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Chapter 1
Statistics for Business and Economics, 6e © 2007 Pearson Education, Inc. Chap 1-1
Chapter Goals
After completing this chapter, you should be
able to:
Explain how decisions are often based on incomplete
information
Explain key definitions:
Population vs. Sample
Parameter vs. Statistic
Descriptive vs. Inferential Statistics
Describe random sampling
Explain the difference between Descriptive and
Inferential statistics
Statistics for Business and Economics, 6e © 2007 Pearson Education, Inc. Chap 1-2
Dealing with Uncertainty
Consider:
The price of IBM stock will be higher in six months
than it is now.
Statistics for Business and Economics, 6e © 2007 Pearson Education, Inc. Chap 1-3
Dealing with Uncertainty
(continued)
Statistics for Business and Economics, 6e © 2007 Pearson Education, Inc. Chap 1-4
Key Definitions
Statistics for Business and Economics, 6e © 2007 Pearson Education, Inc. Chap 1-5
Population vs. Sample
Population Sample
a b cd b c
ef gh i jk l m n gi n
o p q rs t u v w o r u
x y z y
Statistics for Business and Economics, 6e © 2007 Pearson Education, Inc. Chap 1-7
Random Sampling
chosen,
and
every possible sample of n objects is equally likely to
be chosen
Statistics for Business and Economics, 6e © 2007 Pearson Education, Inc. Chap 1-8
Descriptive and Inferential Statistics
Statistics for Business and Economics, 6e © 2007 Pearson Education, Inc. Chap 1-9
Descriptive Statistics
Collect data
e.g., Survey
Present data
e.g., Tables and graphs
Summarize data
X i
e.g., Sample mean = n
Statistics for Business and Economics, 6e © 2007 Pearson Education, Inc. Chap 1-10
Inferential Statistics
Estimation
e.g., Estimate the population
mean weight using the sample
mean weight
Hypothesis testing
e.g., Test the claim that the
population mean weight is 120
pounds
Knowledge
Experience, Theory,
Literature, Inferential
Statistics, Computers
Information
Descriptive Statistics,
Begin Here: Probability, Computers
Data
Identify the
Problem
Statistics for Business and Economics, 6e © 2007 Pearson Education, Inc. Chap 1-12
Chapter Summary
Statistics for Business and Economics, 6e © 2007 Pearson Education, Inc. Chap 1-13