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Chapter 03
Chapter 03
Chapter
Three
Chapter Three
Describing Data: Numerical Measures
GOALS
ONE
Calculate the arithmetic mean, median, mode, weighted
mean, and the geometric mean.
TWO
Explain the characteristics, uses, advantages, and
disadvantages of each measure of location.
THREE
Identify the position of the arithmetic mean, median,
and mode for both a symmetrical and a skewed
distribution.
3- 3
Chapter Three
Describing Data: Numerical Measures
FOUR
Compute and interpret the range, the mean deviation, the
variance, and the standard deviation of ungrouped data.
FIVE
Explain the characteristics, uses, advantages, and
disadvantages of each measure of dispersion.
SIX
Understand Chebyshev’s theorem and the Empirical Rule as
they relate to a set of observations.
3- 4
For ungrouped data, the
Population Mean is the
X
sum of all the population
values divided by the total
number of population N
values:
where
µ is the population mean
X is a particular value.
Population Mean
3- 5
A Parameter is a measurable characteristic of a
population.
X
56,000 ... 73,000
48,500
N 4
Example 1
3- 6
X
X
n
Sample Mean
3- 7
A sample of
five 14.0,
executives
15.0,
received the
following 17.0,
bonus last 16.0,
year ($000): 15.0
X 14 .0 ... 15 .0 77
X 15 .4
n 5 5
Example 2
3- 8
It is unique.
( X X ) (3 5) (8 5) (4 5) 0
Example 3
3- 10
(w1 X 1 w2 X 2 ... wn X n )
Xw
(w1 w2 ...wn )
Weighted Mean
3- 11
The Median
3- 13
Example 5
3- 15
Mean
Median
Mode
Mean>Median>Mode
Mode Mean
Median
Mean<Median<Mode
Mean Mode
Median
The Relative Positions of the Mean, Median, and
Mode: Left Skewed Distribution
3- 21
Geometric Mean
3- 22
GM 3 (5)(21)(4) 7.49
geometric mean is to 50
Sales in Millions($)
40
increase in sales, 30
production or other 20
10
business or economic
0
series from one time 1999 2000 2001 2002 2003 2004
835 ,000
GM 8 1 .0127
755 ,000
Example 8
3- 25
30
Dispersion 25
refers to the 20
spread or 15
variability in 10
the data. 5
0
0 2 4 6 8 10 12
range,
Measures of dispersion include the following:
mean deviation, variance, and standard
deviation.
Range = Largest value – Smallest value
Measures of Dispersion
3- 26
MD = X-X
n
Mean Deviation
3- 28
Variance: the
arithmetic mean
of the squared
deviations from
the mean.
Population Variance
3- 31
= (X - )2
N
X is the value of an observation in the population
m is the arithmetic mean of the population
N is the number of observations in the population
= (X - )2
N
= 42.227
= 6.498
Example 9 continued
3- 33
(X - X)2
s2 = n-1
s s 2
s s
2
5.30 2.30
Example 11
3- 35
1
1 2
k
where k is any constant greater than 1.
Chebyshev’s theorem
3- 36
68%
95%
99.7%
3 1 1 3