PUNJAB COLLEGE OF TECHNICAL EDUCATION, LUDHIANA

COURSE PLAN
Course: QUANTITATIVE TECHNIQUES (MB-104)
Instructor: Navin Chandra

Course Objectives: The course of ‘quantitative techniques’ is structured in such a way so that
the student pursuing MBA should have knowledge of various types of data, techniques of analysis
of data, hypothesis setting and decision making from test of hypothesis. After going through the
subject, students will be able to how to use-
a) Mathematical Tools like Annuities, Depreciation, Compound Interest techniques;
b) Statistical Tools of Averages, Dispersion, Correlation, Regression, Time Series and Index
Numbers;
c) Probability, Probability Distributions and Test of Hypothesis in the business environment.
SYLLABUS
Unit I (MATHEMATICS)
1. Role of Mathematics and statistics in Business Decisions
2. Theory of Sets
3. Compound interest, depreciation and annuities
4. Linear, Quadratic & Simultaneous Equations
5. Matrix Algebra
6. Binomial Theorem
7. Principles of Mathematical Induction
8. Arithmetic Progression & Geometric Progression

Unit II (MEASURES OF AVERAGES, DISPERSIONS & INDEX NUMBERS)

1. Measure of Central Tendency
2. Measures of Dispersion: Range, Quartile Deviation, Mean Deviation, Standard
Deviation and Coefficient of Variation, Skewness and Kurtosis
3. Index Numbers: Simple, Aggregated, Weighted and Tests of Index Numbers

Unit III (CORRELATION, REGRESSION AND TIME SERIES ANALYSIS)

1. Correlation Analysis: Rank Method & Karl Pearson's Coefficient of Correlation and
Properties of Correlation.
2. Regression Analysis: Fitting of a Regression Line, Interpretation of Results,
Properties of Regression Coefficients, Relationship between Regression and
Correlation
3. Time Series Analysis: Trend Variation, Least Square Fit, Seasonal Variation

Unit IV (PROBABILITY, HYPOTHESIS TESTING)

1. Theory of Probability, Addition and Multiplication Law, Bayes’ Theorem
2. Theoretical Distributions: Binomial, Poisson and Normal Distribution
3. Sampling Distribution, Standard Error
4. Theory of Estimation, Point Estimation, Interval Estimation
5. Testing of Hypothesis: Large Sample Tests, Small Sample test, (t, F, Z Test and Chi
Square Test).

Recommended Text Books:

 S.No Author Title Publisher
1 SANCHETI & BUSINSESS MATHEMATICS SULTAN CHAND
KAPOOR & SONS
2 S.P. GUPTA STATISTICAL METHODS SULTAN CHAND
& SONS
3 LEVIN & RUBIN STATISTICS FOR MANAGEMENT PRENTICE HALL
INDIA

Recommended Reference Books:

S.No Author Title Publisher
1 Dr. S. C. BASIC MATHEMATICS FOR MBA V K (INDIA)
AGGARWAL ENTERPRISES
2 ANDERSON, STATISTICS FOR BUSINESS AND CENGAGE
SWEENEY & ECONOMICS LEARNING
WILLIAMS
3 T. R. JAIN & Dr. S. STATISTICS FOR MBA V K (INDIA)
C. AGGARWAL ENTERPRISES

Case studies & their objectives:

Case 1: INDIAN CRICKETERS – EARNINGS CONSIDERING RUNS & WICKETS
The objective of this case study is to use statistical tools of Measures of- ‘Central Tendency’ and
‘Dispersion’ in practical situation.

Case 2: RELIANCE INDUSTRIES LTD- BETA COEFFICIENT

The objective of this case study is to find out BETA co-efficient of a Company using statistical tools
of ‘Covariance’ and ‘Variance’.

Assignments:
Assignment 1: Sums from Unit 1 of the syllabus based on actual business situation.

Assignment 2: Calculation of co-efficient of correlation between SENSEX (BSE) and NIFTY (NSE)
for-
a) Closing indices from 1st July,2010 to 15th July,2010
b) Market Capitalisation from 1st July,2010 to 15th July,2010
c) Daily rate of Return
The Objective of these assignments is that the students should adapt themselves how the
calculations and analyses are made in real life situations.

Evaluation: Students will be evaluated on the basis of following criteria

MSE’s: 15 marks
Presentation: 7 marks
TESTS (two): 10 marks (Every test will have equal weightage of 5 marks)
Assignments (two): 8 marks (Each assignment will carry 4 marks)

LECTURE SCHEDULE
Lecture Topics Assignment
Number
1 Theory of Sets
1. Definition of sets
2. Representation of sets-
a) Tabular or Roster Form
b) Set Builder Form
3. Types of sets
2 Theory of Sets
1. Types of sets (contd...)
2. Elementary operations
a) Union of two sets
b) Intersection of two sets
c) Complement of a set
d) Difference of two sets
e) Symmetric difference of two sets
3. Laws of set operations
3 Compound Interest & depreciation
a) Logarithms
b) Compound interest sums
c) Depreciation sums
4 Annuities
1. Types of annuities
2. Sums of sum due
5 Annuities
Sums of present value
6 Linear, Quadratic & Simultaneous Equations
1. Brief of equations & steps for solution
2. sums for solution of equations
7 Matrix Algebra
1. Definition & Types of Matrices
2. Operations on Matrices
8 Matrix Algebra
1. Determinant of Matrix
2. Inverse of Matrix
9 Matrix Algebra
1. Solution of simultaneous =ns by Crammer rule
2. Solution of simultaneous =ns by Matrix method
10 Binomial Theorem
1. Statement for Binomial Expansion
2. Sums of binomial expansion
11 Principles of Mathematical Induction Assignment 1- sums
1. Working Rule for proving statement from unit 1 of syllabus
2. Sums of mathematical induction
12 Arithmetic Progression & Geometric Progression
1. Rule of A.P.
2. Finding out nth term and sum of n terms
13 Arithmetic Progression & Geometric Progression
1. Rule of G.P.
2. Finding out nth term and sum of n terms
14 Measure of Central Tendency
Definition and formulae of Mean, Median & Mode
15 Measures of Dispersion
 1. Range and its co-efficient
2. Quartile Deviation and its co-efficient
16 Measures of Dispersion
1. Mean Deviation and its co-efficient
17 Measures of Dispersion
1. Standard Deviation and Coefficient of Variation
18 Case Study 1 to be discussed
19 Measures of Skewness and Kurtosis
20 Index Numbers
1. Simple aggregated index numbers
2. Simple average index numbers
3. Weighted aggregated index numbers
4. Tests of Index Numbers
21 Index Numbers
1. Weighted aggregated index numbers
2. Weighted average index numbers
3. Tests of Index Numbers
22 Correlation Analysis
1. Definition
2. Karl Pearson's Coefficient of Correlation
23 Correlation Analysis
1. Karl Pearson's Coefficient of Correlation
24 Correlation Analysis Assignment 2-
1. Spearman’s Rank correlation Calculation of co-
2. Properties of correlation efficient of correlation
between
BSE & NSE
25 Case Study 2 to be discussed
26 Regression Analysis
1. Fitting of a Regression Line
27 Regression Analysis
1. Fitting of a Regression Line
28 Regression Analysis
1. Properties of Regression Coefficients
2. Relationship between Regression and
Correlation
29 Time Series Analysis
1. Trend Variation- semi average method
2. Trend Variation- moving average method
30 Time Series Analysis
Trend Variation- Least square method
31 Time Series Analysis
Seasonal Variation- a) Method of Simple
Average; b) Method of Moving Average
c) Ratio to Moving Average
32 Time Series Analysis
Seasonal Variation- Ratio to Trend Method
33 Time Series Analysis
Seasonal Variation- Link Relatives Method
34 Theory of Probability
 1. Definition
2. Addition and Multiplication Law
3. Sums of probability
35 Theory of Probability
1. Sums of probability
36 Theory of Probability
1. Bayes’ Theorem
37 Theoretical Distributions
1. Binomial Distribution
2. Sums of Binomial Distribution
38 Theoretical Distributions
1. Poisson Distribution
2. Sums of Poisson Distribution
39 Theoretical Distributions
1. Normal Distribution
2. Sums of Normal Distribution
40 Sampling Distribution & Standard Error
41 Theory of Estimation
1. Point Estimation
2. Interval Estimation
42 Testing of Hypothesis
Large Sample Tests- Z test
43 Testing of Hypothesis
Large Sample Tests- Z test
44 Testing of Hypothesis
Small Sample Tests- t test
45 Testing of Hypothesis
Small Sample Tests- t test
46 Testing of Hypothesis
Chi Square Test
47 Testing of Hypothesis
F test & ANOVA Table
48 Testing of Hypothesis
ANOVA Table

CASE STUDY-1
INDIAN CRICKETERS – EARNINGS CONSIDERING RUNS & WICKETS
A report, published in newspaper The Times of India on 12 th November, 2006, showed the
following data of earnings, runs scored and wickets taken by some of international cricketers in the
year in one day matches in 2005-06:
S. Name of Cricketer Earnings Runs Earning per Wickets Earnings
No. (Rs. In Lac) Scored run (Rs) Taken per wicket
(Rs)
 BATSMEN
1 Rahul Dravid 138.50 2,371 5,841 0 0
2 Sachin Tendulkar 102.90 1,063 9,680 3 34,30,000
3 Virender Sehwag 133.70 1,793 7,457 19 7,03,684
4 V. V. S. Laxman 77.50 589 13,158 0 0
5 Sourav Ganguly 60.00 155 38,710 1 60,00,000
6 Yuvraj Singh 112.10 1,619 6,924 8 14,01,250
7 Mohd. Kaif 88.40 708 12,486 0 0
8 Gautam Gambhir 45.10 350 12,886 0 0
9 Suresh Raina 43.20 516 8,372 0 0
10 Wasim Jaffer 17.50 622 2,814 0 0
BOWLERS
11 Anil Kumble 82.50 355 23,239 68 1,21,324
12 Harbhajan Singh 91.88 357 25,737 66 1,39,212
13 Irfan Pathan 119.80 986 12,150 71 1,68,732
14 Ajit Agarkar 91.40 188 48,617 46 1,98,696
15 Zaheer Khan 31.40 56 56,071 13 2,41,539
16 Munaf Patel 51.00 38 1,34,211 33 1,54,545
17 Sreesanth 62.90 78 80,641 45 1,39,778
WICKETKEEPER
18 M. S. Dhoni 120.30 1,587 7,580 0 0

Mahesh wants to analyse the above data to evaluate the performance of these players. He has
thought of using the measures of location (central tendency) and measures of dispersion for this
analysis. He wants to calculate:
a) Average Earnings per run scored for the batsmen;
b) Average Earnings per wicket taken for the bowlers;
c) Appropriate measure of consistency among the batsmen with respect to earnings per run;
d) Appropriate measure of consistency among the bowlers with respect to earnings per
wicket.
You are required to help Mahesh in above analysis and evaluate their performances.

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CASE STUDY-2
RELIANCE INDUSTRIES LTD- BETA COEFFICIENT
Mr. Jagmohan, Managing Director of J.M. Securities Limited, a stock exchange brokering
company, is interested in investing huge funds in the equity shares of RELIANCE INDUSTRIES
LTD. The equity share of the above company is currently being traded at Rs. 1,208. He wants to
find out whether the share is over-valued or under-valued. For this purpose he has obtained and
analysed various relevant information like risk free rate of return, rate of return on market portfolio
and estimated cash inflows for next ten years. Now he needs to find out Beta Co-efficient of the
Company. For this purpose the following information is provided:

Date BSE Sensex Market Price of RIL

12389 1155
5.10.2006
12373 1163
6.10.2006
12366 1154
9.10.2006
10.10.200 12364 1151
6
11.10.200 12353 1143
6
12.10.200 12538 1170
6
13.10.200 12736 1190
6
16.10.200 12928 1213
6
17.10.200 12884 1216
6
18.10.200 12858 1208
6

You are required to help out Mr. Jagmohan in finding out β of Reliance Industries Limited. The
following formulae may be of your help:

current value− preceding value

1. Daily Rate of Return= *100
preceding value

covariance( X ,Y )
2. β =
Variance( X)

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