Business Statistics & Analytics
for
MBA Students
By
Ashutosh Sharma
(I.T.S Mohan Nagar, Ghaziabad)
Asst. Prof. Ashutosh Sharma
Content...
What is Statistics?
Applications in Business and Economics
Data
Data Sources
Descriptive Statistics
Statistical Inference
Computers and Statistical Analysis
Asst. Prof. Ashutosh Sharma
Meaning & Definition of Statistics
‘Statistics’ means numerical information expressed in
quantitative terms. This information may relate to objects,
subjects, activities, phenomena, or regions of space.
The word ‘statistics’ is used in two senses plural and singular.
In the plural sense, it refers to information in terms of numbers or
numerical data. In the singular sense, statistics refers to the whole
body of tools that are used to collect data, organise and interpret
them and, finally, to draw conclusions from them.
Statistics, therefore is defined as the science of collection,
compilation, tabulation, analysis and interpretation of
quantitative data.
Asst. Prof. Ashutosh Sharma
Application Areas of Statistics
Accounting Management
– Auditing – Describe employees
– Costing – Quality improvement
Finance Marketing
– Financial trends – Consumer preferences
– Forecasting – Marketing mix effects
Asst. Prof. Ashutosh Sharma
Data and Data Sets
Data are the facts and figures collected,
summarized, analyzed, and interpreted.
The data collected in a particular study
are referred to as the data set.
Asst. Prof. Ashutosh Sharma
Elements, Variables, and Observations
The elements are the entities on which data are
collected.
A variable is a characteristic of interest for the elements.
The set of measurements collected for a particular
element is called an observation.
The total number of data values in a data set is the
number of elements multiplied by the number of
variables.
Asst. Prof. Ashutosh Sharma
Data, Data Sets,
Elements, Variables, and Observations
Variables
Element
Names
Stock Annual Earn/
Exchange Sales($M) Share($)
C
o
Dataram AMEX 73.10 0.86
m
EnergySouth OTC 74.00 1.67
p
Keystone
a NYSE 365.70 0.86
LandCare
n NYSE 111.40 0.33
y
Psychemedics AMEX 17.60 0.13
Data Set
Asst. Prof. Ashutosh Sharma
Scales of Measurement
Scales of measurement include:
Nominal Interval
Ordinal Ratio
The scale determines the amount of information
contained in the data.
The scale indicates the data summarization and
statistical analyses that are most appropriate.
Asst. Prof. Ashutosh Sharma
Scales of Measurement
• Nominal Data
Data are labels or names used to identify an
attribute of the element.
A nonnumeric label or numeric code may be used.
Example:-
Students of a university are classified by the school in which
they are enrolled using a nonnumeric label such as Business,
Humanities, Education, and so on.
Alternatively, a numeric code could be used for the school
variable (e.g. 1 denotes Business, 2 denotes Humanities, 3
denotes Education, and so on).
Asst. Prof. Ashutosh Sharma
• Ordinal
The data have the properties of nominal data and the
order or rank of the data is meaningful.
A nonnumeric label or numeric code may be used.
Example:
Students of a university are classified by their class
standing using a nonnumeric label such as Freshman,
Sophomore, Junior, or Senior.
Alternatively, a numeric code could be used for the class
standing variable (e.g. 1 denotes Freshman, 2 denotes
Sophomore, and so on).
Asst. Prof. Ashutosh Sharma
Interval Data
The data have the properties of ordinal data, and the
interval between observations is expressed in terms
of a fixed unit of measure.
Interval data are always numeric.
Example:
Mohan has an SAT score of 1205, while Ram has an
SAT score of 1090. Mohan scored 115 points more than
Ram.
Asst. Prof. Ashutosh Sharma
Ratio Data
The data have all the properties of interval data and
the ratio of two values is meaningful.
Variables such as distance, height, weight, and time use the
ratio scale.
This scale must contain a zero value that indicates that
nothing exists for the variable at the zero point. That zero
point is called as the point of origin.
Example:
Mohan’s college record shows 36 credit hours earned,
while Ram’s record shows 72 credit hours earned. Ram
has twice as many credit hours earned by Mohan.
Asst. Prof. Ashutosh Sharma
Types of Data
Data
Numerical Categorical
(Quantitative) (Qualitative)
Discrete Continuous
Asst. Prof. Ashutosh Sharma
Qualitative and Quantitative Data
Data can be further classified as being
qualitative or quantitative.
The statistical analysis that is appropriate
depends on whether the data for the variable are
qualitative or quantitative.
In general, there are more alternatives for
statistical analysis when the data are quantitative.
Asst. Prof. Ashutosh Sharma
Qualitative Data
Labels or names used to identify an attribute of each
Element.
Often referred to as categorical data
Use either the nominal or ordinal scale of
measurement
Can be either numeric or nonnumeric
Appropriate statistical analyses are rather limited
Asst. Prof. Ashutosh Sharma
Quantitative Data
Quantitative data indicate how many or how much:
discrete, if measuring how many
continuous, if measuring how much
Quantitative data are always numeric.
Ordinary arithmetic operations are meaningful for
quantitative data.
Asst. Prof. Ashutosh Sharma
Scales of Measurement
Data
Qualitative Quantitative
Numerical Non-numerical Numerical
Ordinal Nominal Ordinal Interval Ratio
Asst. Prof. Ashutosh Sharma
Data Sources
Data
Source
s
Primar Secondar
y y
Experimen Surve Observatio Published
t y n (& On-
Line)
Asst. Prof. Ashutosh Sharma
Statistical Methods
Statistical
Methods
Descriptive Inferentia
Statistics l Statistics
Asst. Prof. Ashutosh Sharma
Descriptive Statistics
• Descriptive statistics are the tabular,
graphical, and numerical methods used to
summarize data.
Descriptive Statistics: These are statistical
methods used to describe data that have been
collected.
Asst. Prof. Ashutosh Sharma
Inferential Statistics
• Involves
– Estimation
– Hypothesis testing
• Purpose
– Make decisions about population
characteristics
Inferential Statistics: These are statistical methods used to
find out something about population based on a sample.
Asst. Prof. Ashutosh Sharma
Some Important terms to be used in Statistical Inference
Population - the set of all elements of interest in a
particular study
Sample - a subset of the population
Statistical - the process of using data obtained from a
inference sample to make estimates and test
hypotheses about the characteristics of a
population
Census - collecting data for a population
Sample survey - collecting data for a sample
Asst. Prof. Ashutosh Sharma
