STATISTICS – AN

INTRODUCTION
 DEFINITION
• The science of statistics is the method of judging
collective, natural or social phenomenon from the
results obtained from the analysis of enumeration
or collection of estimates
• Classified facts representing the conditions of the
people of State – especially those facts which can
be stated in numbers, or in an other tabular or
classified arrangement
• Statistics is the science of estimates and
probabilities
MEANING
• Statistics is the theory and method of
analyzing groups of measurements when the
experimenters and navigators have
completed their projects
• The methods by which statistical data are
analyzed are called statistical methods and
statistical methods are the devices for
achieving the desired ends explained in the
theory.
• Mathematical theory which is the basis of the
analysis, is mathematical statistics.
APPLICATIONS
• Helps in presenting an unwieldy mass of
matter in a simple, definite and classified
form
• It is a body of methods for making wise
decisions in the face of uncertainty
• Applicable in Economics, Business
Management, Engineering, Sociology,
Agriculture & Research, etc.
THE NATURE OF A STATISTICAL
STUDY
 Formulation of the Problem  
 Objectives of the Study  
 Determining Sources of Data  
 Designing Data Collection Forms  
 Conducting the Field Survey  
 Organizing the Data  
 Analyzing the Data  
 Reaching Statistical Findings  
 Presentation of Findings  

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IMPORTANCE OF STATISTICS IN
BUSINESS
 Statistical Quality Control Methods
 Personnel Management
 Seasonal Behavior
 Export Marketing
 Maintenance of Cost Records
 Management of Inventory
 Expenditure on Advertising and Sales
 Mutual Funds
 Relevance in Banking and Insurance Institutions

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LIMITATIONS OF STATISTICS

1. There are certain phenomena or concepts where

Statistics cannot be used. This is because these
phenomena or concepts are not amenable to
measurement.
2. Statistics reveal the average behavior, the normal or
the general trend.
3. Since Statistics are collected for a particular purpose
4. Statistics is not 100 per cent precise as is Mathematics
or Accountancy.

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LIMITATIONS OF STATISTICS

5. In Statistical surveys, sampling is generally used as

it is not physically possible to cover all the units or
elements comprising the universe.
6. At times, association or relationship between two
or more variables is studied in Statistics, but such
a relationship does not indicate ‘cause and effect’
relationship.
7. A major limitation of Statistics is that it does not
reveal all pertaining to a certain phenomenon.
There is some background information that
Statistics does not cover.
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MISUSES OF STATISTICS

• Sources of Data not Given  

• Defective Data  
• Unrepresentative Sample  
• Inadequate Sample  
• Unfair Comparisons  
• Unwarranted Conclusions  

• Confusion of Correlation and Causation  

• Suppression of Unfavorable Results  

• Mistakes in Arithmetic   9
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