
applies to the statistical tools , if tools are misused they can do more than harm than good. So
the fault does not lie with the science of statistics . Following points must be kept in view of
the argument based on statistics are of any value.

1. issue of information.

2. Reliability of information.

3. their true sense and significance.

4. Utility of data in relation to problem in hand.

5. Manner of summarization.

6. Amount of data in relation to problem in hand.

If the data is collected in a proper way and it is uniform , complete , stable,

representative , free from personal bias then it will give correct picture of the
phenomenon.

Short question

Important Questions
1. Define statistics and give the characteristics features of statistics?

2. Enumerate the utility of statistics to business?

3. What are the important functions of statistics?

4. Short note on limitation of statistics?

5. Functions of statistician?

6. Important limitation of statistics

7. Importance of statistics in industry and commerce?

Long answer question

1. Discuss the nature scope and limitation of statistics?

2. Define statistics give the uses and limitation of its study?

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 3. Explain the meaning of statistics in both singular and plural sense. What are the
function of statistics?

4. Lies damn lies and statistics-discuss

5. Statistics may be defined as the science of collection , presentation, analysis and

interpretation of numerical data. Comment

6. Briefly discuss the subject matter of statistics

7. Discuss the important causes of distrust and how statistics could be made reliable.

8. Write a note on the importance of statistics to a businessman, an economist , a social

worker and the govt.

UNIT-II

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BUSINESS STATISTICS-I QUESTION BANK (THEORY) B.COM II YEAR
GENERAL/COMPUTERS - SEMESTER III
UNIT- I INTRODUCTION TO STATISTICS

Short Questions

1. Definition of Statistics

2. Origin and Growth/Development of Statistics

3. Nature of Statistics

4. Scope of Statistics

5. Limitations of Statistics

6. Functions of Statistics

7. Enumerate the utility of statistics to Business

8. Distrust of Statistics

Essay Questions

1. Define Statistics. Explain the Features/Characteristics/Essentials/Elements of statistics in Plural

Sense or Numerical data (Or) “All statistics are numerical statement of facts but all numerical
statement of facts are not statistics”

2. Explain 2. Define Statistics. Explain the Features/ Characteristics/Essentials/Elements of statistics in

Singular Sense or Statistical Methods. (Or) “Statistics may be defined as the Science of collection,
presentation, analysis and interpretation of numerical data”. Comment

3. 3. Explain the Scope and Nature of Statistics

4. 4. Explain the Importance/Uses/Advantages of Statistics

5. 5. Explain the Functions of Statistics

6. 6. Explain the Limitations/Disadvantages of Statistics

7. 7. Discuss the Causes/Reasons for Distrust of Statistics and how Statistics could be made reliable?
(Or) “There are three types of lies-lies, damned lies and statistics wicked in the order of their
naming”. Comment (Or) “Statistics neither proves nor disproves anything”. Discuss

UNIT- II COLLECTION & PRESENTATION OF DATA

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Short Questions

1. Differences between Primary Data and Secondary Data

2. Merits and Demerits of Primary Data

3. Merits and Demerits of Secondary Data

4. Differences between Questionnaire & Schedule

5. Census Method and Sample Method

6. Meaning of Frequency Distribution

7. Features and Objects of Classification of Data

8. Merits of Classification of Data

9. Types of Classification

10. Objects of Tabulation of Data

11. Essentials of a Good Table

12. Parts of a Table

13. Format of Table

14. Types of Tables

15. Limitations of Tabulation

16. Differences between Classification and Tabulation

17. Rules or Directions or Essentials or Features or Characteristics of a Good Diagram:

18. Importance or Utility of Diagrams

19. Types of Diagrams

20. Limitations of Diagrams

21. Uses/Merits/Importance of Graphs

22. Types of Graphs

23. Limitations of Graphs

24. Similarities and Differences between Diagrams and Graphs

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25. False Base Line

Essay Questions

1. What is Primary Data? Explain the Methods of Collecting Primary Data

2. What is a Questionnaire? Explain the precautions to be taken while drafting aQuestionnaire (Or)
Explain the Features or Essentials or Characteristics of a Good Questionnaire

3. What is Secondary Data? Explain the Sources of Secondary Data

4. What is Classification of Data? Explain the Importance or Merits or Essentials of Classification of

Data

5. Explain the Objects and Types of Classification of Data

6. What is Tabulation of Data? Explain the Features or Essentials or Characteristics or Rules of a

Good Table

7. Explain the Objects of Tabulation and Types of Tables

8. Explain the Parts and Format of a Table

9. What is Statistical Investigation? Explain the Types and Stages of Statistical Investigation

10. Explain the different types of Diagrams and Graphs

UNIT- III MEASURES OF CENTRAL TENDENCY-I

Short Questions 1. Objectives/ Uses/Functions of Average

2. Essentials of Good Average Geometric Mean

3. Merits and Demerits of Arithmetic Mean, Harmonic Mean & Geometric Mean

4. Properties of Arithmetic Mean

5. Meaning of Weighted Arithmetic Mean

6. Meaning of Combined Mean

UNIT- IV MEASURES OF CENTRAL TENDENCY-II

Short Questions 1. Meaning and Merits and Demerits of Median & Mode

2. Meaning of Quartiles, Deciles &Percentiles

3. Uses/Application of Various Averages

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4. Limitations of Averages

UNIT- V MEASURES OF DISPERSION

Short Questions

1. Features/ Requisites of Measures of Dispersion

2. Objectives of Measures of Dispersion

3. Methods of Measuring Dispersion

4. Meaning of Coefficient of Variation

5. Meaning of Variance

6. Meaning of Range

7. Meaning of Mean Deviation, Quartile Deviation & Standard Deviation

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