Initial

Printline
 Chapter heads

Page

CHAPTER 1 : PERCENTAGE, PROFIT AND LOSS, RATIO AND 1

PROPORTION
CHAPTER 2 : Sampling and Sampling Distributions 20
CHAPTER 3 : Formation of Frequency Distribution 41
and Their Graphical Representation
CHAPTER 4 : Measures of Central Tendency 62
CHAPTER 5 : Measures of Variation 113
CHAPTER 6 : Measurement of Scale 198
CHAPTER 7 : Set Theory 206
CHAPTER 8 : Relations and Functions 220
CHAPTER 9 : Theory of Probability 238
CHAPTER 10 : Permutation And Combinations 270
CHAPTER 11 : Progressions and Series 292
CHAPTER 12 : Index Numbers 311
CHAPTER 13 : Mathematics of Finance 329

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Blank
 Contents
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CHAPTER 1
PERCENTAGE, PROFIT AND LOSS,
RATIO AND PROPORTION
1.1 Introduction 1
1.2 Percentage 1
1.3 Profit and Loss 4
Objective Type Questions 7
Fill in the Blanks 10
True/False 12
Answers to Objective Type Questions 13
Answers to Fill in the Blanks 18
Answers to True/False 19

CHAPTER 2
Sampling and Sampling Distributions
2.1 Introduction 20
2.2 Descriptive and Inferential Statistics 20
2.3 Population and Sample 21
2.4 Census versus Sample Method 22
2.5 Statistics and Parameters 22
2.6 Sampling Methods 24
2.7 Simple Random Sampling 25

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 Contents I-6

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2.8 Systematic Sampling 27

2.9 Stratified random sampling 28
2.10 Cluster Sampling 29
2.11 Multi-stage sampling 29
2.12 Judgment Sampling 30
2.13 Convenience Sampling 31
2.14 Quota Sampling 31
2.15 Bias and Error in Sampling 32
Objective Type Questions 34
Fill in the Blanks 37
True/False 38
Answers to Objective Type Questions 39
Answers to Fill in the Blanks 40
Answers to True/False 40

CHAPTER 3
Formation of Frequency Distribution
and Their Graphical Representation
3.1 Introduction 41
3.2 Frequency Distribution 41
3.3 Tabulation of Data 45
3.4 Graphical Representation of a Frequency Distribution 46
Objective Type Questions 55
Fill in the Blanks 57
True/False 59
Answers to Objective Type Questions 59
Answers to Fill in the Blanks 60
Answers to True/False 61

CHAPTER 4
Measures of Central Tendency
4.1 Introduction 62
4.2 Definition of Average 62
I-7 Contents

Page

4.3 Properties of a Good Average 63

4.4 Various Measures of Central Tendency 63
Objective Type Questions 95
Fill in the Blanks 101
True/False 102
Answers to Objective Type Questions 103
Answers to Fill in the Blanks 111
Answers to True/False 112

CHAPTER 5
Measures of Variation
5.1 Introduction 113
5.2 Meaning of Variation or Dispersion 113
5.3 Characteristics of a Good Measure of Variation 114
5.5 Quartiles, Deciles and Percentiles 115
5.5 Measures of Variation 122
5.6 Coefficient of Variation 144
5.7 Meaning of Skewness 153
5.8 Types of Skewness 154
5.10 Measures of Skewness 155
5.11 Karl Pearson’s Coefficient of Skewness 156
5.12 Bowley’s Coefficient of Skewness 167
5.13 Kurtosis 172
Objective Type Questions 173
Fill in the Blanks 182
True/False 184
Answers to Objective Type Questions 185
Answers to Fill in the Blanks 195
Answers to True/False 196

CHAPTER 6
Measurement of Scale
6.1 Introduction 198
 Contents I-8

Page

6.3 Different Scales of Measurements 198

Objective Type Questions 201
Answers to Objective Type Questions 204

CHAPTER 7
Set Theory
7.1 Introduction 206
7.2 Meaning of a set 206
7.3 Representation of Sets: 207
7.4 Types of Sets: 207
7.6 Applications of Set Theory: 212
7.7 Cartesian product of sets 212
Objective Type Questions 215
Fill in the Blanks 217
True/False 217
Answers to Objective Type Questions 218
Answers to Fill in the Blanks 219
Answers to True/False 219

CHAPTER 8
Relations and Functions
8.1 Introduction 220
8.2 Relation 221
8.3 Types of Relations: 221
8.4 Functions 222
8.5 Algebra of Functions 222
8.6 Types of Functions 223
8.7 Functions Related to Business and Economics 225
Objective Type Questions 230
Fill in the Blanks 232
Answers to Objective Type Questions 233
Answers to Fill in the Blanks 237
I-9 Contents

Page

CHAPTER 9
Theory of Probability
9.1 Introduction 238
9.2 Meaning of Probability 239
9.3 Basic Terminology 239
9.4 Different Approaches to Probability 240
9.5 Addition Theorem of Probability 241
9.6 Multiplication Theorem of Probability 242
9.7 Conditional Probability 243
9.8 Bayes’ Theorem 243
Objective Type Questions 253
Fill in the Blanks 258
True/False 260
Answers to Objective Type Questions 261
Answers to Fill in the Blanks 267
Answers to True/False 269

CHAPTER 10
Permutation And Combinations
10.1 Introduction 270
10.2 Factorial 270
10.3 Fundamental Principle of Multiplication: 271
10.4 Fundamental Principle of Addition: 271
10.5 Permutations 272
10.6 Permutations Under Different Conditions 273
10.7 Combinations 275
Objective Type Questions 277
Fill in the Blanks 281
True/False 283
Answers to Objective Type Questions 284
Answers to Fill in the Blanks 289
Answers to True/False 290
 Contents I-10

Page

CHAPTER 11
Progressions and Series
11.1 Introduction 292
11.2 Sequence and Series 292
11.3 Progressions 292
11.4 Arithmetic Progression (A.P) 293
11.5 Geometric Progression 301
11.6 Harmonic Progression 308

CHAPTER 12
Index Numbers
12.1 Introduction 311
12.3 Uses of Index numbers 311
12.4 Methods of constructing index numbers 312
12.5 Weighted Aggregative Index 317
12.6 Value Index 324

CHAPTER 13
Mathematics of Finance
13.1 Introduction 329
13.2 Basic Terminology of Finance 329
13.3 Simple Interest 330
13.4 Compound Interest 334
13.5 Interest Compounded Continuously 338
13.6 Compound Amount At Changing Rates 340
13.7 Present Value or Capital Value 345
13.8 Annuity 347
13.9 Amount or Future Value of an Ordinary Annuity 348
13.9 Present Value of an Ordinary Annuity 353
13.15 Amortization of Loans 362
 C H A P T E R

1 PERCENTAGE, PROFIT AND LOSS,

RATIO AND PROPORTION

Learning Objectives
By the end of this chapter, you will be able to understand:
u Meaning of percentage.
u Application of percentage in daily life through word problems.
u Concept of Profit and Loss
u Meaning of Ratio and proportion.
u Types of ratios

1.1 Introduction
In this chapter, we first introduce the concept of percentage and discuss its
use in daily life. In the next section we discuss ratio and proportion
1.2 Percentage
The word percent means per hundred. We denote it by symbol %. Out of 100
equal part, each part is known as its hundredth part. By a certain percentage,
we mean “that many” hundredths. For instance, 5% means 5 hundredths. In
order to convert a fraction into a percentage, multiply the fraction by 100 and
3
put the % sign. For example, ¾ is equal to × 100 = 75% . Conversely, in order
4
to convert a percentage into a fraction, we divide it by 100 and remove the
75 3
sign of %. For example, 75% is equal to fraction  .
100 4
Example 1 : Convert each of the following into a percentage.
6
(a)  (b) 14:25  (c) 0.008
5
1
Para 1.2 Percentage, Profit and loss, ratio 2

Solution 1:
6 6
(a) = × 100 = 120%
5 5
14
(b) 14 : 25 = × 100 = 56%
25
(c) 0.008  0.008 100  0.8%

Example 2: Evaluate 0.25% of 16

0.25
Solution : 0.25% of 16 = × 16 = 0.04
100
Example 3: What percent of 3.5 Kg is 700 grams?
Solution : 3.5 kgs = 3500 grams. Let x% of 3.5 Kg is 700 grams.
x
Then  3500  700  x = 20
100
Therefore, 20% of: 3.5 kg is 700 grams.
1
Example 4 : Find the number whose 6 % is 2 .
4
25 1
Solution : Let the number be x. Then × × x =2 ⇒ x =32
4 100
Example 5 : What amount is 10% more than ` 90?
10
Solution: 10% of 90 = × 90 = 9
100
Then amount = 9 + 90 = ` 99

Example 6: What amount is 20% less than ` 60?

20
Solution: 20% of 60 = × 60 = 12
100
Then amount = 60 – 12 = ` 48

Example 7 : An alloy contains 32% zinc, 40% copper and the rest nickel. Find in
grams the quantity of each of the contents in 1 kg of alloy.
32
Solution : Quantity of zinc in 1000 grams of alloy = 32% of 1000 = × 1000 = 320g
100
40
Quantity of copper in 1000 grams of alloy = 40% of 1000 = × 1000 = 400g
100
Quantity of nickel in 1000 grams of alloy = 1000 – 320 – 400 = 280 g

Example 8 : A basket contains 350 oranges. If 12% of these oranges are rotten, find
how many oranges were rotten and how many are good enough to be sold ?
3 Percentage Para 1.2

12
Solution : Number of rotten oranges = × 350 = 42
100
Number of good oranges = 350 – 42 = 308

Example 9 : In an examination, 96% of the candidates passed and 50 failed. How

many candidates appeared?
Solution : Let the number of candidates appeared be x.
If 96% candidates passed then 4% candidates failed.

Then 4
× x = 50 ⇒ x = 1250
100
Thus, the number of candidates that appeared = 1250

Example 10 : A number is increased by 10% and then the increased number is

decreased by 10%. Find the net increase or decrease per cent.
Solution : Let the number be x.
10 110x 11x
New number after 10% increment = x + ×x = =
100 100 10
When the new number is decreased by 10% then the decreased number is
11x 10 11x 99x
− × =
10 100 10 100
99x x
Net decrease = x − = = 1% of x
100 100
Therefore, net decrease is 1%

Example 11 : The salary of a person is increased by 25%. By what percent should

the new salary be reduced to restore the original salary?
Solution: Let the salary be ` x.
25x 125x
Then after 25% increment, new salary = x + =
100 100
Let this new salary be reduced by y% to restore original salary.
According to question,
125x y 125x
− × =x
100 100 100
125x  y 
⇒ 1− =x
100  100 


 y  20%

Therefore, salary should be reduced by 20% to restore original salary.

Para 1.3 Percentage, Profit and loss, ratio 4

1.3 PROFIT AND LOSS

In order to understand the concept of profit and loss, we must know the
meaning of following terms.
Cost price: The price at which an article is purchased is called its cost price
(C.P). Cost per item, sales tax, excise tax, labour charges, cartage, rent etc., all
are included in the cost price.
Selling Price: The price at which an article is sold is called its selling price,
written as S.P.
Profit or Gain: If S.P. > C.P then the seller has a profit or gain. Gain = S.P –
C.P . We must note that gain is always reckoned on C.P. Gain on ` 100 is called
gain percent or profit percent.
gain
gain% = × 100
C.P
(100 + gain%)
sP = × C.P
100
100
CP = × s.P
(100 + gain%)
Loss: If C.P. > S.P then the seller has a loss. Loss = C.P – S.P . We must note
that loss is always reckoned on C.P. Loss on ` 100 is called loss percent.
Loss
Loss% = × 100
C.P
(100 − Loss%)
sP = × C.P
100
100
CP = × s.P
(100 − Loss%)
Example 12 : A toy was purchased for ` 1120 and was sold for ` 1260. Find the
gain or loss percent?
Solution : We are given that S.P = 1260, C.P = 1120. Since, S.P > C.P therefore,
it is a case of profit.
gain = s.P − C.P = 1260 − 1120 = 140
gain 140
gain% = × 100 = × 100 = 12.5%
C.P 1120

Example 13: If the cost price of 6 pencils is equal to the selling price of 5 pencils,
find the gain percent.
Solution : Let the cost price of each pencil be ` 1. Then CP of 5 pencils = ` 5.
S.P of 5 pencils = C.P of 6 pencils = `6
5 Profit and loss Para 1.3

⇒ gain = s.P − C.P = 6 − 5 = 1

gain 1
⇒ gain% = × 100 = × 100 = 20%
C.P 5
Example 14 : Find the selling price of an article bought for ` 650 when gain% = 6%
(100  gain%)
Solution : sP 
100  6
 C.P   650  689
100 100
Thus, selling price = ` 689

Example 15 : Find the selling price of an article bought for ` 3300 when loss% = 10%

Solution : sP =
(100 − Loss%) (100 − 10)
× C.P = × 3300 = 2970
100 100
Thus, selling price = ` 2970

Example : By selling an article for ` 1440, a trader gains 20%. Find the C.P of the chair.
Solution : S.P = ` 1440, gain% = 20%
100 100
CP   s.P  1440  1200
(100  gain%) (100  20)

Example : By selling an almirah for ` 9240, a seller loses 12%. For how much
should he sell it to gain 12%?
Solution : S.P = ` 9240, Loss% = 12%
100 100
Therefore, CP   s.P   9240  10500
(100  Loss%) (100  12)
Now, C.P = ` 10500, gain% required = 12%
(100  gain%) (100  12)
Therefore, sP   C.P  10500  11760
100 100
Therefore, the required selling price = ` 11760

RATIO
The ratio of two quantities “a” and “b” in the same units is the fraction a/b. We
write it as a:b. In the ratio a:b, we call “a” as antecedent and “b” as consequent.
Note that the multiplication or division of each term of a ratio by the same
non zero number does not effect the ratio.

PROPORTION
The equality of two ratios is called proportion. If two ratios a:b and c:d are
equal then we say that a, b, c, d are in proportion and we write a:b::c:d. Here,
a and b are called extremes while b and c are mean terms.
Para 1.3 Percentage, Profit and loss, ratio 6

Product of means = product of extremes

Thus, a : b :: c : d ⇔ ad = bc
Fourth Proportional: If a : b :: c : d then d is called fourth proportional to a,b,c
Third Proportional: If a : b :: b : c then c is called third proportional to a and b
Mean Proportional between a and b is ab
Continued Proportion: If a:b=b:c then a,b,c are in continued proportion, then
b is called the mean proportional between a and c and c is called the third
proportional to a and b.
Comparison of ratios: If a : b and c : d are two ratios such that (a : b) > (c : d)
a c a c
Then > . Converse is also true. (a : b) > (c : d) ⇔ >
b d b d
Continued Ratio : Continued Ratio is the comparison between the magnitudes
of three or more quantities of the same kind, having the same units. The
continued ratio of three similar quantities a, b, c is a : b : c.
Commensurable quantities : If the ratio of two similar quantities can be expressed
as a ratio of two integers, the quantities are said to be commensurable. e.g. 3:4
Incommensurable quantities : If the ratio of two similar quantities cannot be
expressed as a ratio of two integers, the quantities are said to be incommensurable.
e.g. 3 : 5

TYPES OF RATIOS

1. Duplicate ratio: Duplicate ratio of (a : b) is (a 2 : b2 )

2. Compound ratio: If (a : b),(c : d),(e : f) are any three ratios then compou-
product of antecedents
nded ratio is (ace : bdf) , i.e., compounded ratio =
product of consequent
3. Sub-duplicate ratio: Sub- duplicate ratio of (a : b) is ( a : b)
4. Triplicate ratio: Triplicate ratio of (a : b) is (a 3 : b3 )
5. Sub-triplicate ratio: Sub triplicate ratio of (a : b) is (a1/3 : b1/3 )
6. If a:b = c:d = e:f Then, a:b = c:d = e:f = (a+ c + e …sum of antecedents)
: (b + d + f …sum of consequents)

Illustrations Based on Types of Quantities:

I-1.There is no ratio between the age of a person and weight of another person.
I-2.There is no ratio between the income of a person and his height.
7 Objective type questions

Illustrations Based on Units:

I-3.The ratio of two distances 2m and 3km is not 2:3
The actual ratio is obtained by expressing both quantities in the same units i.e.
the ratio of 2m and 3km is 2m : 3km = 2m : 3000m = 1 : 1500.
I-4.The ratio of 500g to 5 kg is not 100 :1
The actual ratio is 500g : 5kg=500g : 5000g=1:10.

Example : The ratio of two quantities is 3:7. If the antecedent is12, then find the
consequent.
3 12
Solution : Let the consequent be x, then ∴ = ⇒ x =28
7 x
Example: Find the inverse ratio of 21:17
Solution: Inverse ratio is 17: 21

OBJECTIVE TYPE QUESTIONS

Q1. The ratio 2:5 as rate percent is :
(a) 0.4% (b) 14% (c) 0.4% (d) 40%
Q2. What percent of 2/7 is 1/35?
(b) 20% (b) 25% (c) 15% (d) 10%
Q3. A number increased by 20% gives 42. The number is:
(a) 28 (b) 36 (c) 30 (d) 35
Q4. A number decreased by 8% gives 69. The number is:
(a) 80 (b) 75 (c) 85 (d) 35
Q5. An ore contains 5% zinc. How much ore is required to obtain 400 grams of
zinc?
(a) 8kg (b) 2kg (c) 5kg (d) none
Q6. What is the marked price of a television set if after discount of 10% , it costs
`18000?
(a) `20000 (b) `18000 (c) `18800 (d) none
Q7. Find the original salary of a man if after increment by 25%, his salary becomes
`20000?
(a) `15000 (b) `16000 (c) `18000 (d) none
Q8. A fruit seller had some oranges. He sells 40% of them and still has 420 oranges.
How many oranges had he in all?
(a) 600 (b) 700 (c) 800 (d) none
 Percentage, Profit and loss, ratio 8

Q9. The value of a machine depreciates 10% annually. If its present value is `25000,
what will be its value after 1 year?
(a) ` 27500 (b) ` 22500 (c) ` 30000 (d) none
Q10. If 11% of a number exceeds 7% of the number by 18, then the number is:
(a) 72 (b) 360 (c) 450 (d) none
Q11. If 35% of a number added to 39 is the number itself, the number is:
(a) 60 (b) 50 (c) 75 (d) none
Q12. If 15% of the workers in a factory are females and the number of male workers
is 272. Find the total number of workers in the factory.
(a) 300 (b) 320 (c) 400 (d) none
Q13. Find the percentage of pure gold in 22 carat gold if 24 carat gold is 100% pure
gold.

(a)
2 2
91 % (b) 90 % (c) 90% (d) 91%
3 3
Q14. In the new budget, the price of diesel has increased by 205. By how much percent
must a motorist reduce his consumption of diesel so that his expenditure on
it does not increase?

(a) 16 2 % (b) 16% (c) 20% (d) none

3
Q15. If the cost price of 15 pens is equal to the S.P of 20 pens, then the loss percent is :
(a) 20% (b) 25% (c) 30% (d) none

Q16. A toy was purchased for ` 400 and was sold for ` 336. Find the loss percent?
(a) 16% (b) 20% (c) 22% (d) none
Q17. An electrician sells a room heater for ` 3220, gaining 1/6 of its cost price. Find
his gain percent.

(a) 2
16 % (b) 20% (c) 22% (d) none
3
Q18. An article was purchased for `14360 and `240 was spent on its transportation.
At what price should it be sold to gain 15%?
(a) `16000 (b) `16790 (c) 15000 (d) none

Q19. A man sold two radios at `4800 each. On one, he gains 20% and on the other
he loses 20%. Find the gain or loss percent in the whole transaction.
(a) 4% loss (b) 4% gain (c) 3% loss (d) 3% gain
Q20. If the manufacturer gains 6%, the wholesaler gains 8%, the retailer gains 10%,
then what is the production cost of an almirah whose retail price is ` 5741?
(a) 12500 (b) 13000 (c) 14500 (d) none
9 Objective type questions

Q21. An article when sold at a profit of 6% yields ` 870 more than when it is sold at
a loss of 6%. Find the cost price of the article.
(a) 7250 (b) 8000 (c) 6500 (d) none
Q22. A man bought a book for ` 80 and sells it for ` 100. Then gain % is :
(a) 20% (b) 25% (c) 120% (d) none
Q23. A pen drive is purchased for `120 and sold for `105. Then loss% is :
(a) 12.5% (b) 20% (c) 13% (d) none
Q24. On selling a pencil set for `48, a dealer loses 20%. In order to gain 20%, what
would be the selling price?
(a) ` 52 (b) ` 56 (c) ` 68 (d) ` 72
Q25. On selling a stool for ` 630, a man loses 10%. The C.P of the stool is :
(a) ` 567 (b) ` 693 (c) `7 00 (d) none
Q26. On selling a stool for ` 720, a man gains 20%. The C.P of the stool is :
(a) ` 567 (b) ` 693 (c) ` 600 (d) none
Q27. On selling an article for ` 144, a man loses 10%. At what price should he sell it
to gain 10%:
(a) ` 156 (b) ` 693 (c) ` 176 (d) none
Q28. If 5:8 : : 0.75 : x then the value of x is :
(a) 12 (b) 1.2 (c) 2.1 (d) none

Q29. The mean proportional of 0.32 and 0.02 is :

(a) 0.08 (b) 0.00125 (c) 0.8 (d) none

Q30. The third proportional of 0.32 and 0.02 is :

(a) 0.08 (b) 0.00125 (c) 0.8 (d) none

Q31. Forth proportional to 16, 4 , 4 is :

(a) 2 (b) 1 (c) 2.1 (d) none
Q32. What point of 3/48 is 1/12?
(a) ¾ (b) 4/3 (c) ¼ (d) none
Q33. The ratio of number of girls and boys in a class is 4:3. There are 480 girls in
the class. Then the number of boys are:
(a) 300 (b) 350 (c) 360 (d) none
Q34. If a : b = 2 : 3; b : c = 4 : 5,c : d = 3 : 7. then a : b : c : d is
(a) 8:12:15:35 (b) 8:15:12:35 (c) 12:8:15:35 (d) none
Q35. If a:b= 3:4 and b:c = 8: 9 then a:c is
(a) 3:2 (b) 2:3 (c) 1:2 (d) none
 Percentage, Profit and loss, ratio 10

a b c
Q36. If = = then a:b:c is:
3 4 5
(a) 4:5:3 (b) 3:4:5 (c) 3:5:4 (d) none
a b c
Q37. If = = then find a + b + c
3 4 5 c
(a) 12/5 (b) 5/12 (c) 1/12 (d) none
Q38. If x 2 + 4y 2 = 4xy then x:y is
(a) 1:2 (b) 2:1 (c) 1:3 (d) 3:1
Q39. The duplicate ratio of 4 : 9 is :
(a) 2 : 3 (b) 4 : 3 (c) 16:81 (d) 81:16
Q40 The triplicate ratio of 4:3 is:
(a) 64:27 (b) 16:9 (c) 3 : 4 (d) 2 : 3
Q41. The sub-duplicate ratio of 225:169 is:
(a) 16:15 (b) 39:105 (c) 150:52 (d) 15:13

Q42. The sub-triplicate ratio of 8:125 is:

(a) 125:8 (b) 4:25 (c) 2 : 5 (d) 25:4

Q43. The ratio compounded of 4 : 3, 9 : 8, 5 : 2 and 12 : 10 is :

(a) 9 : 2 (b) 1 : 1 (c) 3 : 8 (d) 1 : 9

Q44. Which ratio among 3:5 and 7:11 is greater?

(a) 3: 5 (b) 7:11 (c) both are equal (d) can’t say
Q45. The ratio of two quantities is 5:6. If the consequent of its inverse ratio is 5, the
antecedent is:
(a) 5 (b) 5 (c) 6 (d) none of these
Q46. The ratio compounded of 4:9 and the duplicate ratio of 3:4 is:
(a) 1:4 (b) 1:3 (c) 3:1 (d) none of these
Q47. The ratio compounded of 4 : 9, the duplicate ratio of 3:4, the triplicate ratio of
2:3 and 9:2 is:
(a) 2:9 (b) 9:2 (c) 1:3 (d) 3:1
Q48. The mean proportional between 12 and 27 is
(a) 15 (b) 18 (c) 21 (d) 24

FILL IN THE BLANKS

1. If C.P = ` 950, gain = 6% then S.P = ______________
2. If C.P = ` 2400, S.P = ` 2592 then gain percent = _______________
11 Objective type questions

3. If S.P = ` 8510, loss = 8% then CP = ___________

1
4. If SP = `1755, gain = 12 % , then C.P= ____________
2
5. An article was bought for ` 13600 and ` 400 was spent on cartage. It was sold
for ` 16800. Then the gain% is _________________
6. Sudhir purchased an old car for ` 765000 and spent ` 115000 on its repairs.
Then he sold it at a gain of 5%. In whole transaction, he gain _____________
7. The selling price of 12 pens is equal to the cost price of 15 pens. Then the gain
percent is ___________
8. The selling price of 16 pencils is equal to the cost price of 15 pencils. Then the
loss percent is _____________
9. A man purchased a video for ` 12000 and sold it to his friend at a gain of 10%.
If his friend sells it to his brother at a loss of 5%, then his brother would pay
_____________for it.
10. On selling a sofa set for `21600, a dealer gains 8%. Then the cost purchase is
_____
11. On selling a sofa set for ` 11400, a dealer loses 5%. Then the cost purchase is
_____
12. On selling a calculator for ` 1325, a dealer gains 6%. Then he should sell it for
rupees _____ to gain 12%
13. On selling a computer for ` 24480, a dealer loses 6%. Then he should sell it for
rupees _____ to gain 4%
(100 − Loss%)
14. sP = × ________
100
100
15. CP = × ____________
(100 + gain%)
16. 3:4 = _____________%
17. 0.75% = ___________________
18. 6% = ______________ expressed in decimals.
19. If x decreased by 40% gives 135 then x = _______________
20. (11% of x) – ( 7% of x ) = 18 then x = _________________
a+b a 5
21. The value of if = is ______________
a−b b 3
22. If a:b is 2:3 and b:c = 4:9 then a:b:c=
1 1 1
23. x = ,y = , z = then x:y:z = _________
3 4 5
24. If 9x+3y:2x+7y=7:8, then x:y= ______________
25. If a:b=2:3, the value of (2a+4b):(4a+3b)= ______________
26. Two numbers are in the ratio 3:4. If 4 is subtracted from each, they are in the
ratio 2:3. The numbers are_____________________
 Percentage, Profit and loss, ratio 12

27. The angles of a triangle are in ratio 2:3:4. The angles are :
28. If ` 1080 is divided between A and B in the ratio 5 : 13. Then the shares of A
and B are_____
29. Samar earns ` 40 in 3 hours and Anil earns ` 60 in 4 hours. The ratio of their
earnings per hour is___
30. The ratio of two numbers is 17:20 and their difference is 123. Then the numbers
are ________________

31. If x:y=3:1,the value of

x 2 y 2 : x 4 + y 4 is ____________

32. If a–k : b– k is the duplicate ratio of a:b then k is________________

33. If a–p : 2b – p is the sub-duplicate ratio of a:2b then relation between p, a, b is
______________
34. If p:q =1:3 and a:b=4:3, then the value of 4pa + 3qb : 9pa + 4qb is ______________
35. The ratio of the speeds of two cars is 7:9. If the second car runs 450 kms. in
10 hours, the speed of the first car is _________
36. The number must be added to each term of the ratio 25:37 that it may become
equal to 5:6 is __________

TRUE/FALSE

1. ¾ as rate percent is 75%.

2. 2:5 = 25%
3. 12.5% expressed as a fraction is 1/8.
4. 20% of 1 litre = 200 ml
5. 80% of 450 = 360
6. If x% of 75 = 12, then the value of x is 1/16.
7. 5% of a number is 9. The number is 160.
8. In an examination it is required to get 36% to pass. A student gets 160 marks
and fails by 20 marks. Then the maximum marks are 500.
9. A number when increased by 20% gives 30. The number is 60.
10. If 35% of a number is added to 39, it gives the number itself. Then the number
is 60
11. Loss = S.P – C.P
12. Profit or loss is always reckoned on S.P.
13. If the C.P of 5 oranges be equal to the selling price of 3 oranges then gain
2
percent is 66 %
3
13 Answers to objective type questions

ANSWERS TO OBJECTIVE TYPE QUESTIONS

A1. (d) 40%
2
× 100 = 40%
5

A2. (d) 10%
x 2 1
× = ⇒ x =10%
100
7 35
A3. (d) 35

20
x+ × x = 42 ⇒ x =35
100
A4. (b) 75
8
x− × x = 69 ⇒ x =75
100
A5. (a) 8 kg
Let x grams of ore is required to obtain 400 grams of zinc.
5
Then × x = 400 ⇒ x =8000 grams = 8kg
100

A6. (a) ` 20000

Let the marked price be ` x
10
Then x − × x = 18000 ⇒ x = 20000
100
A7. (b) ` 16000
Let the original salary be ` x.
25
Then x + × x = 20000 ⇒ x = 16000
100
A8. (b) 700

60
× x = 420 ⇒ x = 700
100
A9. (b) ` 22500
10
Value after one year = 25000 − × 25000 = 22500
100
A10 (c) 450

11 7
×x = × x + 18 ⇒ x = 450
100 100
A11. (a) 60
35
× x + 39 = x ⇒ x = 60
100
 Percentage, Profit and loss, ratio 14

A12. (b) 320

85
× x = 272 ⇒ x = 320
100
2
A13. (a) 91 %
3
In 22 carat gold, pure gold is 22 parts out of 24 parts.
22 2
Hence, percentage of pure gold in it = × 100 = 91 %
24 3
2
A14. (a) 16 %
3
Let the earlier consumption be 100 litres and let its price be `100.
New price of 100 litres = `120
Now, `120 can fetch 100 litres.
100 250
Then `100 can fetch × 100 = litres
120 3
250 2
Reduction in consumption = 100 − = 16 %
3 3
A15. (b) 25%
Let the cost price of each pen be `1. Then CP of 20 pencils = `20.
S.P of 20 pen = C.P of 15 pen = `15
⇒ loss = C.P − s.P = 20 − 15 = 5

loss 5
⇒ loss% = × 100 = × 100 = 25%
C.P 20
A16. We are given that S.P = 336, C.P = 400.
Loss = C.P − s.P = 400 − 336 = 64

Loss 64
Loss% = × 100 = × 100 = 16%
C.P 400
2
A17. (a) 16 %
3
Let the C.P = x Then Gain = x/6
S.P = x + x/6 = 7x/6
According to the question,
7x
= 3220 ⇒ x = 2760
6
Therefore, C.P = ` 2760, S.P = ` 3220
Gain = 3220 – 2760 = 460
gain 460 2

gain % = × 100 = × 100 = 16 %
C.P 2760 3
15 Answers to objective type questions

A18. (b) ` 16790

C.P = 14360 + 240 = 14600
Gain required = 15%. Therefore, SP = 115% of 14600 = 16790
A19. (a) 4% loss
100 100
First radio: CP = × s.P = × 4800 = 4000
(100 + gain%) (100 + 20)
100 100
Second radio: CP = × s.P = × 4800 = 6000
(100 − loss%) (100 − 20)
Total C.P = 4000 + 6000 = 10000
Total S.P = 4800 + 4800 = 9600
loss 400
loss% = × 100 = × 100 = 4%
C.P 10000
A20. (a) 12500
Let the production cost be x
S.P of the manufacturer = 106% of x = 106x/100=53x/50
53x 27
S.P of the wholesaler = 108% of 53x/50 = ×
50 25
53x 27 53x 27 11
S.P of the retailer = 110% of 110% of × = × ×
50 25 50 25 10
But the retail price = ` 15741.
53x 27 11

⇒ × × = 15741 ⇒ x =12500
50 25 10
A21. (a) 7250
Let the C.P be x
106x
S.P at 6% gain=
100
94x
S.P at 6% loss =
100
106x 94x
Difference = − = 870 ⇒ x = 7250
100 100
A22. (b) 25%
A23. (a) 12.5%
A24. (d) ` 72
A25 (c) ` 700
A26 (c) ` 600
A27 (c) ` 176
A28 (a) 1.2
Product of extremes = product of means ⇒ 5x = 8 × 0.75 ⇒ x =1.2
 Percentage, Profit and loss, ratio 16

A29 (a) 0.08

mean proportional = 0.32 × 0.02 = 0.08
A30 (b) 0.00125
Let c be the third proportional to a = 0.32 and b = 0.02 then 0.32 : 0.02 :: 0.02 : c
0.32 × c = 0.02 × 0.02
⇒ c = 0.00125
A31 (b) 1
16 : 4 = 4 : a
⇒a=1
A32. (a) ¾
3 1
: x = ⇒ x =3/4
48 12

A33. (c) 360

Let the number of students be x. Then number of girls = 4x/7
Then 4x = 480 ⇒ x = 840
7
3x 3
No. of boys = = × 840 = 360
7 7
A34 (a) 8:12:15:35
2b
a:b=2:3
⇒a=
3
5b
Also, b : c = 4 : 5 ⇒c=
4
3d
Also, c : d = 3 : 7 ⇒ c =
7
Solving the above equations, we get
2 5 35 2 5 35 2 5 35
a:b:c:d= b:b: b: b = :1: : = × 12 : 1 × 12 : × 12 : × 12 = 8 : 12 : 15 : 35
3 4 12 3 4 12 3 4 12

A35. (b) 2:3

3b

a : b = 3:4 ⇒a=
4
9b
b:c=8:9
⇒c=
8
3b 9b 3 9 3 9
⇒a:c=
: = : = ×8: ×8= 2:3
4 8 4 8 4 8
A36. (b) 3:4:5
a b c
Let = = = k ⇒ a = 3k, b = 4k , c = 5k
3 4 5
Then a : b : c = 3k : 4k : 5k = 3 : 4 : 5
A37. (a) 12/5
17 Answers to objective type questions

a b c
= = =k ⇒ a = 3k, b = 4k , c = 5k
3 4 5
a + b + c 3k + 4k + 5k 12

⇒ = =
c 5k 5
A38. (b) 2:1
2 2 2
We have (x − 2 y) = x + 4y − 4xy =4xy-4xy = 0
x 2

⇒ x − 2y = 0 ⇒ x =2y ⇒ =
y 1
A39. (c) 16:81
The duplicate ratio of 4:9 is 42 : 92 = 16:81
A40. (a) 64:27
The triplicate ratio of 4:3 is 43: 93 = 64:27.
A41. (d)15:13
The sub-duplicate ratio of 225:169 is 225 : 169 = 15 : 13
A42. (c) 2:5
The sub-triplicate ratio of 8:125is 3 8 : 3 125 = 2 : 5
A43. (a) 9:2
product of antecedents 4.9.5.12 9
Compounded ratio = = = =9:2
product of consequent 3.8.2.10 2
A44. (b) 7:11
For comparing two ratios we have to equate their consequents.
3 3 × 11 33
= =
5 5 × 11 55

7 7 × 5 35
= =
× 5 55
11 11
Therefore, 7: 11 is greater
A45. (c) 6
A46. (a) 1:4
The duplicate ratio of 3:4 is 32 : 42 = 9 : 16
4.9 1
Therefore the compounded ratio of 4 : 9 and 9 : 16 is =
9.16 4
A47. (c) 1:3
The duplicate ratio of 3:4 is 32 : 42 = 9 :16 triplicate ratio of 2:3 is 23 : 33 = 8 : 27
The ratio compounded of 4 : 9, 9 :16, 8 : 27 and 9 : 2 is
product of antecedents 4.9.8.9 1
Compounded ratio = = = =1: 3
product of consequent 3.16.27.2 3
A48. (b) 18
 Percentage, Profit and loss, ratio 18

ANSWERS TO FILL IN THE BLANKS

1. ` 1007
2. 8%
3. ` 9250
4. ` 1560
5. 20%
6. ` 924000
7. 25%
8. 25/4 %
9. ` 12540
10. ` 20000
11. ` 12000
12. ` 1400
13. ` 26520
14. C.P
15. S.P
16. 75
17. 75
18. 0.06
19. 225
20. 450
21. 4
22. 8:12:27
23. 20 : 15 :12
24. 25/58
25. 16:17
26. 12,16

27. 40,60,80 Hint : 2x + 3x + 4x = 180 ⇒ x = 20

28. 300,780
29. 8/9
30. 41
31. 9/82
a − k a2
32. ab/a+b Hint: =
b − k b2
19 Answers to true/false

a−p a
33. p 2 = 2ab Hint: 2b − p =
2b
34. 43/72
p : q = 1 : 3;a : b = 4 : 3
⇒ 4pa+3qb:9pa+4qb
Taking compounded ratio of L.H.S and R.H.S, we get pa : qb = 4 : 9
Let pa = 4x,qb = 9x
4pa + 3qb 4.4x + 3.9x
pa = 4 x,qb = 9x then = ⇒ x =43/72
9pa + 4qb 9.4x + 4.9 x

450 7
35. 35 km/hr Hint: s2 = = 45 then = ⇒ s1 = 35
10 s 9
25 + x 5
36. 35 hint: = ⇒ x = 35
37 + x 6

ANSWERS TO TRUE/FALSE
1. True
2. False
3. True
4. True
5. True
6. True
7. False. It should be 180
8. True.
9. False. The number is 25
10. True
11. False
12. False. It is on C.P
13. True
 C H A P T E R

2 Sampling and Sampling

Distributions

Learning Objectives
By the end of this chapter, you will be able to understand:
u Meaning of descriptive and inferential statistics.
u Meaning of population and sample.
u Census method and sample method.
u Difference between parameter and statistics.
u Advantages and disadvantages of sampling.
u Probability and non-probability sampling methods.
u Methods of sampling – Simple random sampling, stratified sampling,
systematic sampling, cluster , multistage sampling, Judgment sampling,
quota sampling and convenience sampling.
u Sampling and Non- Sampling Errors.

2.1 Introduction
In this chapter, we discuss various methods of obtaining information about
a large population for which secondary data is not available. Sometimes, it is
difficult to measure the entire population. In such a case, we have to rely on a
sample of that population. Samples are taken and analysed to get information
about the whole population. In this chapter, we discuss various methods of
selecting samples.

2.2 Descriptive and Inferential Statistics

The science of statistics may be broadly studied under the following two
branches:
20
21 Population and sample Para 2.3

u Descriptive statistics.
u Inferential Statistics.
Descriptive Statistics: It is that branch of statistics which describes some
characteristics of numerical data. In descriptive statistics, we measure two
things: central tendency and variation. We always do descriptive statistics of
our data to get crucial information about the data. It answers the questions of
type – “What type of data we have?”, Can we use our data to represent a larger
group or do we need to collect more data? and many others.
Our statisticians are not only interested in describing data but also in some
larger groups which our data is meant to represent. In such a case, inferential
statistics fulfils our goal.
Inferential Statistics: It is that branch of statistics which deals with statistically
drawing conclusions about totality of cases or items termed as population. In
other words, inferential statistics are used to draw inferences about a population
from a sample. There are two main methods used in inferential statistics –
estimation and hypothesis testing. Inferential statistics is the application of
statistics to a body of data to make inferences about a larger group. It is more
complex because we have to keep in mind what type of data we have, our
research design, our hypothesis and our methods because inferential statistics
is where most of the statistical illiteracy problems arise and where many people
are missed by wrong choice of tests.

2.3 Population and Sample

Population
Population is a large group of individual under study. It is a group of individuals,
persons, objects or items from which samples are taken for measurement.
For example: if an enquiry is intended to determine the spending habits of the
families in Delhi then the population will consist of all house-holds in Delhi. If
a population contains only a finite number of objects or items then it is called
a finite population. For eg: Number of students in a college, daily production
in a factory etc. But if a population contains an infinite number of objects or
with the number of objects so large as to appear practically infinite is termed as
an infinite population eg. Number of rice-eaters and wheat eaters in Northern
India, population of stars in the sky etc.

Sample
A finite subset of the population is called a sample. It is selected from the
population for the purpose of investigating its properties is called a sample.
While dealing with people, it can be defined as a set of respondents selected
from a larger population for the purpose of survey. Number of units in a sample
is called a sample size.
Para 2.5 Sampling and sampling distributions 22

2.4 Census versus Sample Method

There are two methods of collecting the data for any statistical enquiry in any
field of human activity. They are:
u Census method
u Sample method

Census Method:
Census means complete enumeration. In this method, data is collected about
each and every unit of the population or universe. For example, if we want to
know the intelligence level of students of a college then we may conduct an
interview in which each and every student of that college will be interviewed.
Advantages of census method:
u Data is collected from each and every unit of the population.
u Results are more accurate.
u Data collected from census method can be used further.
Disadvantages of census method:
u It is a time consuming process because the data is collected from each
and every unit of the universe.
u Survey of each and every unit of the universe incurs heavy cost.
u If the population is infinite, some of the units are destroyed during
evaluation.
When to use Census method?
u When the population size is small.
u When the population is homogeneous.
u If in course of inspection, some of the units of population are destroyed.
u When the population is not constantly changing.

2.5 Statistics and Parameters

A statistic is a characteristic of a sample and a parameter is a characteristic
of a population. A statistic is a random variable while a parameter is a fixed
value. The statistical constants of the population such as mean, variance etc.,
are usually referred to as parameters. The statistical measures computed
from the sample observations alone such as sample mean, sample variance
are known as statistics.
23 Population and sample Para 2.3

Sample method:
Sampling is the act , process or technique of selecting a suitable sample or a
representative part of a population for the purpose of determining parameters
or characteristics of the whole population. It is that part of statistical practice
which is concerned with the selection of individual observations intended to
yield some knowledge about a population of concern, especially for the purpose
of statistical inference. Sampling process consists of several stages which are
as follows:
u Defining the population of concern.
u Specifying a sampling frame, a set of items or events possible to measure.
u Specifying a sampling method for selecting items or events from the
frame.
u Determining the sample size.
u Implementing the sampling plan.
u Sampling and data collection.
u Reviewing the sampling process.

Advantages of sample method over census method:

1. Reduced cost: Sample method involves less cost as compare to census
method. This is of great advantage in under-developed economy where
it is difficult information through census method because of scarcity of
resources.
2. Greater speed: Data can be collected and summarized more quickly
in a sample method as compare to census method. This may be a vital
consideration when the information is urgently needed. Since only a part
of the population is studied, it is less time consuming and saves a lot of
time and labour.
3. More accuracy: A sample may actually produce more accurate results ac
compare to complete enumeration because personnel of higher quality
can be employed and can be given intense training.
4. More reliability: Results obtained from sampling methods are more
reliable and accurate than census method as it is possible to determine
the sampling errors. Moreover, non-sampling errors are more serious in
census method as compare to sample survey. This is because care can
be taken in sample survey regarding the accuracy of information.
5. Greater Scope: Sometimes, time, money, labour, highly trained personnel
specialized equipment are limited in availability. In such cases, it is possible
to obtain more detailed and exhaustive information from the limited
few units selected in the sample. Moreover, complete enumeration is
Para 2.6 Sampling and sampling distributions 24

impractical rather inconceivable if the enquiry requires highly trained

personnel and more sophisticated equipments for collection, processing
and analysis of data. The sampling method is more readily adaptable than
census method for statistical investigations.
6. More detailed information: It is possible to collect more detailed information
in sample survey as it saves a lot of time, labour and money.
7. Destructive testing: If some of the units of the population are destroyed
then investigator has no other option left but to resort to sampling.

Limitations of sampling or sample method

Despite various advantages of sampling, there are some shortcomings in
sampling which are as follows:
u If a sample survey is not properly planned or designed and executed
carefully, the results obtained will not be reliable and quite often might
even be misleading. Sampling design must be perfect otherwise it might
lead to serious complications in the final results. Moreover, it incurs cost
and time on execution and planning.
u It requires the services of experienced and skilled supervisors otherwise
information obtained from sample surveys cannot be relied upon.
u A census survey is necessary if the information is required for each and
every unit of the population. In such cases, sampling is not useful.
u Sometimes, the sample survey becomes so complicated that it requires
more time, labour and money than a complete census.

2.6 Sampling Methods

Sampling methods can be classified as either probability or non-probability
methods.
Probability Sampling Methods: Sampling method in which each unit of the
population has equal chance of being selected is called a probability sampling
method. Probability samples are selected in such a way that they are the
true representatives of the population. They reflect the characteristics of
the population from which they are selected. Various probability sampling
methods are:
u Simple random sampling
u Stratified sampling
u Systematic sampling
u Multi stage or cluster sampling
25 Simple Random Sampling Para 2.7

Non-Probability Sampling Methods: Sampling method in which each unit of

the population does not have equal chance of being selected is called a non-
probability sampling method. Here, members are selected from the population
in some non-random manner. Non-probability samples may not be the true
representatives of the whole population. Various non- probability sampling
methods are:
u Judgment Sampling
u Convenience Sampling
u Quota Sampling

2.7 Simple Random Sampling

It is the purest form of probability sampling. The term ‘random’ has a very
precise meaning. A simple random sample is one in which every element of
the parent population has an equal chance of being selected in the sample.
For a population comprising N units, the chance of selection of a particular
element being selected is 1/N . The key to random selection is that there is no
bias involved in the selection of the sample. Any variation between the sample
characteristics and the population characteristics is only a matter of chance.
A simple random sample is free from sampling bias. Each individual in the
population of interest has an equal likelihood of selection. Simple random
sampling is the most elementary sampling techniques and forms the basis of
other random sampling techniques.
There are two basic methods by which samples are selected:
1. Sampling with replacement: In sampling with replacement, every element
which is selected is returned back to the sampling frame where it has
the same chance of being selected again. A simple random sample with
replacement means a set of n elements from a population consisting of N
elements such that every sample of even size with elements in a distinct
order has an equal chance of being selected.
2. Sampling without replacement: In sampling without replacement, once an
element is selected , it is not replaced back in the sampling frame. It is kept
aside and has no chance of being included in the sample again. In sampling
without replacement, the chance of an element to be selected in the first
draw is 1/N, while in the second draw, every element has 1/(N-1) chances
of selection and in the third draw, the chance is 1/(N-2) and so on.

Methods of selecting random sample:

There are two ways of selecting random samples.
1. Through table of random digits: In simple random sampling, we use an
unsystematic random selection process i.e., we identify every element in
Para 2.7 Sampling and sampling distributions 26

the sampling frame then choose them on some planned basis ensuring
that every element has the same opportunity of being selected. But if
the sampling frame is too large, we make use of a random number table.
Random number tables contain digits which are not systematically
organised. Whether we look at the rows, columns or diagonally, we would
not find any particular sequence or order in which the digits are placed.
Since our numeric system uses only ten digits from 0-9, the chance of
randomly getting a particular digit is the same as the chance of obtaining
any other digit. The method of drawing a random sample comprises of
the following steps:
(i) Identify N units in the population with the numbers 1 to N.
(ii) Select at random, “any page of the random number table” and pick
up the numbers in any row, column or diagonal at random.
(iii) The population units corresponding to the numbers selected in step
(ii) constitute the random sample.
2. Lottery Method: Under this method, all items of the population are
numbered or named on separate slips of paper of same size and shape.
These slips are folded up and mixed together in a box. Then the required
number of slips are drawn from the box. It is necessary that slips are of
identical size and shape to avoid the possibility of personal bias.
Advantages of Simple Random Sampling:
u There is no possibility of personal prejudice or bias affecting the results
because the selection of items in the sample depends on chance.
u The theory of random samples is subjected to further use in other surveys.
u Accuracy of results can be evaluated. Sampling error can be determined
as it follows the principle of chance.
u It is more representative than judgment sampling. If the sample is selected
by an experienced investigator, then the sample may be regarded as a true
representative of the whole population.
Disadvantages of Simple Random Sampling:
u It includes heavy cost particularly when populations are geographically
dispersed and individuals are difficult to trace.
u It is sometimes difficult for the investigator to have up- to- date lists of all
the items of the population to be sampled.
u Size of the sample is larger in random sampling as compare to stratified
sampling. If the sample is not sufficiently large, then it may not be
representative of the population and thus may reflect the true characteristics
of the population.
27 systematic sampling Para 2.8

u The numbering of the population units and the preparation of the slips
is quite time consuming and uneconomical particularly if the population
is too large. Accordingly, this method cannot be used effectively in social
science projects.
u Sometimes, simple random sample gives results which are highly non-
probabilistic in nature i.e., whose probability is very small.

2.8 Systematic Sampling

It is also a probability sampling method. It is often used instead in random
sampling. A systematic sample is obtained by selecting one unit on a random
basis and choosing additional elementary units at evenly spaced intervals until
the desired number of units is obtained. The sampling here is done as follows:
First of all, the elements of a population are sequenced randomly. Then, the
ratio of the population size, N, to the sample size, n, is calculated and represented
by k. Thus, k = N/n. Note that only integral part of the value of k is considered
here. After that, an element is chosen randomly from the first k elements. This
is the first element selected in the sample. It is followed by selecting every kth
element from the previously chosen element. To illustrate, suppose there are
100 students in a class. We want a sample of 20 from these 100 and we have
their names listed on a piece of paper may be in an alphabetical order. If we
choose to use systematic random sampling, divide 100 by 20. W get 5. Randomly
select any number between 1 and 5. Suppose the number to be picked up is 4
then 4 becomes the starting number. So student number 4 has been selected.
From there, we will select every 5th name until we reach the last one, number
100. We will end up with 20 selected students.
Advantages of systematic sampling:
u Systematic sampling is more simple than random sampling or stratified
sampling.
u It requires less time and work as compare to other methods.
u Systematic sampling may be more efficient than simple random sampling
provided the frame is complete and up-to-date and the units are arranged
serially in a random order like the names in a telephone directory where the
units are arranged in an alphabetical order. However, even in alphabetical
arrangement, certain amount of non-random character may persist.
u It is more useful where very large numbers are included in the target
population and simple random sampling is difficult or where lists are
already grouped in to sections or classes.
Disadvantages of systematic sampling:
Para 2.9 Sampling and sampling distributions 28

u Systematic samples are not always random samples. It is also crucial that
the samples selected are not biased. Systematic samples gives biased results
if there are periodic features in the frame and the sampling interval is
equal to a multiple of the period.
u Systematic samples works well only if the complete and up-to-date frame
is available and if the units are randomly arranged. However, these
requirements are not generally fulfilled.

2.9 Stratified random sampling

Stratified sampling is a common used probability method that is superior to
random sampling. Stratification is the process of grouping members of the
population into relatively homogeneous subgroups before sampling. The strata
should be mutually exclusive i.e., every element in the population must be
assigned to only one stratum. The strata should also be collectively exhaustive
i.e., no population element can be excluded. Then random sampling is applied
within each stratum.
In stratified sampling, the N elements of the population are first sub-divided into
distinct and mutually exclusive sub-populations also called strata according
to some common characteristics. A stratum is a subset of the population that
share at least one common characteristic. For instance, the students of Delhi
University can be divided by their gender, course, college (off campus, North
campus and south campus) etc. After a population is divided into appropriate
strata, a simple random sample is taken within each stratum and the results
from the random samples are then combined.
Advantages of stratified random sampling:
u It focuses on important sub-populations and ignores the irrelevant ones.
u It is more representative.
u It improves the accuracy of estimation.
u Unlike random samples, the stratified samples are expected to be localised
geographically. This reduces the cost and saves time in terms of collection
of data, interviewing the respondents and supervision of the field work.
u Stratification will almost certainly produce gain in precision in the estimates
of the whole population because a heterogeneous population is split into
fairly homogeneous strata.
Disadvantages of stratified random sampling:
u The success of stratified random sampling depends on effective stratification
of the universe into homogeneous strata and appropriate size of the samples.
If stratification is faulty, the results will be biased.
u It is time consuming.
29 Multi-stage sampling Para 2.11

u It requires highly skilled and experienced supervisors.

u It is not useful when there are no homogeneous sub-groups.
u It requires accurate information about the population .
u Disproportional stratified sampling requires the assignment of weights to
different strata and if the weights assigned are faulty, the resulting sample
will not be representative and might give biased results.

2.10 Cluster Sampling

In cluster sampling, clusters are randomly selected and all individuals in a
particular cluster are interviewed. It is used when the target population is
very large and/or geographically dispersed making simple random sampling
extremely expensive and time consuming. One of the challenge faced in this
method is that clusters may be geographical, for instance, villages or urban
city. It is important to ensure that important sub groups are not left out and
also to consider any potential basis in analysis. For instance, if all the clusters
thrown out by random selection are large villages then the results are likely
to be different if some of the villages are very small.
A cluster sample is obtained by selecting clusters from the population on the
basis of simple random sampling. The sample comprises a census of each
random cluster selected. Though very economical, cluster sampling is very
susceptible to sampling bias.
Advantages of Cluster Sampling
u Fixed cost are reduced in cluster sampling.
u It is applicable where no complete lists of units are available.
u It is flexible as it enables existing divisions and sub-divisions of the pop-
ulation to be used as units at various stages.
u It is valuable in surveys of underdeveloped areas where sampling frame
list is unavailable.
Disadvantages of Cluster Sampling
u Clusters may not be representative of whole population but may be too
alike.
u It is more complicated than for simple random sampling.

2.11 Multi-stage sampling

Multi stage sampling involves the selection of units in more than one stage. In
such a sampling, the population consists of number of first stage units, called
primary sampling units (PSUs). Each of these PSUs consists of a number of
second stage units. First a sample is taken of the PSUs, then a sample is taken
Para 2.12 Sampling and sampling distributions 30

of the second stage units. This process continues until the selection of the final
sampling units. At each stage of sampling, a sample can be selected with or
without stratification. For instance, a sample of 5000 urban households from
all over the country is to be selected. In such a case, the first stage sample may
involve the selection of districts. Suppose 25 districts out of 500 districts are
selected. The second stage may involve the selection of cities, say four from
each district. Finally, 50 households from each selected city may be chosen.
Therefore, the sample is selected in three stages.
Advantages
u Multi-stage sampling results in the concentration of field work.
u It is time saving.
u It saves labour and money.
u Where a suitable sampling frame covering the entire population is not
available, a multi – stage sample is used.

2.12 Judgment Sampling

It is the most common non-probability sampling method. It is also called
purposive or subjective sampling. In this method, a desired number of sample
units is selected intentionally or purposely depending upon the objective of
enquiry so that only the important items representing the true characteristics
of the population are included in the sample. The researcher selects the sample
based on his own judgment. While using this method, the researcher must
be confident that the chosen sample is the true representative of the entire
population. A judgment sample is obtained according to the discretion of
someone who is familiar with the relevant characteristics of the population. It
is often used in choosing political polling districts because their pattern in the
past provides good idea of outcomes for whole electorate.
Advantages of Judgment Sampling
u It is simple and easy.
u It is used by businessman for solving everyday problems.
u It is useful when there are only a small number of sampling units in the
universe.
u It is useful where it is particularly important to explore the range of
different potential impacts e.g., ensuring that the quota of women includes
a selection of single women , very old woman, a literate woman and so on.
u If some of the characteristics of the population are known and some are
unknown, then we may stratify the population according to these known
properties and select sampling units from each stratum through judgment
sampling.
31 Quota sampling Para 2.14

Disadvantages of Judgment Sampling

u It is sometimes biased as the results may be affected by personnel bias of
the investigator.
u There is no way of evaluating the reliability of sample results. There is no
method of determining the size of sampling errors.

2.13 Convenience Sampling

Convenience sampling is used in exploratory research where the researcher is
interested in getting an inexpensive approximation of the truth. In this method,
an easily accessible group of people is chosen and everyone in that group is
surveyed. It is a non-probability sampling method in which the investigator
has the freedom to choose whomsoever they find conveniently. For instance,
investigator may chose sample from his close friends or neighbours for the
purpose of knowing their preference for a certain brand of coffee. This non-
probability sampling method is often used during preliminary research efforts
to get a gross estimate of the results without incurring the cost or time required
to select a random sample.
Advantages:
u It is quite easy to organise.
u It is quicker than other methods.
u It is convenient and relatively cheaper to undertake.
u It is very useful in exploratory research.
Disadvantages:
u There is no guarantee that the behaviour of people represent the behaviour
of the whole group i.e., the sample may not be the true representative of
the whole population.
u It does not ensure precision due to lack of control mechanisms.

2.14 QUOTA SAMPLING

Quota sampling is a non-probability sampling method equivalent to stratified
sampling. Like stratified sampling, the researcher first identifies the stratum and
their proportions as they are represented in the population. Then convenience
or judgment sampling is used to select the required number of subjects from
each stratum. This differs from stratified sampling, where the stratum are
filled by random sampling. The defining characteristics of a quota sample is
that a researcher deliberately sets the proportion of strata within the sample.
This is generally done to ensure the inclusion of a particular segment of the
population. The proportions may or may not differ dramatically from the
actual proportion in the population. The researcher sets a quota independent
of population characteristics.
Para 2.15 Sampling and sampling distributions 32

In quota sampling, quotas for certain types of people or organisation are selected
for interview. It is used when the nature of the issues to be investigated means
that it is important to give respondents from particular sub-groups a chance
of being selected which is disproportionate to their numerical strength. Quota
sampling is often used in market research. Interviewers are required to find
cases with particular characteristics. They are given quota of particular types
of people to interview and the quota are organised so that final sample should
be the representative of the whole population.
Advantages of Quota Sampling
u It is less time consuming .
u It requires less cost.
u It gives more detailed information.
u Results are more reliable as compare to result of census study. Another
research is that it is possible to determine extent of sampling errors.
Disadvantages of Quota Sampling
u It is very difficult to estimate accuracy.
u Interviewers chose whom they like and may therefore select those who
are easiest to interview, so bias can result.
u The categories on which quotas are based are crucial and may need to be
refined as the investigation progresses.
u This method could not be adopted if the information is required for each
unit of universe.
u It requires the services of experts for proper planning of survey.

2.15 BIAS AND ERROR IN SAMPLING

ERROR: The difference between true value and the estimated value is called
error. Errors are of two types:
(a) Sampling Errors: These are the errors which occur as a result of sample
surveys. It could be due to faulty selection of sample, ineffective execution,
improper use of estimation techniques and the heterogeneous nature
of the population. A measure of sampling error is called standard error
s
of estimate. Standard Error = , where n is the size of sample. The
n
reciprocal of standard error of estimate is called precision of estimate.
One of the most frequent cause which makes a sample unrepresentative
of its population is sampling error.
33 Bias and Error in sampling Para 2.15

There are two basic causes of sampling error.

1. Chance: Error by chance occurs just because of bad luck. This may result
in untypical choices. Unusual units in a population do exists and there
is always a possibility that an abnormally large number of them will be
chosen.
2. Sampling Bias: It is a tendency to favour the selection of units that have
particular characteristics. Sampling bias is usually the result of a poor
sampling plan. The most notable is the bias of non response when some
of the units have no chance of appearing in the sample. For instance,
take a hypothetical case, where a survey was conducted recently by
Graduate school to find the level of stress that graduate student were
going through. A mail questionnaire was sent to 100 randomly selected
graduate students. Only 52 responded and the results were that students
were not under stress at that time when the actual case was that it was the
highest time of stress for all the students except those who were writing
their thesis at their own pace. Apparently, this is the group that had the
time to respond. The researcher who was conducting the study went back
to the questionnaire to find out what the problem was and found that all
those who had responded were third and fourth Ph.D students. Bias can
be very costly and has to be guarded against as much as possible. For this
case, $2000 had been spent and there were no reliable results. In addition,
it costs the researcher his job as his employer thought if he was qualified,
he should have known that beforehand and planned on how to avoid it.
A means of selecting the units of analysis must be designed to avoid the
more obvious forms of bias.
(a) Non Sampling Errors: This is a measurement error. This type of error
can occur in both census study and in sample survey. Like sampling
error, non-sampling errors may either be produced by participants in
the statistical study or be an innocent by product of sampling plans
and procedures. These errors occur due to certain factors which are
in human control. It arises due to defective methods of data collection
and tabulation, faulty definition, incomplete coverage of population,
lack of trained investigator, error in data processing operations,
personal basis of investigator, non-response from respondents etc. The
simplest example of non-sampling error is inaccurate measurements
due to malfunctioning instruments or poor procedures. For instance,
consider the observation of human weights. If persons are asked to
state their own weights themselves, no two answers will be of equal
reliability. The people will have weighted themselves on different scales
in various states of poor calibration. An individual’s weight fluctuates
diurnally by several pounds so that the time of weighing will affect
the answer. The scale reading will also vary with the person’s state of
undress. Responses therefore will not be of comparable validity unless
 Sampling and sampling distributions 34

all persons are weighed under the same circumstances. In surveys

of personal characteristics, unintended errors may result from : the
manner in which the response is elicited, the social desirability of
the persons surveyed, the purpose of study, the personal basis of the
interviewer .

OBJECTIVE TYPE QUESTIONS

Q1. Which of the following is not a probability sample design?
(a) Stratified sample (b) judgment sample
(c) cluster sample (d) systematic sample
Q2. Which of the following is a probability sample design?
(a) Stratified sample (b) judgment sample
(c) quota sample (d) convenient sample
Q3. Why is census survey not popular?
(a) It is very costly.
(b) It takes more time.
(c) It requires a large number of investigators.
(d) All the above.
Q4. When the sample size increases, which of the following is correct?
(a) The standard error declines.
(b) The standard error remains unchanged.
(c) The standard error increases.
(d) None of the above.
Q5. If the standard error of population is reduced by 50%, the sample size becomes.
(a) Double (b) increases 6 times
(c) increases 4 times (d) none
Q6. The relationship between standard error and sample size can be expressed by
the equation:
s s
(a) s x = (b) s x =
n n
n
(c) s x = (d) none
s
Q7. As standard error decreases,
(a) n decreases (b) n increases
(c) n remains unchanged (d) not necessarily change
35 Objective type questions

Q8. Error that may arise on account of non-response from respondents is :

(a) sampling error (b) non- sampling error
(c) standard error (d) none
Q9. Biased and unbiased errors are type of :
(a) sampling error (b) non- sampling error
(c) standard error (d) none

Q10. Which of the sampling methods is also called purposive sampling?

(a) Quota sampling (b) Judgment sampling
(c) Simple random sampling (d) Stratified sampling
Q11. Which of the sampling methods is also called accidental sampling?
(a) Convenience sampling (b) Judgment sampling
(c) Simple random sampling (d) Stratified sampling
Q12. Table of random digits is used in which type of sampling methods?
(a) Cluster sampling (b) Quota sampling
(c) Stratified sampling (d) Simple random sampling
Q13. Lottery method is used in which type of sampling methods?
(a) Cluster sampling (b) Quota sampling
(c) Stratified sampling (d) Simple random sampling
Q14. A sampling method in which the sample items are returned to the population;
as a result, there is a possibility of their being chosen again in the sample is :
(a) Sampling without replacement. (b) Sampling with replacement
(c) Stratified sampling (d) None
Q15. A sampling method in which the sample items are not returned to the population;
as a result, there is a no possibility of their being chosen again in the sample
is :
(a) Sampling without replacement. (b) Sampling with replacement
(c) Stratified sampling (d) None
Q16. ______________ is the application of statistics to a body of data to make inferences
about a larger group.
(a) Sampling (b) Inferential statistics
(c) Descriptive statistics (d) None
Q17. In ______________ statistics, we measure two things: central tendency and
variation.
(a) Inferential statistics (b) Descriptive statistics
(c) Both (d) None
 Sampling and sampling distributions 36

Q18. It is that branch of statistics which describes some characteristics of numerical

data.
(a) Inferential statistics (b) Descriptive statistics
(c) Sampling (d) Hypothesis testing
Q19. It means complete enumeration.
(a) Sample method (b) Census
(c) Random sample (d) None
Q20. Census method is used when-
(a) When the population size is small.
(b) When the population is homogeneous.
(c) When the population is not constantly changing.
(d) All of the above.
Q21. Sampling process consists of the following stages.
(a) Defining the population of concern.
(b) Specifying a sampling frame and sampling method.
(c) Determining the sample size and implementing the sampling plan.
(d) All of the above
Q22. It is the purest form of probability sampling.
(a) Cluster sampling (b) Simple random sampling
(c) Stratified sampling (d) None
Q23. ______________samples may not be the true representatives of the whole
population.
(a) Non-probability (b) Probability
(c) Random (d) Representative
Q24. It requires the services of experts for proper planning of survey.
(a) Quota sampling (b) Random sampling
(c) Convenient sampling (d) None

Q25. It is very useful in exploratory research.

(a) Quota sampling (b) Random sampling
(c) Convenient sampling (d) None
Q26. A ____________ sample is obtained according to the discretion of someone who
is familiar with the relevant characteristics of the population.
(a) Judgment sampling (b) Random sampling
(c) Convenient sampling (d) None
Q27. It is often used in choosing political polling districts because their pattern in
the past provides good idea of outcomes for whole electorate.
37 Fill in the blanks

(a) judgment sampling (b) Random sampling

(c) Convenient sampling (d) None

Q28. ___________ sampling involves the selection of units in more than one stage.
(a) Multi stage (b) Judgment sampling
(c) Quota sampling (d) Random sampling

Q29. It is the process of grouping members of the population into relatively

homogeneous sub-groups before sampling.
(a) Random sampling (b) Stratification
(c) Probability sampling (d) Clustering
Q30. When there is a significant difference between the statistic and parametric
values, it means that
(a) The difference is real
(b) Statistic value is used to approximate parameter.
(c) Sample statistic is representative of the population parameter.
(d) None of the above.

FILL IN THE BLANKS

1. _________ is a measurement of each element in a group or population of
interest.
2. _________ sampling is a sample design in which a cluster of elements is the
primary sampling unit instead of individual elements in the population.
3. _____________ sample is selected by the researcher on the basis of his
convenience.
4. ___________ population has a limited size.
5. ___________ sample is a non-probability sample based on the judgment of
the researcher who thinks that the sample respondents thus selected would
contribute to answering the question.
6. _________ error is an error that occurs in the collection, recording, tabulation
and comparison of data.
7. ___________ is a sample design in which a sample is drawn in two or more
stages sequentially. The sampling unit in each stage tends to be different.
8. ______________ is a characteristic of population.
9. ______________ is a quantity that remains constant in each case considered
but varies in different cases.
10. The reciprocal of standard error of estimate is called ___________
11. ______________ sample is a non-probability sample that contains a pre-specified
quota of certain characteristic of a population.
 Sampling and sampling distributions 38

12. ______________is a sample that assigns some chance to each element of the
population to be selected in the sample.
13. _____________ is a sample that represents the characteristics of the population
as closely as possible.
14. _____________ is a subset or some part of a population.
15. ______________error is the difference between the population parameter and
the observed probability sample statistic.
16. ______________ is a probability sampling procedure where each element of the
population has an equal chance of being selected.
17. ______________ is the standard deviation of the sampling distribution of a
statistic.
18. ______________ is the property of a sample.
19. _____________ are the groups within a population formed in such a way that
each group is relatively homogeneous but wider variability exists among the
separate groups.
20. _______________ is a sampling method in which a sample is drawn in such a
way that it is systematically spread over all the elements of population.
21. ________________ is a probability sampling method in which sub-samples are
drawn from two or more strata comprising the population. The strata are
more or less _______________

TRUE/FALSE
1. A parameter is a characteristic of a sample.
2. A statistic is a character of a sample.
3. In a random sample, every element in the population has an equal chance of
being selected.
4. The standard error is different from the standard deviation of the distribution
of sample means.
5. A cluster sample is a non-random sample.
6. As the sample size n increases, the standard error not necessarily decreases.
7. A stratified random sampling is one where the population is divided into
mutually exclusive and mutually exhaustive strata.
8. Judgment sampling is not a representative sample.
9. A theoretical sampling distribution implies that all the samples of a given size
are considered.
10. The precision of a sample depends on the proportion of the population sampled.
39 Answers to objective type questions

ANSWERS TO OBJECTIVE TYPE QUESTIONS

A1. (b) judgment sample
A2. (a) stratified sample
A3. (d) All the above.
A4. (a) The standard error declines.
A5. (c) increases four times
s s2 s2
sx =
⇒ n= 2
= = 4(old sample size )
n sx (0.50s x )2
s
A6. s x =
n
A7. (b) n increases
A8. (b) non-sampling error
A9. (a) sampling error
A10. (b) Judgment sampling
A11. (a) convenience sampling
A12. (d) Simple random sampling
A13. (d) Simple random sampling
A14. (b) Sampling with replacement
A15. (a) Sampling without replacement
A16. (b) Inferential statistics
A17. Descriptive
A18. (b) descriptive statistics
A19. (b) census
A20. (d)
A21. (d) All of the above
A22. (b) simple random sampling
A23. (a) Non-probability
A24. (a) quota sampling
A25. (c) convenient sampling
A26 (a) judgment sampling
A27 (a) judgment sampling
A28. (a) multi stage
A29. (b) stratification
A30. (a) The difference is real
 Sampling and sampling distributions 40

ANSWERS To FILL IN THE BLANKS

1. Census 12. Random sample
2. Cluster 13. Representative sample
3. Convenience 14. Sample
4. Finite 15. Sampling error
5. Judgment 16. Simple random sample
6. Non-sampling 17. Standard error
7. Multistage sampling 18. Statistic
8. Parameter 19. Strata
9. Parameter 20. Systematic sampling
10. Precision of estimate 21. Stratified sampling, homogeneous
11. Quota sample

ANSWERS TO TRUE/FALSE
1. False (parameter is a characteristic of population).
2. True
3. True
4. False
5. False (A cluster sample is a random sample.
s
6. False as s x =
n
7. True
8. True
9. True
10. False
 C H A P T E R

3 Formation of Frequency
Distribution and Their
Graphical Representation

Learning Objectives
By the end of this chapter, you will be able to understand:
u Concept of raw data and frequency distribution
u Construction of tables and Pie chart
u Construction of histogram, frequency polygon, frequency curve and ogive.

3.1 Introduction
In the previous chapter, we came to know about various data collection
techniques through sampling. After the process of data collection, the next
step is to organise the data in the form of tables, or frequency distribution.
In order to analyse this data, we use various statistical tools such as charts,
histograms, frequency polygons, frequency curves etc. All this statistical tools
will be discussed in this chapter.

3.2 Frequency Distribution

A frequency distribution is a table in which the data grouped into classes and
the number of cases which fall in each class are recorded. The number of times
each value is repeated is called the frequency of that class. There are two types
of frequency distributions which are as follows:
Discrete Frequency Distribution: The process of preparing this type of distribution
is very simple. We just need to count the number of times a particular value
is repeated. This can be done by using tally marks. In the first column, we
place all possible values of variable from the lowest to highest. Then put a bar
(vertical line) opposite to that particular value in the column of tally marks. To
facilitate counting, blocks of five bars are prepared and some space is left in
41
Para 3.2 formation of frequency distribution & representation 42

between each block. We finally count the number of bars and get frequency.
We explain the process of forming discrete frequency distribution with the
help of following illustration.

Example1: Marks obtained by 35 students of a class in a test are given below:

9, 7, 9, 4, 5, 4, 3, 8, 7, 3, 3, 5, 6, 7, 8, 4, 5, 12, 6, 3, 2, 5, 2, 0, 4, 3, 2, 7, 6, 5, 4, 3, 2, 0, 1
Represent the data in the form of a discrete frequency distribution.
Solution: Discrete Frequency Distribution
Marks Tally Marks Frequency
0 || 2
1 | 1
2 |||| 4
3 ||||| 6
4 |||| 5
5 |||| 5
6 ||| 3
7 |||| 4
8 || 2
9 || 2
10 - 0
11 - 0
12 | 1
Total = 35
Continuous Frequency distribution: We will first consider the basic terminology
regarding the formation of continuous frequency distribution.
1. Class Limits or class boundary: The class limits are the lowest and the
highest values that can be included in the class. For instance, the lower
limit of the class interval 10 – 20 is 10 and the upper limit of this class
interval is 20. The lower limit of the class is the value below which there
can be no item in the class. The upper limit of the class is the value above
which no item can belong to that class. Like in the above class interval,
no value below 10 and no value above 20 can belong to this class.
2. Class Intervals: The difference between the upper limit and lower limit
of a class is known as class interval of that class. For example, in the class
100-200, the class interval is 200-100 = 100. An important decision while
constructing a frequency distribution is about width of the class interval.
The decision would depend upon a number of factors such as the range
in the data i.e., the difference between the smallest and the largest item,
43 Frequency distribution Para 3.2

the number of classes to be formed etc. The width of the class interval is
selected by using the formula :
L−s
h=
k
where L = largest item
S = Smallest item
k = The number of classes
h = width of the class
After forming the class intervals, frequencies of each class interval will
be recorded in the same way as we did in the discrete series.
3. Class frequency: The number of observations corresponding to a particular
class is known as the frequency of that class or the class frequency.
4. Class Mark: It is the value lying half-way between the lower and upper
class limits of a class interval. It is calculated as follows:
Upper limit of the class + lower limit of the class
Mid - point of the class =
2
For the purpose of further calculations in statistical work, the mid-point of each
class is taken to represent that class. There are two methods of classifying the
data according to class – intervals which are as follows.
(i) Exclusive method: When the class intervals are so fixed that the upper limit
of one class is the lower limit of the next class, it is known as the exclusive
method of classification. Exclusive method ensures the continuity of the
data in as much as the upper limit of one class is the lower limit of the
next class. For instance,the data in the following example is classified on
the basis of exclusive method.
Marks No. of students
0-10 50
10-20 36
20-30 67
30-40 42
40-50 85
Total = 280
In the above example, there are 50 students whose marks are above 0
and less than 10. A student whose marks are 10 will be included in the
class 10-20.
(ii) Inclusive Method: Under the inclusive method of classification, the upper
limit of one class is included in that class itself. The following example
illustrates this method.
Para 3.2 formation of frequency distribution & representation 44

Marks No. of students

0-9 50
10-19 36
20-29 67
30-39 42
40-49 85
Total = 280
In the class 0-9, we include only those students whose marks are between 0
and 9. If the marks are exactly 10, he is included in the next class.
To decide whether to use the inclusive or the exclusive method, it is important
to determine whether the variable under observation is a continuous or discrete
one. In case of continuous variables, the upper limit exclusive method must
be used. The inclusive method should, in general, be used in case of discrete
variables. For example, in the survey of 100 families, the number of children
per family will be classified as 0-1, 1-2, 2-3, 3-4 and so on.

Example 2: Prep are a continuous frequency distribution from the following

observations.

75 42 70 37 62 70 50
60 45 81 56 31 45 25
31 62 78 80 78 56 55
75 58 72 32 50 26 70
15 55 40 68 35 60 60
42 81 43 69 65 62 58
42 80 40 45 75 45 62
Solution: Continuous Frequency Distribution

Class intervals Tallies Frequency

15-25 | 1
25-35 |||| 5
35-45 |||| ||| 8
45-55 |||| | 6
55-65 |||| |||| ||| 13
65-75 |||| || 7
75-85 |||| |||| 9
Total = 49
45 Tabulation of data Para 3.3

Relative Frequency Distribution: In order to convert a frequency distribution to

a relative frequency distribution, each of the class frequencies is divided by the
total number of frequencies so that the total of relative frequencies is always 1.

Example 3: Construct a relative frequency distribution from the data given below
taking the class width as 10.

42 31 19 14 23 28 17 53 22 21
20 30 63 9 30 29 12 21 32 25
18 42 38 44 7 39 6 15 41 45
30 2 44 15 37 5 36 31 46 46
19 24 22 30 30 13 31 30 44 6
Solution: Smallest item is 2 and the largest item is 63 and the class width to be
taken is 10, therefore, we make the class intervals as 0-10, 10-20 and so on.
Relative frequency Distribution

Class Interval Tally Marks Frequency Relative frequency

0-10 |||| | 6 6/50=0.12
10-20 |||| |||| 9 9/50=0.18
20-30 |||| |||| 10 10/50=0.2
30-40 |||| |||| |||| 14 14/50= 0.28
40-50 |||| |||| 9 9/50=0.18
50-60 | 1 1/50=0.02
60-70 | 1 1/50=0.02
Total =50 Total = 1

3.3 Tabulation of Data

One of the simplest method of summarizing data and presenting them in a
meaningful fashion is the statistical table. A table is a systematic arrangement
of statistical data in columns and rows. Rows are horizontal arrangements and
columns are vertical arrangements. The purpose of a table is to simplify the
presentation and to facilitate comparisons.

Formation of a One way table or Simple table:

This type of a table is formed when only one characteristic is to be shown.
Para 3.4 formation of frequency distribution & representation 46

Example 4 : Number of Employees in an Organisation according to age group

Age ( in years) No. of employees

Below 25 12
25-35 10
35-45 8
45-55 10
Above 55 10
Total 50
Formation of a Two – Way table: When two characteristics are to be shown,
then a two – way table is to be formed. The following example illustrates the
nature of this table:
Distribution of Students on the basis of courses

Course Gen SC ST OBC Total

B.Sc(H) Maths 70 10 2 18 100
B.Sc(H) Physics 100 20 4 16 140
B.Sc(H) Chemistry 100 20 4 16 140
B.Sc(H) Zoology 90 15 3 12 120
B.Sc(H)Botany 90 15 3 12 120
Total 450 80 16 74 620

3.4 Graphical Representation of a Frequency

Distribution
A frequency distribution can be presented graphically in any of the
following ways:
1. Histogram
2. Frequency Polygon
3. Smoothed Frequency Curve
4. Ogive or cumulative frequency Curve
3.4.1 Histogram: A histogram is a set of vertical bars whose areas are proportional
to the frequency represented. To construct a histogram, take the variable on X
axis and frequencies on Y axis. Each class is then represented by a distance on
the scale that is proportional to its class interval. The distance of each rectangle
on X axis shall remain the same in case the class intervals are equal. The Y
axis represents the frequencies of each class which constitute the height of its
47 Graphical representation Para 3.4

rectangle. Histograms are mainly used for the graphical representation of a

frequency distribution with open-end classes. In case of unequal class intervals,
find the relative frequency density for each class. The frequency density is
defined as the frequency of that class divided by the width of that class. For
making adjustments, we take the class having the lowest class size and adjust
the frequencies accordingly. In case, the midpoints of the classes are given
then find the upper and lower limits of various classes and then construct the
histogram as usual.

Example 5: Prepare a histogram for the data given below:

Marks: 0-10 10-20 20-30 30-40 40-50 50-60 60-70 70-80

No. of students: 8 12 22 35 40 60 52 40

histogram

30 27
number of students

25 19
20 15
15 12 12
7 8
10
5
0
0-10  10-20 20-30 30-40 40-50 50-60 60-70

marks

Example 6: Draw a histogram of the following data:

Mid values frequency

5 7
15 19
25 27
35 15
45 12
55 12
65 8
Solution: Since we are given the mid values, we first the class intervals. Since
differences between the two consecutive mid-values is 10 therefore the
corresponding class intervals are:
Para 3.4 formation of frequency distribution & representation 48

Class intervals frequency

0-10 7
10-20 19
20-30 27
30-40 15
40-50 12
50-60 12
60-70 8

histogram

30
27
25

20 19
frequency

15
15
12 12
10 8
7
5

0
0-10  10-20  20-30 30-40 40-50 50-60  60-70

Class Intervals

Example 7: Represent the data given below by means of histogram.

Income: (in 10-15 15-20 20-25 25-30 30-40 40-60 60-80

thousands of Rs.)
No. of workers: 7 19 27 15 12 12 8

Solution: Since the class intervals are not equal, we first make them equal by
adjusting the frequencies on the assumption that the frequencies are uniformly
distributed throughout the distribution. Since the lowest class size is 5, we
divide the frequency of class 30-40 by 2 and that of 40-60 by 4 etc.
49 Graphical representation Para 3.4

35
30 27
25
19
20
Wages (in Rs)

15
15
10 7
6
5 3 2

0 10 15 20 25 30 35 40 45 50 55 60 65 70 75 80
No. of workers
Fig. 1.4 Histogram
3.4.2 Frequency Polygon: Frequency polygon has more than four sides. It is
used when we have to compare two or more frequency distribution because
in such cases, histograms cannot be used. There are two ways of constructing
a frequency polygon.
(a) First, draw a histogram of the given data and then join the midpoints of
the upper horizontal side of each rectangle with the adjacent rectangles
by straight lines. Close both the ends of the polygon by extending them to
the base line. This introduces two hypothetical classes at each end, each
having a frequency zero.
(b) Another method of constructing a frequency polygon does not involve
the construction of histogram. Here, we have to take the mid-point of
the various class intervals and then plot the frequency corresponding to
each point. Then join all these points by straight lines. When we have to
compare several distributions, this method is used to prepare frequency
polygon of each distribution on the same axis.

Example 8 : Draw a frequency polygon by first drawing a histogram from the

data given below:

Weekly wages (in Rs): 0-10 10-20 20-30 30-40 40-50 50-60 60-70
No. of workers: 7 19 27 15 12 12 8
Para 3.4 formation of frequency distribution & representation 50

Solution :

frequency polygon
16
14
14
12
12
no. of workers

10
7 7 8 8
8
6
6
4
4
2
0
0 0 0 0 0 0 0 0
10 20 30 40 50 60 -70 -80
0- 00
-
00
-
00
-
00
-
00
-
00 00
1 2 3 4 5 6 7

weekly wages in RS.

Example 9: Represent the following data by means of a frequency polygon.

Variable : 0-100 100-200 200-400 400-500 500-600 600-700 700-900 900-1000

Frequency: 4 6 14 12 14 8 16 5
Solution : Since the class intervals are unequal, we adjust the frequencies. The
class 200-400 would be divided into two parts 200-300, 300-400 each with
frequency 7. Similarly adjustment will be made for class 700-900.
Then the distribution will be:

Variable Frequency
0-100 4
100-200 6
200-300 7
300-400 7
400-500 12
500-600 14
600-700 8
700-800 8
800-900 8
900-1000 5
51 Graphical representation Para 3.4

16
F 14
14
12
r 12
e 10
8 8 8
q 8 7 7
6
6 5
u 4
4
e 2
n 0
c 0 00 00 00 00 0 0 0 0 0
10 -2 -3 -4 -5 60 70 80 90 00
0- 0 0 0 0 0- 0- 0- 0- -1
y 10 20 30 40 5 0 6 0 7 0 8 0
90
0

Variable

3.4.3 Smoothed Frequency Curve: The objective of smoothing a frequency

curve is to eliminate accidental variations. To draw a smoothed frequency
curve, we perform the following steps.
1. Draw a histogram of the given data.
2. Draw a frequency polygon.
3. Smooth it by free hand in such a manner that the area included under
the curve is approximately the same as that of the polygon.
4. Extend the curve to the midpoints of the class intervals just outside the
histogram. The curve should begin and end at the base line.

Example 10: Represent the following data by means of a smoothed frequency curve.

Height of 0-7 7-14 14-21 21-28 28-35 35-42 42-49 49-56

trees (in ft):
No. of trees: 25 32 35 40 32 15 50 19
Para 3.4 formation of frequency distribution & representation 52

Solution :

45
40
35
No. of Trees

30
25
20
15
10
5

0 7 14 21 28 35 42 49 56 63 70
Height of Trees
Fig. 1.10. Smoothed Frequency curve

3.4.4 Cumulative Frequency Curves or Ogives : The curve obtained by plotting

cumulative frequencies is called cumulative frequency curve or an ogive. There
are two methods of constructing ogives:
(a) Less than ogive: In the “less than ogive” method, we start with the upper
limit of the classes and go on adding the frequencies. This is called “less
than c.f”. Now plot these frequencies with the upper limit of each class
interval. The curve so obtained is a rising curve and is called “less than
ogive”.
(b) More than ogive: In the “more than ogive method”, we start with the
lower limit of the classes and more than cf of each class. Now plot these
frequencies with the lower limit of each class interval. The curve so
obtained is a declining curve and is called “more than ogive”.

Example 11 : Draw the two ogives in the data given below.

Daily wages (`) No. of workers

0-10 3
10-20 9
20-30 15
30-40 30
40-50 18
50-60 5
53 Graphical representation Para 3.4

Solution:

Class interval Frequency(f) c.f (less than) c.f (more than)

0-10 3 3 80
10-20 9 12 77
20-30 15 27 68
30-40 30 57 53
40-50 18 75 23
50-60 5 80 5
Now plot the less than c.f values with the upper limit of each class interval.
This gives the less than ogive. Then we plot the more than c.f values with the
lower limit of each class interval. This gives more than ogive.
90

80

70

60
OGIVE (Less than)
No. of Workers

50

40

30 OGIVE (More than)

20
Median
10

0
10 20 30 40 50 60 70 80 90

Daily Wages (Rs.)

Fig. 9.4. Graphical determination of median.

Pie Chart: Pie charts are very popularly used in practice to show the percentage
breakdowns. For instance, we can show how the expenditure of the government
is distributed over different heads like irrigation, agriculture, industry, transport
and defence through pie charts. The pie chart is so called because the entire
graph looks like a pie and the components resemble slices cut out from a pie.
Para 3.4 formation of frequency distribution & representation 54

Example 12: Draw a pie chart for the data given below.
Agriculture 12.9%
Irrigation 12.5%
Energy 27.2%
Industry 15.4%
Transport 15.95%
Services 16.1%
percentage
Solution: The angle at the centre = × 360 = percentage × 3.6
100
Computation for Pie chart

Sector Percentage Angle in degrees

Agriculture 12.9 12.9 × 3.6 = 46
Irrigation 12.5 12.5 × 3.6 = 45
Energy 27.2 27.2 × 3.6 = 98
Industry 15.4 15.4 × 3.6 = 56
Transport 15.9 15.9 × 3.6 = 57
Services 16.1 16.1 × 3.6 = 58
Total 100 360
Now a circle shall be drawn and divided into six parts according to degrees
of angle at the centre.

16.10% 12.90%
agri

irri
12.50%
Energy
15.90%
industry

transport

15.40% 27.20% services

55 Objective type questions

OBJECTIVE TYPE QUESTIONS

Q1. While tabulating grouped data:
(a) Each group must have frequencies.
(b) Frequency can be either positive or negative.
(c) It is necessary to have frequencies.
(d) None of the above.
Q2. The upper limit of class intervals is required when we consider the formation
of :
(a) Relative frequency
(b) more than cumulative frequency
(c) Less than cumulative frequency
(d) None of the above
Q3. The first step in the formation of a frequency table is
(a) Choosing a suitable size or width of class intervals.
(b) Deciding an appropriate number of class groupings.
(c) Establishing the boundaries of each class intervals.
(d) Classifying the data into the appropriate classes.
Q4. In a frequency distribution, classes are all inclusive because
(a) None of the data points fall into more than one class.
(b) The given data must fit into one class or another.
(c) There are always more classes than data points.
(d) None of the above
Q5. The number of classes in a frequency distribution depends on:
(a) Size of the population
(b) Range of the observations in the data set.
(c) Number of data points.
(d) Both (b) and (c)
Q6. In a relative frequency distribution, frequencies are in
(a) Whole numbers
(b) Percentages
(c) Fractions
(d) Percentages and fractions both.
Q7. Which of the following is not an example of compressed data?
(a) Data array
(b) A frequency curve
 formation of frequency distribution & representation 56

(c) Histogram
(d) A frequency distribution
Q8. While preparing a frequency table, which of the following number of classes
is generally used?
(a) Less than five
(b) Between 10-20
(c) Between 5-10
(d) None of the above
Q9. ____________ is a set of vertical bars whose areas are proportional to the
frequency represented.
(a) Bar graph (b) Histogram
(c) Frequency polygon (d) Smoothed frequency curve.
Q10. A frequency distribution cannot be presented graphically by :
(a) Histogram (b) Frequency Polygon
(c) Mean (d) Smoothed Frequency Curve
Q11. Q15 are based on the following diagram

12.90% agri
16.10%
irri
12.50%
Energy
15.90%
industry
transport
15.40% 27.20% services

Q11. In the above pie chart, angle traced by irrigation sector is :

(a) 45 (b) 46 (c) 98 (d) none
Q12. Angle corresponding to agriculture sector is :
(a) 45 (b) 46 (c) 43 (d) None
Q13. Which of the following sectors represent 15.4% of the total area in the pie
chart?
(a) Industry (b) Agriculture
(c) Transport (d) Irrigation
57 fill in the blanks

Q14. An angle of 58 degrees is contributed by which sector in the above pie chart?
(a) Services (b) Industry
(c) Agriculture (d) Transport
Q15. An angle of 98 degrees is contributed by which sector in the above pie chart?
(a) Services (b) Industry
(c) Energy (d) Transport
Q16. Which of the following is the best method to show the expenditure of a house
hold in the five major heads as food, rent, clothing, fuel and miscellaneous.
(a) Frequency polygon
(b) Smoothed frequency curve
(c) Histogram
(d) Pie chart
Q17. The expenditure of the government is distributed over different heads like
irrigation, agriculture, industry, transport and defence. It can be represented
diagrammatically through
(a) pie charts. (b) Smoothed frequency curve
(c) Median (d) Polygon
Q18. In the ___________ogive method”, we start with the lower limit of the classes
and more than cumulative frequency of each class.
(a) Less than (b) More than
(c) Both (a) and (b) (d) None
Q19. It is the curve obtained by plotting cumulative frequencies.
(a) Ogive (b) Frequency polygon
(c) Pie chart (d) None
Q20. In a _______, two hypothetical classes are introduced at each end, each having
a frequency zero.
(a) Frequency polygon (b) Pie chart
(c) Histogram (d) Smoothed frequency curve

FILL IN THE BLANKS

1. _______________ is the upper and lower limits of each class interval.
2. _______________ is the number of values in a data set that belongs to a certain
class.
3. _______________ is the number of times a particular value is repeated in a
distribution.
 formation of frequency distribution & representation 58

4. _______________ is the frequency of a class that includes all values in a data

set that fall below the upper boundary of that class.
5. _______________ is the raw data arranged in either an ascending or a descending
order.
6. _______________ is a collection of data.
7. _______________ is a series of data where data are distinct numbers with gaps
between them.
8. ______________ is any item that occurs a specific number of times.
9. ______________ is the frequency in a category divided by total number of
observations.
10. ______________ is the difference between the highest value and the lowest
value divided by the number of class intervals.
11. A ______________ is a table in which the data grouped into classes and the
number of cases which fall in each class are recorded.
12. ________ are used to facilitate counting in statistics.
13. _________ is the value lying half-way between the lower and upper class limits
of a class interval.
14. The difference between the upper limit and lower limit of a class is known as
_____of that class.
15. When the class intervals are so fixed that the upper limit of one class is the lower
limit of the next class, it is known as the ___________ method of classification.
16. Under the _____________ method of classification, the upper limit of one class
is included in that class itself.
17. To decide whether to use the inclusive or the exclusive method, it is important
to determine whether the variable under observation is a ___________ or
__________
18. In a relative frequency distribution, each of the class frequencies is divided
by the total number of frequencies so that the total of relative frequencies is
always ___________.
19. A ________ is a systematic arrangement of statistical data in columns and rows.
20. ____________ are horizontal arrangements and _________ are vertical
arrangements.
21. The purpose of a table is to simplify the ________ and to facilitate ______________.
22. In ___________, only one characteristic is to be shown.
23. In __________, two characteristics are to be shown.
24. _____________ is a form of bar chart in which the height of the bar represent
the absolute or relative frequency of occurrence of the variable of interest.
25. ________ is a curve drawn for cumulative frequency distribution.
26. ______ is a circle divided into portions that represent the relative frequency
or percentages of different categories or classes.
59 Answers to objective type questions

27. _____________ is a graph formed by joining the mid-points of the tops of

successive bars in a histogram by straight lines.
28. _____________is a line graph connecting the mid-points of each class in a data
set, plotted at a height corresponding to the frequency of the class.
29. ________ is defined as the frequency of that class divided by the width of that
class.
30. The objective of smoothing a frequency curve is to eliminate ___________.

TRUE/FALSE
1. Too much data given in one table may reduce its utility.
2. A discrete series always consist of whole numbers or integers.
3. A relative frequency can be obtained by dividing the frequency by the total
number of observations.
4. A class width of a frequency distribution should always be of equal size.
5. A relative frequency distribution does not have all inclusive and mutually
exclusive classes.
6. In a simple table, many characteristics can be shown.
7. The angle at the centre is given by percentage multiplied by 360 in a pie chart.
8. In the “more than ogive” method, we start with the upper limit of the classes
and go on adding the frequencies.
9. The less than ogive curve is a rising curve.
10. More than ogive curve can be both rising or declining.

ANSWERS TO OBJECTIVE TYPE QUESTIONS

A1. (c) It is necessary to have frequencies.
A2. (c) less than cumulative frequency
A3. (c) Establishing the boundaries of each class intervals
A4. (b) The given data must fit into one class or another.
A5. (d) Both (b) and (c).
A6. (d) Percentages and fractions both
A7. (a) Data Array
A8. (d) None of the above.
A9. (b) Histogram
A10. (c) Mean
A11. (a) Angle = percentage × 3.6 12.5 × 3.6 =45
A12. (b) 12.9 × 3.6 = 46
A13. (a) Industry
 formation of frequency distribution & representation 60

A14. (a) Services

58 = percentage × 3.6. This gives percentage = 16.1 which corresponds to
service sector.
A15. (c) Energy
98 = percentage × 3.6. This gives percentage = 27.2 which corresponds to
energy sector.
A16. (d) Pie chart
A17. (a) Pie chart
A18. (b) More than
A19. (a) ogive
A20. (a) Frequency polygon

ANSWERS TO FILL IN THE BLANKS

1. Class boundary.
2. Class frequency
3. Frequency
4. Cumulative frequency
5. Data array
6. Data Set
7. Discrete series
8. Frequency
9. Relative frequency
10. Class width
11. frequency distribution
12. Tally marks
13. Class mark
14. class interval
15. exclusive
16. inclusive
17. continuous or discrete
18. one
19. table
20. Rows, columns
21. Presentation, comparison
22. One way table
23. Two way table
61 answers to true/false

24. Histogram
25. Ogive
26. Pie chart
27. Polygon
28. Frequency polygon
29. frequency density
30. accidental variations

ANSWERS TO TRUE/FALSE
1. True
2. False
3. True
4. False
5. False
6. False. (only one characteristic can be shown)
7. False. Angle = percentage multiplied by 3.6
8. False. It is less than ogive.
9. True
10. False. More than ogive curve is declining
 C H A P T E R

4 Measures of Central Tendency

Learning Objectives
By the end of this chapter, you will be able to understand:
u Meaning of average or central tendency
u Properties of a good average
u Measures of Central Tendency: Arithmetic mean, Median, Mode
u Properties of different types of averages.
u Determination of median and mode for grouped data graphically.

4.1 Introduction
One of the objectives of statistical analysis is to determine various numerical
measures which describes the inherent characteristics of a frequency
distribution. The first of such measures is average. The term “average” is very
commonly used in day to day conversation. The first and foremost objective
of statistical analysis is to get one single value that represent or describes the
entire data. Such a single value is called average or central value.

4.2 Definition of Average

Different statisticians gave different definitions of average from time to time.
Some of them are:
“Average is an attempt to find one single figure to describe whole of figures”.
-Clark
“Averages are statistical constants which enable us to comprehend in a single
effort the significance of the whole.” -A.L. Bowley

62
63 Various measures of central Tendency Para 4.4

“An average is a single value within the range of the data that is used to
represent all the values in the series. Since an average is somewhere within the
range of the data, it is sometimes called a measure of central value”. - Croxton
and Cowden

4.3 Properties of a Good Average

A good measure of central tendency should possess the following properties:
1. It should be rigidly defined. It means that the definition should be clear
so that it leads to one and only one interpretation.
2. It should be easy to understand and simple to calculate. It should be so
easy that even a non-mathematical person can calculate it.
3. It should be based on all the observations. It means that entire set of data
should be used in computing average and there should not be any loss of
information resulting from not using the available data.
4. It should be capable of further algebraic treatment. Average should be
capable of further mathematical and statistical computations to expand
or enhance its utility.
5. It should not be unduly affected by extreme observations. Average should
be such that it should not be affected by the presence of one or two very
small or very large observations.
6. It should not be affected too much by fluctuations of sampling. It should
have sampling stability. By sampling stability, we mean that if we take
different samples of same size from a large population and compute the
average of each sample, we expect to get the same answer approximately.
There can be slight fluctuations in values of different samples.

4.4 Various Measures of Central Tendency

In this section, we will discuss the following measures of central tendency
which are most commonly used in practice.
(i) Arithmetic Mean – Simple and Weighted Mean
(ii) Median
(iii) Mode
4.4.1 Arithmetic Mean: The most popularly used measure of central tendency
is arithmetic mean or simply mean. Arithmetic mean is of two types :
1. Simple arithmetic mean
2. Weighted arithmetic mean.
Para 4.4 measures of central tendency 64

Simple Arithmetic Mean or Mean

A. In case of ungrouped data:
1. In case of individual observations: Let X1,...,Xn be the given observations.
Then arithmetic mean or A.M of these observations is denoted by X
and is given by

X =
∑X
n
where n is the number of observations.
Short-cut method:

X =A+
∑ d , where d = X − A
n
where A is the assumed mean.
2. In case of discrete frequency distribution:
(a) Direct Method: The formula for calculating mean in a discrete series
is :

X =
∑ fX
∑f
where f = frequency , X denotes given observations.
(b) Short-cut Method:

X =A+
∑ fd , where d =X - A
∑f
where A is the assumed mean.
B. In case of grouped frequency distribution or continuous series:
(a) Direct Method:

X =
∑ fm
∑f
where m is the mid-value of each class interval and is given by
lower limit + upper limit
m=

2
(b) Short-cut method:

X =A+
∑ fd , where d =m - A
∑f
where A is the assumed mean , m is the mid-value of each class interval.
65 Various measures of central Tendency Para 4.4

(c) Step-deviation method or coding method:

X =A+
∑ fu × i , where u = m − A
∑f i

where A = assumed mean, m = mid-value of each class interval, i =

step factor

Properties of Arithmetic mean

The following are a few important properties of arithmetic mean:
1. The sum of the deviations of the items from the arithmetic mean is always
zero, i.e., ∑ (X − X ) = 0
2. The sum of the squared deviations of the items from the arithmetic mean
2
is minimum, i.e., ∑ (X − X ) is minimum.
3. If each item of a series is increased or decreased by a constant k, then
the arithmetic mean of the new series also get increased or decreased by
k, i.e., New mean = X + k
4. If each item of a series is multiplied by a constant k then the arithmetic
mean of the new series also gets multiplied by k, i.e., New mean = kX
5. Combined Arithmetic Mean : Consider two related groups such that N1 and
N2 are the number of observations in first and second groups respectively.
Let X 1 and X 2 be their respective means. Then the mean of the two groups
taken together or their combined mean X 12 is given by
N 1X 1 + N 2 X 2
X 12 =
N1 + N 2
The formula can be extended to more number of groups.

Merits of Arithmetic Mean

1. It is simple to calculate and easy to understand.
2. It is based on each and every observation of the series.
3. It does not fluctuate with sampling.
4. It does not depend upon the position in the series.
5. It is capable of further algebraic treatment.
6. It is rigidly defined. Everyone will get the same answer when apply the
formula of average.
Para 4.4 measures of central tendency 66

Demerits of Arithmetic Mean

1. It is unduly affected by extreme values, i.e., by the presence of very large
and very small items. For instance, mean of 55, 54, 49, 50, 5 is 42.6 but
42.6 is not a single value that represent the whole of data as one single
item 5 has affected the average so much.
2. It cannot be determined by inspection like mode and it cannot be located
graphically.
3. In case of open-end classes where the lower limit of the first class interval
and upper limit of the last class interval is not known, mean sometimes
introduces error. In such cases, assumptions should be made regarding
the size of the class interval of open-end classes. In such cases, median
and mode are the most suitable averages.
4. Mean is not a suitable average in case of qualitative data such as honesty,
beauty, voice quality etc. In such cases, rank correlation is computed.
5. Mean is not a good measure of central tendency in case of normal
distribution and in case of U shaped distribution.

Example 1: (Mean in individual observations)You are given the marks obtained

by eight students of B.Com. Find the mean marks.
Roll No. 1 2 3 4 5 6 7 8
Marks: 56 60 62 53 78 45 51 61

Solution: The given data is in the form of individual observations.

X =
∑X =
56 + 60 + 62 + 53 + 78 + 45 + 51 + 61
n 8
466
= = 58.25 marks
8
Example 2: (Mean by shortcut method in individual observations): Compute mean
from the following data:
260.21, 260.22, 260.16, 260.17, 260.15, 260.17, 260.12, 260.15, 260.13, 260.12
Solution: Computation of Mean

X d = X – A = X - 260
260.21 0.21
260.22 0.22
260.16 0.16
260.17 0.17
260.15 0.15
260.17 0.17
67 Various measures of central Tendency Para 4.4

X d = X – A = X - 260
260.12 0.12
260.15 0.15
260.13 0.13
260.12 0.12

∑ d = 1.60
By short-cut method, X = A + ∑ d , where d =X - A
n
1.6
= 260 + = 260.16
10
Example 3: (Mean in discrete series by direct method) Compute the mean marks
from the following data:

Marks: 65 55 45 35 25 15 5
No. of students: 4 6 10 20 10 6 4
Solution:
Computation of Mean
Marks(X) No. of students (f) fX
65 4 260
55 6 330
45 10 450
35 20 700
25 10 250
15 6 90
5 4 20

∑ f = 60 ∑ fX = 2100
By direct method,

X =
∑ fX
∑f
2100
= = 35 marks
60
Example 4: (Mean in discrete series by short-cut method) Compute the mean
from the following data:
X: 9.5 8.5 7.5 6.5 5.5 4.5 3.5
f: 8 32 85 60 22 7 3
Para 4.4 measures of central tendency 68

Solution:
Computation of Mean by Short-cut method

X f d= X – A =X – 6.5 fd
9.5 8 3 24
8.5 32 2 64
7.5 85 1 85
6.5 60 0 0
5.5 22 1 22
4.5 7 2 14
3.5 3 3 9

∑ f = 217 ∑ fd = 128
By short-cut method,

X =A+
∑ fd , d =X - A
∑f
128
= 6.5 +
217
= 6.5 + 0.589 = 7.089
Example 5: (Mean in continuous series by direct method): Compute the mean
from the data given below:

X f
0-10 4
10-20 6
20-30 10
30-40 20
40-50 10
Solution:
Computation of Mean by direct method

X f Mid value(m) fm
0-10 4 5 20
10-20 6 15 90
20-30 10 25 250
30-40 20 35 700
40-50 10 45 450

∑ f = 50 ∑ fm = 1510
69 Various measures of central Tendency Para 4.4

By direct method,

X =
∑ fm
∑f
1510
= = 30.2
50
Example 6: (Mean in continuous series by step deviation method) Compute the
mean wages of the workers from the data given below:

Wages (in `) No. of workers

40-60 10
60-80 15
80-100 28
100-120 32
120-140 20
140-160 10
160-180 8
180-200 5
Solution :
Computation of Mean wages

Wages (X) No. of Mid-value(m) m −A fu

workers(f) u=
i
m − 110
=
20
40-60 10 50 -3 -30
60-80 15 70 -2 -30
80-100 28 90 -1 -28
100-120 32 110 0 0
120-140 20 130 1 20
140-160 10 150 2 20
160-180 8 170 3 24
180-200 5 190 4 20

∑ f =128 ∑ fu = -4
By step deviation method,

X =A+
∑ fu × i , where u= m − A = m − 110
∑f i 20
Para 4.4 measures of central tendency 70

4
= 110 − × 20
128

1510
=
50
Therefore, mean age = ` 109.375

Example 7: (Mean in continuous series) The following table gives the income of
employees of a company. Compute the mean income.

Income (in thousand rupees) No. of employees

Less than 20 5
Less than 30 22
Less than 40 48
Less than 50 60
Less than 60 83
Less than 70 100
Solution:
Computation of Mean income
Income Class No. of Mid- m −A fu
intervals(X) employees (f) value(m) u=
i
m − 45
=
10
Less than 20 10-20 5 15 -3 -15
Less than 30 20-30 22-5 = 17 25 -2 -34
Less than 40 30-40 48-22 = 26 35 -1 -26
Less than 50 40-50 60-48 = 12 45 0 0
Less than 60 50-60 83-60 = 23 55 1 23
Less than 70 60-70 100-83 = 17 65 2 34

∑ f =100 ∑ fu = -18
By step deviation method,

X =A+
∑ fu × i , where u= m − A = m − 45
∑f i 10

18
= 45 − × 10
100
= 43.2
Therefore, mean income = ` 43.2 thousand
71 Various measures of central Tendency Para 4.4

Example 8: (Mean in continuous series) The following table gives the profit earned
by various companies from the sale of coffee. Compute the average profit earned.

Profit (in crores of rupees) No. of companies

More than 0 150
More than 10 140
More than 20 100
More than 30 80
More than 40 80
More than 50 70
More than 60 30
More than 70 14
Solution:
Computation of Mean Profit
Profit Class No. of Mid- m −A fu
intervals(X) Companies value(m) u=
(f) i
m − 35
=
10
More than 0 0-10 150-140 =10 5 -3 -30
More than 10 10-20 140-100 =40 15 -2 -80
More than 20 20-30 100-80 =20 25 -1 -20
More than 30 30-40 80-80 = 0 35 0 0
More than 40 40-50 80-70 =10 45 1 10
More than 50 50-60 70-30 =40 55 2 80
More than 60 60-70 30-14 =16 65 3 48
More than 70 70-80 14 75 4 56

∑ f = 150 ∑ fu = 64
By step deviation method,

X =A+
∑ fu × i , where u= m − A = m − 35
∑f i 10
64
= 35 + × 10
150
= 39.27
Therefore, mean profit = ` 39.27 crores.

Example 9: (Correcting mean) The mean of 100 items was 40. Later, it was discovered
that two items 3 and 72 were wrongly taken as 30 and 27. Find the correct mean.
Para 4.4 measures of central tendency 72

Solution: We are given that n = 100, mean = 40, wrong items = 30, 27; correct
items = 3, 72

We know that X =
∑X
n

⇒ 40 =
∑X
100
⇒ ∑ X = 4000
corr ∑ X = 4000 − wrong items + correct items
= 4000 - 30 - 27 + 3 + 72 = 4018
corr ∑ X
corr X =
n
4018
= = 40.18
100
Example10: (Combined Mean) A distribution consists of three components with
total frequencies of 200, 250 and 300 having means 25, 10 and 15 respectively.
Find mean of combined distribution.
Solution: We are given that N 1 = 200, X 1 = 25, N 2 = 250, X 2 = 10, N 3 = 300, X 3 = 15

N 1X 1 + N 2 X 2 + N 3X 3
Combined mean = X 123 =
N1 + N 2 + N 3
200(25) + 250(10) + 300(15)
=
200 + 250 + 300
5000 + 2500 + 4500
= = 16
750
Therefore, combined mean = 16

Example 11: (Combined Mean): 100 students appeared in an examination. The

results of 30 students who failed are given below:

Marks: 5 10 15 20 25 30
No. of students: 3 7 8 7 3 2
If the average marks of all students were 60, find out average marks of those
who passed.
73 Various measures of central Tendency Para 4.4

Solution: We first find the mean of 30 students who failed.

Marks (X) No. of students (f) fX

5 3 15
10 7 70
15 8 120
20 7 140
25 3 75
30 2 60
Total 30 480

X =
∑ fX =
480
= 16
∑f 30
Let 1st group be the group of students who passed then N 1 = 70, X 1 = ?
Let 2nd group be the group of students who failed then N 2 = 30, X 2 = 16
Also combined mean = X 12 = 60, N 1 + N 2 = 100
N 1X 1 + N 2 X 2
Combined mean = X 12 =
N1 + N 2

70(X 1 ) + 30(16)
60 =
100

⇒ X 1 = 78.86

Therefore, average marks of all students who passed is 78.86

4.4.2 Weighted Arithmetic Mean
The term ‘weight’ refers to the relative importance of different items. While
calculating simple arithmetic mean, all items are given equal importance. But
there are cases where the relative importance of different items is not same.
In such cases, we compute weighted arithmetic mean. It is denoted by X
w
and is given by

Xw =
∑WX
∑W
where W is weight and X denotes given observations.
Para 4.4 measures of central tendency 74

Example 12: (Weighted Mean) The following table presents the result of students
in two colleges X and Y.

Examination College X College X College Y College Y

No. of students Pass% No. of students Pass%
(in hundred) (in hundreds)
M.A 4 83 3 76
M.Com 3 71 6 73
B.A 2 74 2 82
B.Com 5 73 7 76
B.Sc 3 66 3 65
M.Sc 3 65 7 60
Comment on the performance of the students of two colleges by simple and
weighted means.
Solution:
Computation of Simple and Weighted Mean of College X

Examination Pass% (X) W WX

M.A 83 4 332
M.Com 71 3 213
B.A 74 2 148
B.Com 73 5 365
B.Sc 66 3 198
M.Sc 65 3 195

∑W = 20 ∑WX = 1451
X =
∑X =
432
= 72
N 6

Xw =
∑WX 1451
= = 72.55
∑W 20
75 Various measures of central Tendency Para 4.4

Computation of Simple and Weighted Mean of College Y

Examination Pass%(X) No. of students (W) WX

M.A 76 3 228
M.Com 73 6 438
B.A 82 2 164
B.Com 76 7 532
B.Sc 65 3 195
M.Sc 60 7 420

∑ X = 432 ∑W = 28 ∑WX = 1977

X =
∑X =
432
= 72
N 6

∑WX 1977
Xw = = = 70.61
∑W 28
On comparing weighted arithmetic mean, we see that for college X , the mean value
is higher. Hence, we can say that performance of students is better in college X.

4.4.3 MEDIAN
Median refers to the middle value of the distribution. It is a positional average.
Computation of Median in different cases:
(i) In case of individual observations:
(a) Arrange the given data in ascending or descending order of magnitude.
(b) Count the number of observations. Let it be denoted by n.
(c) If n is even then median is given by
th th
n  n 
size of   item + size of  + 1 item
2 2
Med =   
2 th
 n +1
If n is odd then median is given by Med = size of  item
 2 

(ii) Case of discrete series:
(a) Arrange the given data in ascending or descending order of magnitude.
(b) Compute the cumulative frequencies (c.f)
n +1
(c) Calculate . Look this value in the c.f column and find the total
2 n +1
which is either equal to or next higher to it. Determine the
2
corresponding value of the variable. This is median.
Para 4.4 measures of central tendency 76

(iii) In case of grouped data or continuous series:

(a) Compute the cumulative frequencies (c.f)

(b) Calculate n . Look this value in the c.f column and find the total which
2
n
is either equal to or next higher to it. Determine the corresponding
2
class interval. This is median class.
n
−c
(c) Apply the formula :
Med = l + 2 ×h
f

where l = lower limit of the median class, h = class size

f = frequency of the median class.
c = frequency of the class preceding to the median class.
(iv) In case of unequal class intervals: Since median is a positional average,
there is no need to adjust the frequencies to make the class intervals
equal. One can compute the median as usual.
(v) In case of open-end distributions: Median is the most suitable average in
case of open-end distributions as median is a positional average. There is
no need to make assumptions for the lower limit of the first class-interval
and upper limit of the last class-interval as median always lies in the middle
of the distribution.
Merits of median
1. Median is a very useful measure of central tendency in case of open-end
distribution since it is a positional average.
2. It is easy to compute in case of unequal class intervals.
3. It is not strongly affected by extreme observations.
4. It can be located graphically.
Demerits of median
1. It is necessary to arrange data but other averages do not any arrangement.
2. It is not capable of further algebraic treatment.
3. It does not take into account each and every observation. It is not based
on all the observations.
4. It is affected by fluctuations in sampling.
5. It is erratic if the number of items is less.
77 Various measures of central Tendency Para 4.4

Example 13: (Median in individual observations) Compute median marks of the

following data:
25, 27, 37, 35, 28, 30, 38, 32, 33
Solution: Arranging the given data in ascending order we get,
25, 27, 28, 30, 32, 33, 35, 37, 38
n = 9 (odd)
th
n +1
Med = size of   items
 2 
th
 9 +1
= size of   item
 2 
= size of 5th item
= 32.
Therefore median marks= 32

Example 14: ( Median in individual observations) Compute median of the following

data:
1000, 1200, 900, 1500, 1400, 2000, 1800, 1700
Solution: Arranging the given data in ascending order we get,
900, 1000, 1200, 1400, 1500, 1700, 1800, 2000
n = 8 (even)
th th
n  n 
size of   item + size of  + 1 item
Med = 2 2 
2
th th
8 8 
size of   item + size of  + 1 item
2 2 
=
2
th th
size of 4 item + size of 5 item 1400 + 1500
= = = 1450
2 2
Therefore, median = 1450

Example 15: (Median in discrete series) Compute median from the following series.

X: 10 14 13 11 12
f: 3 3 12 12 18
Solution: We first arrange X in ascending order and write the corresponding
frequency as shown below.
Para 4.4 measures of central tendency 78

Computation of Median

X f c.f
10 3 3
11 12 15
12 18 33
13 12 45
14 3 48
n = 48
n + 1 48 + 1
= = 24.5
2 2
Look 24.5 or next higher to it in the c.f column. The value 33 is next higher to
24.5 . Value of X corresponding to 33 is 12. Therefore median = 12.

Example 16: (Median in continuous series with inclusive class intervals) Compute
median from the data given below:

Wages per week (in ₹) No. of workers

50-59 15
60-69 40
70-79 50
80-89 60
90-99 45
100-109 40
110-119 15
Solution : We first make the class intervals exclusive by subtracting 0.5 from
the lower limit of each class interval and adding 0.5 to the upper limit of each
class interval.
Computation of Median

Wages per week Class interval No. of workers(f) c.f

50-59 49.5-59.5 15 15
60-69 59.5-69.5 40 55
70-79 69.5-79.5 50 105
80-89 79.5-89.5 60 165
90-99 89.5-99.5 45 210
100-109 99.5-109.5 40 250
110-119 109.5-119.5 15 265
n= 265
79 Various measures of central Tendency Para 4.4

n 265
= = 132.5 nn
2 2
Look for this value in the c.f column, we get the median class as 79.5 – 89.5

Med = l + ×h

132.5 − 105
= 79.5 + × 10
60
= 79.5 + 4.6 = 84.1
Therefore, median = ` 84.1

Example 17: (Median in case of open-end distribution) Compute the appropriate

measure of central tendency in the following data.

Monthly Income (`) No. of families

Below 100 50
100-200 500
200-300 555
300-400 100
400-500 3
Above 500 2
Solution: Median is the most suitable average in case of open-end distributions
where the lower limit of the first class interval and upper limit of the last class
interval is not known. Therefore, median is the most appropriate measure of
central tendency in given data.
Computation of Median

Monthly income(X) f c.f

Below 100 50 50
100-200 500 550
200-300 555 1105
300-400 100 1205
400-500 3 1208
Above 500 2 1210

n= 1210
n 1210
= 605

=
2 2 nn
Para 4.4 measures of central tendency 80

Look for this value in the c.f column, we get the median class as 200-300
n
−c
Med = l + 2 ×h
f
605 − 550
= 200 + × 100
555
= 200 + 9.9 = 209.9
Therefore, median = ` 209.9
Example 18: (Median in continuous series) Compute median in the data given below:

Marks No. of students

More than 40 186
More than 50 167
More than 60 132
More than 70 84
More than 80 38
More than 90 12
Solution: We first make the class intervals continuous by adjusting the frequencies
as shown below.
Computation of median
Marks No. of students Class intervals No. of students c.f
More than 40 186 40-50 186-167 = 19 19
More than 50 167 50-60 167-132 = 35 54
More than 60 132 60-70 132-84 = 48 102
More than 70 84 70-80 84-38 = 46 148
More than 80 38 80-90 38-12=26 174
More than 90 12 90-100 12 186
n= 186
n 186
= = 93
2 2
Look for this value in the c.f column, we get the median class as 60-70
n
−c
Med = l + 2 ×h
f
93 − 54
= 60 + × 10
48
= 60 + 8.125 = 68.125
Therefore, median = 40
81 Various measures of central Tendency Para 4.4

Example 19: (Median in case of unequal class intervals) Compute median from
the data given below.

Marks No. of students

0-10 8
10-20 10
20-40 22
40-60 25
60-80 10
80-100 5
Solution: Since median is a positional average, there is no need to adjust the
frequencies to make the class inrevals equal.
Computation of median

Marks No. of students(f) c.f

0-10 8 8
10-20 10 18
20-40 22 40
40-60 25 65
60-80 10 75
80-100 5 80
n = 80
n 80
= = 40
2 2

Look for this value in the c.f column, we get the median class as 20-40
n
−c
Med = l + 2 ×h
f
40 − 18
= 20 + × 20
22
= 20 + 20 = 40
Therefore, median = 40

Example 20: (Missing frequency) Find the missing frequency from the following
data if median = 35 and N = 170
Para 4.4 measures of central tendency 82

Variable Frequency
0-10 10
10-20 20
20-30 -
30-40 40
40-50 -
50-60 25
60-70 15
Solution: Let the missing frequency corresponding to class 20-30 and 40-50 be
x and y respectively.
Then 10 +20 + x +40 + y +25 +15 = 170
⇒ x +y = 60
Determination of missing frequency

Variable Frequency c.f

0-10 10 10
10-20 20 30
20-30 x 30 + x
30-40 40 70 + x
40-50 y 70 + x + y
50-60 25 95 + x + y
60-70 15 110 + x + y
n = 170
n 170
= = 85
2 2
Since median is 35 which lies in class interval 30 – 40, therefore median class
is 30 -40.
Then f = 40, h = 10, c = 30 + x
n
−c
Med = l + 2 ×h
f
85 − (30 + x )
⇒ 35=30+ × 10
40
55 − x
⇒ 35 − 30 =
4
⇒ x = 35
Therefore y = 60 – 35 = 25. Hence the missing frequencies are 35, 25
83 Various measures of central Tendency Para 4.4

4.4.4 GRAPHICAL METHOD OF DETERMINING MEDIAN

Median can be determined graphically by any of the following two methods.
1. Draw two ogives by the following methods:
(a) Less than ogive: In the “less than ogive” method, we start with the
upper limit of the classes and go on adding the frequencies. This is
called “ less than c.f”. Now plot these frequencies with the upper limit
of each class interval. The curve so obtained is a rising curve and is
called “ less than ogive”.
(b) More than ogive: In the “more than ogive method”, we start with the
lower limit of the classes and more than cf of each class. Now plot
these frequencies with the lower limit of each class interval. The curve
so obtained is a declining curve and is called “ more than ogive”.
Now, find the point of intersection of the two ogives. From this point, draw
a perpendicular on X axis. The foot of perpendicular will be the value of
median.
2. Draw only one ogive by “ less than ogive method”. Take the variable on
X axis and frequency on Y axis. Find median= size of (n/2)th item. Now
locate this value of Y axis . From this point, draw a perpendicular on
the c.f curve. From the point where it meets the ogive, draw another
perpendicular on the X axis and the point where it meets the X axis is
the median.
Example21: Determine the median in the following data graphically by drawing
two ogives.
Daily wages (`) No. of workers
0-10 3
10-20 9
20-30 15
30-40 30
40-50 18
50-60 5
Solution:

Class interval Frequency(f) c.f (less than) c.f (more than)

0-10 3 3 80
10-20 9 12 77
20-30 15 27 68
30-40 30 57 53
40-50 18 75 23
50-60 5 80 5
Para 4.4 measures of central tendency 84

Now plot the less than c.f values with the upper limit of each class interval.
This gives the less than ogive. Then we plot the more than c.f values with the
lower limit of each class interval. This gives more than ogive. Then the point
of intersection of these two ogives will give us the median. From the graph. It
is clear that median is 34.3
Y
90

80

70

60
OGIVE (Less than)
No. of Workers

50

40

30 OGIVE (More than)

20
Median
10

X
0
10 20 30 40 50 60 70 80 90

Daily Wages (Rs.)

Fig. 9.4 : Graphical determination of median.
Example22: Determine the median in the following data graphically by drawing
two ogives
Marks: 10-20 20-30 30-40 40-50 50-60 60-70 70-80 80-90 90-100
No. of 6 8 12 18 25 16 8 5 2
students:
Solution:
Class interval Frequency(f) c.f (less than) c.f (more than)
10-20 6 6 100
20-30 8 14 94
30-40 12 26 86
40-50 18 44 74
50-60 25 69 56
60-70 16 85 31
70-80 8 93 15
80-90 5 98 7
90-100 2 100 2
85 Various measures of central Tendency Para 4.4

100 Less than ogive

90

80

70

60
No. of students

50

40

30

20

10

0 10 20 30 40 50 60 70 80 90 100
Marks
Fig. 9.1
From the graph, it is clear that median = 52.5
Example 23: Calculate the median marks in the following data by drawing
less than ogive.
Marks: 0-5 5-10 10-20 20-30 30-40 40-60
No. of students: 5 7 15 20 8 5
Solution:
We first calculate the less than cf.

Marks No. of students

Less than 5 5
Less than 10 12
Less than 20 27
Less than 30 47
Less than 40 55
Less than 60 60
Median = size of (n/2)th item = (60/2) = 30th item
Para 4.4 measures of central tendency 86

60 (60,60)

(40,55)
50
(30,47)
40
no. of Students

30
(20,27)

20
.5

10
21

(10,12)
=
n

(5,5)
ia
ed
M

X
60 10 20 30 40 50 60

Marks
Fig. 9.3
Locate 30 on Y axis and draw perpendicular on less than ogive curve. Then
draw the perpendicular from this point on X axis. The corresponding value of
X is median. From graph, Med = 21.5

4.4.5 MODE
Definition: Mode is that value of the variable which occurs with the maximum
frequency and around which the other items of the series are more closely
concentrated.
Computation of Mode in different cases:
(i) In case of individual observations: Mode can be determined by counting
the number of times, the various values repeat themselves and then the
value occurring maximum number of times is the modal value.
(ii) In case of discrete series: Mode can be determined in the following two
ways in case of discrete series.
(a) By inspection: If the distribution is fairly regular, we look at the
highest frequency or the value around which the other items of the
set are more closely concentrated. Then, find the value of the variable
corresponding to it. This is mode.
87 Various measures of central Tendency Para 4.4

(b) By grouping: In this method, we form a grouping table as follows

which consists of six columns:
(i) The column of frequency is marked as column no. 1. Mark
the maximum frequency in column 1.
(ii) In column 2, add the frequencies in group of two’s and then
mark the highest total in column 2.
(iii) In column 3, leave the first frequency and then add the
frequencies in group of two’s. Now, mark the highest total in
column 3.
(iv) In column 4, group the frequencies in three’s and again mark
the highest total.
(v) In column 5, leave the first frequency and group the frequencies
in three’s and mark the highest total in that column.
(vi) In column 6, leave the first two frequencies and then group
the remaining in three’s and mark the highest total.
After grouping, another table is formed called analysis table. For this,
we write column number one to six row wise and various values of X
along the columns. The values against which the highest frequencies are
marked in the grouping table are entered by putting 1 in the relevant
box corresponding to the values they represent. Now the value having
maximum number of 1’s is the mode.
(iii) In case of continuous series:
(a) Modal class: Determine the modal class either by inspection or by
grouping.
∆1
(b) Apply the formula: Mode = l + ×h
∆1 + ∆ 2
where ∆1 = fm − f1 and ∆ 2 = fm − f2
l = lower limit of the modal class, h = class size,
fm = frequency of the modal class
f1 = frequency of the class preceding to the modal class
f2 = frequency of the class succeeding to the modal class.
(iv) Empirical relationship between mean, median and mode: Sometimes,
there are two values which occur with equal frequencies. The distribution
is then called bimodal and mode is said to be ill-defined. In such cases,
we calculate empirical mode given by Mode = 3 median – 2 mean
(v) In asymmetrical distribution or moderately skewed distribution: In this
case, empirical mode is calculated using the formula Mode = 3 median - 2
mean.
Para 4.4 measures of central tendency 88

(vi) In case of unequal class interval: If the class intervals are not equal in size,
then there is a need to make them equal by adjusting the frequencies on
the assumption that they are equally distributed throughout the class.
Graphical Determination of Mode:
To find the mode graphically, we perform the following steps.
1. Draw a histogram from the given data.
2. Draw two lines diagonally in the inside of modal class bar, starting from
each upper corner of the bar to the upper corner of the adjacent bar.
3. Draw a perpendicular line from the intersection of the two diagonal lines
to the x axis which gives us the modal value.
Merits of mode:
(i) It is simple to calculate and easy to understand. In some cases, it can be
located merely by inspection.
(ii) Mode is that value which represents the whole distribution.
(iii) It can be located graphically by a histogram.
(iv) It is not at all affected by extreme observations.
(v) It can be used to describe qualitative phenomenon.
(vi) It is also a useful measure of central tendency in case of open-end
distributions.
Demerits of mode:
(i) Mode is not rigidly defined. It is ill defined in case of bimodal series i.e.,
if the maximum frequency is repeated.
(ii) It is not based on each and every observation of the given set of data.
(iii) Mode is affected to a greater extent by the fluctuations in sampling.
(iv) it is not capable of further algebraic treatment.
Example24: (Mode in individual observations) Compute mode from the following
data:
10, 12, 10, 13, 14, 10, 12, 15, 10, 13
Solution :
Computation of Mode

Values (X) No. of times it occurs

10 4
12 2
13 2
14 1
15 1
Total = 10
89 Various measures of central Tendency Para 4.4

The value 10 is occurring maximum number of times, therefore mode = 10

Example25: (Mode in discrete series) Compute mode from the data given below:

X: 53 76 45 64 42 70 60 50
F: 8 10 15 25 40 20 15 7
Solution: We first form grouping table.
Grouping Table
X F (column 1) Column 2 Column 3 Column 4 Column 5 Column 6
53 8
8 +10 =18
76 10 8+10+15 =33
10 +15 = 25
45 15 10+15+25=50
15 +25 = 40
64 25 15+25+40=80
25 +40 = 65
42 40 25+40+20=85
40 +20 = 60
70 20 40+20+15=75
20 +15 =35
60 15 15 +7 = 22 20+15+7=42

50 7
Note: The values which are bold and underlined show the highest frequency
in each column.
Analysis table

Col. No. X 53 76 45 64 42 70 60 50
1 1
2 1 1
3 1 1
4 1 1 1
5 1 1 1
6 1 1 1
Total 0 0 1 3 6 3 1 0
It is clear from the analysis table that mode = 42
Para 4.4 measures of central tendency 90

Example26: (Mode in continuous series) Compute mode from the data given below:

Class intervals frequency

0-20 4
20-40 26
40-60 22
60-80 10
80-100 9
100-120 6
120-140 3
Solution: As the distribution is not fairly regular, we determine the modal class
by grouping method.
Grouping Table
X F (column 1) Column 2 Column 3 Column 4 Column 5 Column 6
0-20 4
4 +26 =30
20-40 26 4+26+22 =52
26 +22 = 48
40-60 22 26+22+10=58
22 +10 = 32
60-80 10 22+10+9=41
10 +9 = 19
80-100 9 10+9+6=25
9 +6 = 15
100-120 6 9+6+3=18
6 +3 =9
120-140 3

Note: The values which are bold and underlined show the highest frequency
in each column.
Analysis table

Col. No. X 0-20 20-40 40-60 60-80 80-100 100-120 120-140

1 1
2 1 1
3 1 1
4 1 1 1
5 1 1 1
6 1 1 1
Total 1 4 5 3 1 0 0
91 Various measures of central Tendency Para 4.4

It is clear from the analysis table that modal class is 40 – 60.Therefore, l= 40,
h = 20, fm = 22, f1 = 26, f2 = 10
∆1 = fm − f1 = 22 − 26 =4
∆ 2 = fm − f2 = 22 − 10 = 12
∆1
Mode = l + ×h
∆1 + ∆ 2
4
= 40 + × 20
4 + 12
= 40 + 5 =45
Therefore, Mode is 45

Example27: (Emperical mode or Mode in case of bi-modal series): The following

data gives the daily wages of 122 workers of a factory. Determine the modal
wages.

Wages (in `) No. of workers

100-110 4
110-120 6
120-130 20
130-140 32
140-150 33
150-160 17
160-170 8
170-180 2
Solution: As the distribution is not fairly regular, we determine the modal class
by grouping method.
Para 4.4 measures of central tendency 92

Grouping Table
X F (column Column 2 Column 3 Column 4 Column 5 Column 6
1)
100-110 4
4 +6 =10
110-120 6 4+6+20 =30
6 +20 = 26
120-130 20 6+20+32=58
20 +32 = 52
130-140 32 22+32+33=85
32 +33 = 65
140-150 33 32+33+17=82
33 +17 = 50
150-160 17 33+17+8=58
17 +8 =25
160-170 8 17+8+2=27
8+2 =10
170-180 2

Note: The values which are bold and underlined show the highest frequency
in each column.
Analysis table
Col. No. X 100-110 110-120 120-130 130-140 140-150 150-160 160-170 170-180
1 1
2 1 1
3 1 1
4 1 1 1
5 1 1 1 1 1 1
6 1 1 1
Total 0 1 3 5 5 2 1 0

It is clear from the analysis table that it is a bimodal series. So, we calculate
empirical mode.
93 Various measures of central Tendency Para 4.4

Computation of mean and median

Wages No. of workers(f) Mid value (m) fm c.f

100-110 4 102 408 4
110-120 6 115 690 10
120-130 20 125 2500 30
130-140 32 135 4320 62
140-150 33 145 4785 95
150-160 17 155 2635 112
160-170 8 165 1320 120
170-180 2 175 350 122
N = 122 ∑ fm =
16908
Mean:

X =
∑ fm =
16908
= 138.59
∑f 122

Median:
N 122
= = 61 . Look this value or next higher to it in the c.f column, we get the
2 2
median class as 130-140
N
−c
Med = l + 2 ×h
f
61 − 30
= 130 + × 10 = 139.69
32
Now, Mode = 3 median – 2 mean
= 3(139.69) – 2(139.51) = 140.05

Example28: (Mode in case of unequal class intervals)

Wages(in ‘000 `): 0-10 10-20 20-40 40-50 50-70

No. of workers: 5 12 40 32 28
Solution: Since the class interval are not equal in size, we first make them equal
by adjusting the frequencies.
Para 4.4 measures of central tendency 94

Wages No. of workers

0-10 5
10-20 12
20-30 20
30-40 20
40-50 32
50-60 14
60-70 14
By grouping method, we can determine that the modal class is 40-50.
∆1 = fm − f1 = 32 − 20 =12
∆ 2 = fm − f2 = 32 − 14 = 18
∆1
Mode = l + ×h
∆1 + ∆ 2
12
= 40 + × 10 = 44
12 + 18
Therefore, Mode = 44

Example29: (Mode in asymmetrical or moderately skewed distribution) In a

moderately skewed distribution or an asymmetrical distribution, median =
20.6 and mean = 17.9. Find mode.
Solution: By empirical mode, we have Mode = 3 median – 2 mean
Mode = 3(20.6) – 2(17.9) = 26

Example30: Determine mode graphically.

Class interval: 0-20 20-40 40-60 60-80 80-100 100-120 120-140

Frequency: 8 12 36 35 45 30 10
95 Objective type questions

Solution: First we draw the histogram from the given data.

45
45
40
36 35
35
30
30
frequency

25
20

15 12 10
10 8

0 20 40 60 80 100 120 140

Variable
Fig. 9.6 : Graphical determination of mode
It is clear from the histogram that mode is 88.

OBJECTIVE TYPE QUESTIONS

Q1. While calculating mean from grouped data, an implicit assumptions is:
(a) Each value in a class is equal to the mid-point.
(b) All values are discrete.
(c) No value is repeated in the data set.
(d) The number of the frequency in each class is the same.
Q2. The sum of the deviations taken from A.M is
(a) Maximum (b) Minimum (c) Zero (d) none
Q3. The sum of the squares of deviations taken from A.M is
(a) Maximum (b) Minimum (c) Zero (d) none
Q4. The first step while calculating median of a data set is
(a) Arrange the data in ascending or descending order.
(b) Calculate the mean of the middle two items in the data set.
(c) Determine the relative weights of the data values in terms of importance.
(d) None of the above.
Q5. Which of the following statements is not correct?
(a) Some data sets do not have mean.
 measures of central tendency 96

(b) Extreme values in the data affect the mean.

(c) Mean is a measure of central tendency.
(d) At times, weighted mean is much better than the simple arithmetic
mean.
Q6. For the given data set 7, 8, 9, 9, 17, mean is:
(a) 10 (b) 50
(c) can not be calculated (d) none
Q7. For the given data set 7, 8, 9, 9, 17, median is:
(a) 10 (b) 9 (c) 3 (d) none
Q8. For the given data set 7, 8, 9, 9 and 17
(a) Mean is greater than median
(b) Mode is greater than mean
(c) Median is greater than mode
(d) Mean = median = mode
Q9. Suppose a student scores 30 marks in internal assessment, 25 marks in practical
exam and 20 marks in final. Weights assigned to these three tests are 2,3,5.
Then the weighted mean is:
(a) 25 (b) 23.5 (c) 23 (d) none
Q10. The mean height of 25 male workers in a factory is 61 inches and that of female
workers is 58 inches. Then the combined mean height of 60 workers in inches
is:
(a) 59.25 (b) 59 (c) 41.5 (d) none
Q11. If the balance in savings bank account of nine households in rupees are:
745, 2000, 1500, 68000, 461, 549, 3750, 1800, 4795
The average balance per household is:
(a) 9289 (b) 1800 (c) 9000 (d) none
Q12. If the balance in savings bank account of nine households in rupees are:
745, 2000, 1500, 68000, 461, 549, 3750, 1800, 4795
Median of the above data is:
(a) 9289 (b) 1800 (c) 9000 (d) none

Q13. If the mean of a set of observations x1 , x 2 ,.........x n is X then the mean of the
observations x i + 2i;i = 1, 2,.........n is
(a) X + 2 (b) X + 2n (c) X + n + 1 (d) X + n
Q14. The mean of a set of numbers is X . If each number is divided by 3 then the
new mean is:
(a) X (b) X / 3 (c) X + 3 (d) 3 X
97 Objective type questions

Q15. The mean of a set of numbers is X . If 3 is added to each number then the
new mean is:
(a) X (b) X / 3 (c) X + 3 (d) 3 X
Q16. The mean of a set of numbers is X . If 3 is subtracted to each number then
the new mean is:
(a) X (b) X / 3 (c) X − 3 (d) 3 X
Q17. X: 3.5 4.5 5.5 6.5 7.5 8.5 9.5
f: 3 7 22 60 85 32 8
The mean of the above data is:
(a) 7.089 (b) 24.78 (c) 6.5 (d) none
Q18. X: 20-25 25-30 30-35 35-40 40-45 45-50
F: 170 110 80 45 40 35
The mean of the above data is:
(a) 30 (b) 30.21 (c) 32.5 (d) none

Q19. Marks: 0-10 10-20 20-30 30-40 40-50

No. of students: 7 6 15 12 10

The mean of the above data is :
(a) 27.4 (b) 1370 (c) 274 (d) none
Q20. The mean of the first three terms of a series is 14 and mean of next 2 terms is
18. Then the mean of all 5 terms is:
(a) 18 (b) 15.6
(c) data is insufficient (d) none
Q21. The mean of 10 observations were found to be 1670. Later on it was discovered
that one item 1950 was wrongly taken as 2000. Then the correct mean
corresponding to correct score is:
(a) 1670 (b) 1665 (c) 1470 (d) none
Q22. The daily sales of a departmental store were ` 2750 for Feb 2015. During the
month, the highest and lowest sales were ` 8950 and ` 580 respectively. Then
the average daily sale when lowest and highest sales are not taken into account
is:
(a) 2750 (b) 2595 (c) 2249 (d) none
Q23. The mean annual salaries paid to 10 male employees of a factory was ` 2000
while the mean annual salaries paid to 20 female employees of the same
factory was ` 1500. Then the overall average salaries paid to all employees of
the factory are:
(a) 1666.66 (b) 116.67 (c) 3500 (d) none
 measures of central tendency 98

Q24. The mean wages paid to all workers of a factory was ` 5000. The mean wages
paid to male and female workers were ` 5200 and ` 4200 respectively. The
percentage of male and female workers employed by the factory is
(a) 80%, 20% (b) 20%, 80% (c) 60%, 40% (d) 40%, 60%
Q25. The mean age of a combined group of men and women is 30 years. If the
mean age of mean is 32 and that of women is 27, then the percentage of men
and women in that group is
(a) 80%, 20% (b) 20%, 80% (c) 60%, 40% (d) 40%, 60%
Q26. B.Com III year has three sections A, B and C with 50, 40 and 60 students
respectively. The mean marks obtained in the three sections were 85, 60, 65
respectively. Later on it was discovered that marks of a student of section
A was wrongly recorded as 50 instead of zero. Mean marks of all the three
sections taken together is:
(a) 70 (b) 80 (c) 90 (d) none
Q27. X Ltd. Has 5 plants producing PVC pipes. The mean monthly production of
4 plants for 1982 was 73,000 feet and that of fifth plant was 85000 feet. Then
the average production of the five plants in feet is:
(a) 75500 (b) 75400 (c) 70000 (d) none
Q28. A factory employs 100 workers of whom 60 works in first shift and 40 works
in second shift. The average wage of all the 100 workers is ` 38. If the average
wage of 60 workers of first shift is ` 40, then the average wages of the remaining
40 workers of the second shift are
(a) 35 (b) 40 (c) 45 (d) none

Q29. Roll no. 1 2 3 4 5 6 7 8 9 10

No. of students: 43 60 37 48 65 48 57 78 31 59
Mean marks are:
(a) 52.6 (b) 52 (c) 42 (d) none

Q30. Marks: 5 15 25 35 45 55 65
No. of students: 4 6 10 20 10 6 4
Mean marks of the data given above is:
(a) 60 (b) 35 (c) 25 (d) none
Q31. Find the missing frequency from the data given below if mean = 46

Variable: 10-20 20-30 30-40 40-50 50-60 60-70 70-80 80-90

Frequency: 4 12 40 - 27 13 9 4
(a) 91 (b) 19 (c) 46 (d) none
Q32. The weighted arithmetic mean of the first n natural numbers whose weights
are equal to the corresponding numbers is:
99 Objective type questions

n +1 2n + 1 2(n + 1)
(a) (b) (c) (d) none
3 3 3
Q33. A candidate obtained the following percentage of marks in different subjects
in the Half-yearly examination: English : 46%; statistics : 67%; Accounts: 72%;
Economics: 58%; Income tax: 53%. It is agreed to give double weights to marks
in English and statistics as compare to other subjects. What is simple and
weighted mean?
(a) 59.2%, 58.43% (b) 58.43%, 59.2%
(c) both are same (d) none
Q34. Median of the data: 391, 384, 591, 407, 672, 522, 777, 753, 2488, 1490 is :
(a) 672 (b) 631.5 (c) 631 (d) none
Q35. Median from the given data: 1200, 1000, 900, 1400 and 1500 is
(a) 1200 (b) 900 (c) 1300 (d) none
Q36. Median of the data: 100, 105, 90, 95, 70 and 102 is :
(a) 92.5 (b) 97.5 (c) 90 (d) 95

Q37. X: 100 150 80 200 250 180

F: 24 26 16 20 6 30
Median of the above series is:
(a) 150 (b) 80 (c) 140 (d) none

Q38. Marks: 0-25 25-50 50-75 75-100

No. of students: 30 50 80 40
(a) 56 (b) 56.25 (c) 57 (d) none

Q39. Marks (Less than): 10 20 30 40 50 60 70 80

No. of students: 4 16 40 76 96 112 120 125
(a) 36 (b) 36.75 (c) 36.25 (d) none

Q40. Mid value: 115 125 135 145 155 165 175 185 195
Frequency: 6 25 48 72 116 60 38 22 3

(a) 153 (b) 153.79 (c) 154 (d) 155

Q41. Find the missing frequency in the following distribution if N = 100 and median
= 30

Marks: 0-10 10-20 20-30 30-40 40-50 50-60

No. of students: 10 - 25 30 - 10

(a) 10,15 (b) 15,10 (c) 15,14 (d) none

 measures of central tendency 100

Q42. Find median from the data given below.

X: 0-10 10-30 30-60 60-80 80-90

F: 5 15 30 8 2
(a) 40 (b) 50 (c) 60 (d) none
Q43. Compute modal marks from the given data: 10, 27, 24, 12, 27, 27, 20, 18, 15, 30
(a) 3 (b) 27 (c) 30 (d) none
Q44. Find the mode from the following data:
X: 58 60 61 62 63 64 65 66 68 70
F: 4 6 5 10 20 22 24 6 2 1
(a) 64 (b) 63 (c) 62 (d) 65
Q45. In an asymmetrical distribution, mode = 32.1 mean = 35.4 Find median.
(a) 34 (b) 32 (c) 35 (d) 34.3
Q46. Mode for the data
Marks(below): 10 20 30 40 50 60 70 80 90
No. of students: 4 6 24 46 67 86 96 99 100
(a) 41 (b) 41.3 (c) 42 (d) none
Q47. Find the missing frequency for the following incomplete distribution when
mode is 36.

Marks: 0-10 10-20 20-30 30-40 40-50 50-60

No. of students: 5 7 - - 10 6
(a) 14,8 (b) 8,14 (c) 14,14 (d) none
Q48. Calculate mode from the following data:
Marks: 0-10 10-20 20-30 30-40 40-50 50-60 60-70 70-80 80-90
No. of
students: 2 4 18 22 21 19 10 3 1
(a) 43 (b) 43.33 (b) 30 (d) 40
Q49. Which of the following is the best measure of central tendency in case of
open-end distribution.
(a) mean (b) median (c) mode (d) none
Q50. Which of the following is a measure of central tendency:
(a) mean (b) standard deviation
(c) variance (d) mean deviation
Q51. Which of the following is the most stable measure of central tendency:
(a) mean (b) median
(c) mode (d) mean deviation
101 fill in the blanks

Q52. A statistical measure which cannot be determined graphically is

(a) mode (b) median
(c) both (a) and (b) (d) mean deviation
Q53. The measure of central tendency which takes into account all the data items
is:
(a) mean (b) median
(c) mode (d) none
Q54. An ogive is used to determine:
(a) mean (b) median
(c) mode (d) mean deviation
Q55. One of the method of determining mode is :
(a) mode = 2 median – 3 mean
(b) mode = 2 median + 3 mean
(c) mode = 3 median – 2 mean
(d) mode = 3 median +2 mean
Q56. The positional average of central tendency is:
(a) mean (b) median (c) S.D (d) none
Q57. Which of the following is the not a measure of central tendency:
(a) mean (b) median (c) mode (d) range
Q58. The median can graphically be found from:
(a) ogive (b) histogram
(c) frequency curve (d) none
Q59. In a moderately skewed distribution, the values of mode and mean are 6k and
9k respectively, then the value of median is:
(a) 8k (b) 7k (c) 6k (d) 5k

Q60. The A.M of a set of observations is x . If each observation is divided by k and

then is increased by 10 then the mean of the new series is :
(a) x / k (b) (x + 10) / k
(c) (x + 10k) / k (d) (k x + 10)

FILL IN THE BLANKS

1. ______ is a measure of central tendency calculated by dividing the sum of all
observations by the number of observations in the data set.
2. _____ series has two modes.
3. _________divides the distribution into two equal halves.
 measures of central tendency 102

4. __________ are the measures that describes the centre of the distribution.
5. ________ is the value of the middle item in a data set arranged in an ascending
or a descending order. It divides the data set into two equal parts.
6. ___________is the value that has the maximum frequency in the data set.
7. ___________distribution has only one mode.
8. ____________is an average in which each item in the data is weighted depending
on its importance in the total series.
9. _________ is an attempt to find one single figure to describe whole of figures.
10. If each item of a series is increased by a constant k, then the arithmetic mean
of the new series also get ___________.
11. If each item of a series is multiplied by a constant k then the arithmetic mean
of the new series also gets _____________ by k.
12. In case of _______, the lower limit of the first class interval and upper limit of
the last class interval is not known.
13. The term ‘weight’ refers to the ____________ of different items.
14. The point of intersection of the “less than” and the “greater than” ogives
corresponds to ______
15. The algebraic sum of the deviations of 20 observations measured from 30 is
2. Therefore, the mean of observations is __________.
16. The mean of 20 observations is 15. On checking, it was found that the two
observations were wrongly copied as 3 and 6. If wrong observations are
replaced by correct values 8 and 4 then correct mean is __
17. Emperical mode is given by _________
18. In a moderately skewed distribution, mode = ______________
19. In case of unequal class interval, while calculating mode, there is a need to
make them equal by adjusting the frequencies on the assumption that they
are __________ throughout the class.
20. Draw two lines diagonally in the inside of highest bar, starting from each upper
corner of the bar to the upper corner of the adjacent bar in a histogram to
determine _____graphically.

TRUE/FALSE
1. While calculating median, every individual item in the data is taken into
consideration.
2. In case of a symmetrical distribution, mean, median and mode are identical.
3. Extreme values in a given series strongly influence the median.
4. Mean tends to be the most frequently occurring value in a series.
5. If a series is arranged in an ascending or descending order, the median tends
to be the value of the middle item.
103 Answers to objective type questions

6. Mode is not influenced by extreme value in a series.

7. A mean calculated from grouped data is seldom exact.
8. The sum of deviations taken from arithmetic mean is minimum.
9. The sum of squares of deviations from arithmetic mean is zero.

10. X = A + ∑ d , where d =X - A is the short cut method of finding median.

n
11. Mean is not a good measure of central tendency in case of normal distribution
and in case of U shaped distribution.
12. There is no need to adjust the frequencies to make the class intervals equal
while calculating median.
13. Mean is a positional average.
14. Median and mode can be determined graphically.
15. Median and mode can be determined graphically.
16. Mean, median and mode have the same unit.
17. Median is a computed measure of central tendency.
18. Mean is independent of change of origin.
19. If the distribution is fairly regular, value of the variable corresponding to the
highest frequency gives mode.
20. Mean can be determined by inspection.

ANSWERS TO OBJECTIVE TYPE QUESTIONS

A1. (a) Each value in a class is equal to the mid-point
A2. (c) Zero
A3. (b) Minimum
A4. (a) Arrange the data in ascending or descending order.
A5. (c) Mean is a measure of central tendency.
A6. (a) 10
Mean = (7+8+9+9+17)/5 = 50/5 = 10
A7. (b) 9
th th
Median = size of  n + 1  item = size of  5 + 1  = 3rd item = 9
 2   2 
A8. (a)
Refer to Q6 and Q7
A9. (b) 23.5

Weighted mean =
∑ wx = 30 × 2 + 25 × 3 + 20 × 5 = 235 = 23.5
∑w 2+3+5 10
 measures of central tendency 104

A10. (a) 59.25

N 1X 1 + N 2 X 2 25 × 61 + 35 × 58
X 12 =
= = 59.25
N1 + N 2 25 + 35
A11. (a) 9289
745 + 2000 + 1500 + 68000 + 461 + 549 + 3750 + 1800 + 4795
Mean = = 9289
9
A12. (b) 1800
Arranging the given data in ascending order, we get
461, 549, 745, 1500,1800, 2000, 3750, 4795, 68000
th th
n +1  9 +1 th
Median= Size of   item = size of  2  = 5 item = 1800
 2   
A13. (c) X + n + 1
x1 + x2 + x3 + ....... + xn
We have X = ⇒ nX = x1 + x2 + x3 + ....... + xn
n
Let Y be the mean of xi + 2i ;i = 1,2,.........n . Then

(x1 + 2.1) + (x2 + 2.2) + (x3 + 2.3)....... + (xn + 2.n )

Y =
n
x + x2 + .....xn + 2(1 + 2 + 3 + ....n )

= 1
n
nX + 2n(n + 1) / 2
= = X + n +1
n
A14. (b) X / 3
This is because when each item of a series is multiplied by a constant k then
the arithmetic mean of the new series also gets multiplied by k, i.e., New mean
= kX
A15. (c) X + 3
This is because when each item of a series is increased or decreased by a
constant k, then the arithmetic mean of the new series also get increased or
decreased by k, i.e., New mean = X + k
A16. (c) X − 3
This is because when each item of a series is increased or decreased by a
constant k, then the arithmetic mean of the new series also get increased or
decreased by k, i.e., New mean = X + k
A17. (a) 7.089
105 Answers to objective type questions

Computation of Mean by Short-cut method

X f d= X – A =X – 6.5 fd
3.5 3 -3 -9
4.5 7 -2 -14
5.5 22 -1 -22
6.5 60 0 0
7.5 85 1 85
8.5 32 2 64
9.5 8 3 24

∑ f = 217 ∑ fd = 128
By short-cut method,

X =A+
∑ fd , d =X - A
∑f
128
= 6.5 +
217
= 6.5 + 0.589 = 7.089
A18. (b) 30.21
Solution:
Computation of Mean by direct method

X f Mid value(m) m − 32.5 fu

u=
5
20-25 170 22.5 -2 -340
25-30 110 27.5 -1 -110
30-35 80 32.5 0 0
35-40 45 37.5 10 45
40-45 40 42.5 20 80
45-50 35 47.5 105

∑ f = 50 ∑ fu = −220
X =A+
∑ fu × h = 32.5 + −220 × 5 = 30.21
∑f 480
A19. (a) 27.4
 measures of central tendency 106

Computation of Mean by direct method

X f Mid value(m) fm
0-10 7 5 35
10-20 6 15 90
20-30 15 25 375
30-40 12 35 420
40-50 10 45 450

∑ f = 50 ∑ fm = 1370

X =

∑ fm =
1370
= 27.4
∑f 50

A20. (b) 15.6

Let the first three terms be a, b, c then a + b + c = 14 ⇒ a+b+c=42

3
d+e
Let the next two terms be d and e. Then = 18 ⇒ d+ e=36
2
a + b + c + d + e 42 + 36
Mean of all 5 terms = = = 15.6
5 5
A21. (b) 1665

∑X ∑X
We know that X =
n
⇒ 1670 =
10
⇒ ∑ X = 16700
corr ∑ X = 16700 − wrong items + correct items

= 16700 - 2000 + 1950 = 16650
corr ∑ X 16650

corrX = = = 1665
n 10
A22. (b) 2595

X =
∑ X ⇒ 2750 = ∑ X ⇒ ∑ X = 77000
n 28
When lowest and highest sales are not taken into account then

∑ X = 77000 − 8950 − 850 = 67470
67470
New mean = = 2595
26
A23. (a) 1666.66
We are given that N 1 = 10, X 1 = 2000, N 2 = 20, X 2 = 1500
N 1X 1 + N 2 X 2 10 × 2000 + 20 × 1500
Combined mean = X 12 = = = 1666.66
N1 + N 2 10 + 20
107 Answers to objective type questions

A24. (a) 80%,20%

We are given that N 1 = ?, X 1 = 5200, N 2 = 100 − N 1 , X 2 = 4200
N 1X 1 + N 2 X 2

X 12 =
N1 + N 2
N 1 (5200) + (100 − N 1 )(4200)

⇒ 5000 =
100

⇒ N 1 = 80, N 2 = 20

A25. (c) 60%,40%

We are given that N 1 = ?, X 1 = 32, N 2 = 100 − N 1 , X 2 = 27
N 1X 1 + N 2 X 2
X 12 =

N1 + N 2
N 1 (32) + (100 − N 1 )(27)
⇒ 30 =

100
⇒ N 1 = 60, N 2 = 40

A26. (a) 70
We first find correct mean for section A.

X =
∑ X ⇒ 85 = ∑ X ⇒ ∑ X = 4250
n 50
corr
∑ X = 4250 − 50 + 0 = 4200
corr ∑ X 4200
corrX =
= = 84
n 50

N 1 = 50, X 1 = 84, N 2 = 40, X 2 = 60, N 3 = 60, X 3 = 65

N 1X 1 + N 2 X 2 + N 3X 3 50 × 84 + 40 × 60 + 60 × 65
Combined mean = X 123 = = = 70
N1 + N 2 + N 3 50 + 40 + 60
A27. (b) 75400
Mean production of 4 plants = 73000 feet.
Total production= 292000 feet
Production of fifth plant = 85000 feet
Total production of 5 plants = 292000+85000 = 377000
Average = 377000/5 = 75400 feet
A28. (a) 35
We are given that N 1 = 60, X 1 = 40, N 2 = 40, X = 38, X 2 = ?
N 1X 1 + N 2 X 2
X 12 =

N1 + N 2
 measures of central tendency 108

60(40) + (40)(X 2 )

⇒ 38 =
60 + 40

⇒ X 2 = 35
A29. (a) 52.6
The given data is in the form of individual observations.

X =

∑X =
43 + 60 + 37 + 48 + 65 + 48 + 57 + 78 + 31 + 59
= 52.6
n 10
A30. (b) 35

X =

∑ fX =
20 + 90 + 250 + 700 + 450 + 330 + 260
= 35
∑f 60

A31. (a) 91
Let the missing frequency be x. Then

∑ fX 60 + 300 + 1400 + 45x + 1485 + 845 + 675 + 340 5105 + 45x

X = = =
∑f 109 + x 109 + x

5105 + 45x
⇒ 46 = ⇒ x = 91
109 + x
2n + 1
A32. (b)
3
X W WX
1 1 1
2 2 22
3 3
. . 32
. . .
. . .
. . .
n n n2
n(n + 1) n(n + 1)(2 n + 1)
∑W = 2
∑WX =
6

Xw =

∑WX =
2n + 1
∑W 3

A33. (a) 59.2%, 58.43%

X =
∑X =
46 + 67 + 72 + 58 + 53
= 59.2%
n 5
109 Answers to objective type questions

Xw =
∑WX 46 × 2 + 67 × 2 + 72 × 1 + 58 × 1 + 53 × 1
= 58.43%
=
7
∑W
A34. (b) 631.5
Arranging the data in ascending order:
384, 391, 407, 522, 591, 672, 753, 777, 1490, 2488
n=10.
th th
n  n 
size of   item + size of  + 1 item
2 2
Med =    
2
th th
 10   10 
size of   item + size of  + 1 item
 2   2 
=
2

size of 5thitem + size of 6th item 591 + 672

= = = 631.5
2 2
A35. (a) 1200
Ascending order : 900,1000,1200,1400,1500
n= 5(odd)
th
n +1
size of   item
 2 
Med = = 3rd item = 1200
2
A36. (b) 97.5
A37. (a) 150

X f c.f
80 16 16
100 24 40
150 26 66
180 30 96
200 20 116
250 6 122
122

n + 1 122 + 1
= = 61.5
2 2
Look this value or just greater than this value in the c.f column, then the
corresponding value of X is median. Here median = 150
A38. (b) 56.25
 measures of central tendency 110

Computation of Median

Marks No. of students(f) c.f

0-25 30 30
25-50 50 80
50-75 80 160
75-100 40 200
n= 200

n 200
= = 100
2 2
Look for this value in the c.f column, we get the median class as 50-75
n
−c 100 − 80
Med = l + 2
× h = 50 + × 25 = 56.25
f 80
A39. (c) Median = 36.25
A40. (b) 153.79
A41. (b) 15, 10
Refer to example 20
A42. (a) Median = 40
A43. (b) Mode = 27
Refer to example 24
A44. (a) 64
Refer to example 25
A45. (d) Median = 34.3
Use mode = 3 median – 2 mean
A46. (b) 41.3
It is a bimodal series with mean = 42.2, median= 41.9. By using the formula
of empirical mode, we get mode = 41.3
A47. (b) 8, 14
Let the missing frequency corresponding to 20-30 be x then the frequency
corresponding to 30-40 is

50 − (5 + 7 + x + 10 + 6) = 22 − x
Since mode is 36, therefore, modal class is 30-40 with

fm = 22 − x , f1 = x , f2 = 10,l = 30,h = 10, ∆1 = 22 − x − x = 22 − 2x , ∆ 2 = 22 − x − 10 = 12 − x
∆1 22 − 2x
Mode = l +
×h ⇒ 36 = 30 + × 10 ⇒ x=8
∆1 + ∆ 2 22 − 2x + 12 − x
Then other frequency is 22 – 8 = 14
111 Answers to fill in the blanks

A48. (b) Mode = 43.33 marks

Refer to example 26
A49. (b) median
A50. (a) mean
A51. (a) mean
A52. (d) mean deviation
A53. (a) mean
A54. (b) median
A55. (c) mode = 3 median – 2 mean
A56. (b) median
A57. (d) range
A58. (a) ogive
A59. (a) 8k
Use Mode = 3 median – 2 mean
A60. (c) (x + 10k) / k

ANSWERS TO FILL IN THE BLANKS

1. Arithmetic mean
2. Bimodal
3. Median
4. Measures of central tendency
5. Median
6. Mode
7. Unimodal
8. Weighted mean
9. Average
10. Increased
11. Multiplied
12. open-end classes
13. relative importance
14. median

15. 30.1 because X = A + ∑d = 30 +

2
= 30.1
n 20
16. 15.15
17. Mode = 3 median – 2 mean
18. Mode = 3 median – 2 mean
 measures of central tendency 112

19. equally distributed

20. mode

ANSWERS TO TRUE/FALSE
1. False. Median is a positional average.
2. True
3. False
4. False. It is mode that occurs most frequently.
5. True
6. False
7. True
8. False. It is zero
9. False. The sum of squares of deviations from arithmetic mean is minimum.
10. False. It is for mean
11. True
12. True
13. False
14. True
15. True
16. True
17. False
18. False
19. True
20. False.
 C H A P T E R

5 Measures of Variation

Learning Objectives
By the end of this chapter, you will be able to understand:
u Meaning of variation.
u Properties of a good measure of variation.
u Absolute and relative measures of variation.
u Computation of Quartiles, deciles and Percentiles.
u Measures of variation: Range, Quartile deviation, Standard deviation,
Variance.
u Computation of combined standard deviation.
u How to compute coefficient of variation for measuring consistency.
u Skewness and Kurtosis

5.1 Introduction
In the previous chapter, we discussed various measures of central tendency
which endeavour to find one single figure to represent whole of the distribu-
tion. But in real life, we came across two or more distributions having same
average value but still they show wide disparities in their formation. This gives
rise to the concept of variation of the observations from the central value. In
this chapter, we study various measures of variation, relation between them
and their usage in measuring consistency or variability of the distributions.

5.2 Meaning of Variation or Dispersion

“The degree to which the numerical data tends to spread about an average
value is called variation or dispersion of data.” -Spiegel
113
Para 5.3 measures of variation 114

“Dispersion is a measure of the extent to which the individual items vary.”

-L.R. Connor

5.3 Characteristics of a Good Measure of Variation

The criteria for an ideal measure of dispersion or variation is same as those
for an ideal measure of central tendency. These are as follows:
1. It should be easy to compute and simple to understand.
2. It should be rigidly defined.
3. It should be based on all the observations of a series.
4. It should be capable of further algebraic treatment.
5. It should be affected as little as possible by fluctuations of sampling.
6. It should not be unduly affected by extreme observations.
5.4 Types of Measures of Variation
There are two types of measure of variation which are as follows:
1. Absolute measure of variation.
2. Relative measure of variation.
Absolute Measure of Variation: These are those measures of variation or dis-
persion which are expressed in the same statistical unit in which the original
data is given. For instance, absolute variation in the wages of workers will be
expressed in terms of rupees, absolute variation in the age of the employees
will be expressed in terms of years etc. These measures of variation does not
permit comparison of two or more sets of data in terms of their variability
when they involve different variables. In such a case, the two sets of data have
different units of measurement.
Relative Measure of Variation: These are the ratio of an absolute measure of
variation to an appropriate average. It is a pure number. It can be used for
comparing two or more sets of data when they involve different variables.
When one needs to compare two sets of data have different units of measure-
ment, then a comparison can be made only when one get rid of the units of
the data involved. It is done by computing some relative measures of variation
called coefficients of dispersion. For instance, if one wishes to compare the
share prices of two companies, then relative measure of variation can be used
to measure the variability. Although, share prices of both the companies are
expressed in terms of rupees but the two companies are evidently dissimilar.
Therefore, whenever two or more groups are to be compared for variation,
some measure of relative variation should be used.
115 Quartiles, deciles and percentiles Para 5.5

5.5 Quartiles, Deciles and Percentiles

Like median, we have other positional averages as well which are used to
divide the distribution in more than two parts. These are quartiles, deciles and
percentiles. Quartiles are those values of the variate which divides the distribution
in to four equal parts. Consequently, there are only three quartiles namely
Q1, Q2 and Q3. Q1 is called lower quartile, Q3 is called upper quartile and Q2 is
median. Deciles divides the distribution in to 10 equal parts and percentiles
divides the distribution in to 100 equal parts.
Computation of Quartiles, Deciles and Percentiles in different cases:
(i) In case of individual observations:
(a) Arrange the given data in ascending or descending order of magnitude.
(b) Count the number of observations. Let it be denoted by n.
th
n +1
(c) Qr = size of r   item , r = 1,2,3
 4 
th
n +1

Dr = size of r   item , r = 1,2,3,.........9
 10 
th
n +1
Pr = size of r 
 item , r = 1,2,3,.........99
 100 
(ii) Case of discrete series:
(a) Arrange the given data in ascending or descending order of magnitude.
(b) Compute the cumulative frequencies (c.f)
n +1
(c) Calculate r ( ) for finding rth quartile. Look this value in the c.f
4
n +1
column and find the total which is either equal to r ( ) or next
4
higher to it. Determine the corresponding value of the variable. This
is rth quartile.
n +1
Similarly, calculate r ( ) for finding rth decile. Look this value in
10
n +1
the c.f column and find the total which is either equal to r ( ) or
10
next higher to it. Determine the corresponding value of the variable.
This is rth decile.
n +1
Calculate r ( ) for finding rth percentile. Look this value in the c.f
100
n +1
column and find the total which is either equal to r ( ) or next
100
higher to it. Determine the corresponding value of the variable. This
is rth percentile.
Para 5.5 measures of variation 116

(iii) In case of continuous series:

(a) Compute the cumulative frequencies (c.f)
rn
(b) Calculate for finding rth quartile where r =1,2,3. Look this value
4
rn
in the c.f column and find the total which is either equal to or
4
next higher to it. Determine the corresponding class interval. This is
rth quartile class.
rn
−c
(c) Apply the formula : Q = l + 4 ×h
r
f
where l = lower limit of the quartile class, h = class size
f= frequency of the quartile class.
c = frequency of the class preceding to the quartile class.
rn
Deciles: For finding rth decile, Calculate where r =1,2,3…..9. Look this value
10
rn
in the c.f column and find the total which is either equal to or next
10
higher to it. Determine the corresponding class interval. This is rth decile class.
rn
−c
Apply the formula : D = l + 10 × h where l = lower limit of the decile class,
r
h = class size f
f= frequency of the decile class, c = frequency of the class preceding to the
decile class.
rn
Percentile: For finding rth percentile, Calculate where r =1,2,3…..99.
100
Look this value in the c.f column and find the total which is either equal to
rn
or next higher to it. Determine the corresponding class interval.
100
This is rth percentile class.
rn
−c
Apply the formula : P = l + 100 × h where l = lower limit of the percentile
r
f
class, h = class size
f= frequency of the percentile class, c = frequency of the class preceding to
the percentile class.

Example1: (Computation of quartile, decile and percentile in individual

observations) Compute lower and upper quartiles, 8th decile and 38th percentile
from the data given below:
117 Quartiles, deciles and percentiles Para 5.5

10, 11, 12, 11,12,13,14, 19, 17, 18, 12, 7, 6, 2, 3

Solution: Arranging the data in ascending order, we get
2, 3, 6, 7, 10, 11, 11, 12, 12, 12, 13, 14, 17, 18, 19
th
n +1
Lower quartile: Qr = size of r   item , r = 1
 4 
th
 15 + 1 
Q1 = size of 1  item
 4 
= size of 4th item = 7
th
Upper quartile: Q = size of r  n + 1  item , r = 3
r  4 
 
th
 15 + 1 
Q 3 = size of 3   item
 4 
= size of 12th item = 12
th
n +1
8th decile: Dr = size of r   item , r = 8
 10 
th
 15 + 1 
D 8 = size of 8   item
 10 
= size of 12.8th item
= value of 12th item + 0.8(value of 13th item – value of 12th item)
= 14 + 0.8 (17 – 14) = 16.4 marks
th
38th percentile: P = size of r  n + 1  item , r = 38
r  100 
 
th
 15 + 1 
P38 = size of 38   item
 100 
= size of 6.08th item
= value of 6th item + 0.8(value of 7th item – value of 6th item)
= 11 + 0.8 (11 – 11) = 11 marks.

Example2: (Third quartile and 4th decile in discrete series) Calculate the values
of Q3 (third quartile) and D4 (fourth decile) from the following data:
X: 10 5 7 11 8
F: 15 20 15 18 12
Para 5.5 measures of variation 118

Solution: Arranging the data in ascending order, we get

X f c.f
5 20 20
7 15 35
8 12 47
10 15 62
11 18 80
n =80
Upper quartile(Q3):
n +1  80 + 1 
r
4  = 3  4  = 60.75 . Look this value or next higher to it in the c.f column.
   
The value of X corresponding to it is 10. Therefore, upper quartile is Q3 = 10.
4th Decile (D4):
 n +1 80 + 1
r
10  = 4. 10 = 32.4 . Look this value or next higher to it in the c.f column.
 
The value of X corresponding to it is 7. Therefore, D4 = 7

Example3: (Computation of quartile, decile and percentile in discrete series)

Compute the lower and upper quartile, 4th decile, 45th percentile in the following
data:
X: 10 60 20 50 40 30
f: 4 2 7 7 8 15
Solution: Arranging the data in ascending order, we get

X f c.f
10 4 4
20 7 11
30 15 26
40 8 34
50 7 41
60 2 43
n =43
Lower quartile (Q1):
 n +1  43 + 1 
r
4  = 1 4  = 11 . Look this value or next higher to it in the c.f column.
   
The value of X corresponding to 11 is 20. Therefore, Lower quartile is Q1 = 20.
119 Quartiles, deciles and percentiles Para 5.5

Upper quartile( Q3):

 n +1  43 + 1 
r = 3  = 33 .Look this value or next higher to it in the c.f column.
 4   4 

The value of X corresponding to it is 40. Therefore, upper quartile is Q3 = 40.
4th Decile (D4):
 n +1 43 + 1
r = 4. = 17.6 .Look this value or next higher to it in the c.f column.
 10  10

The value of X corresponding to it is 30. Therefore, D4 = 30
45th Percentile (P45):
 n +1  43 + 1 
r = 45   = 19.8 .Look this value or next higher to it in the c.f column.
 100   100 


The value of X corresponding to it is 30. Therefore, P45 = 30

Example4: (Computation of Positional averages in continuous series) Compute

lower and upper quartile, 6th decile and 90th percentile.
Marks No. of students
Less than 5 4
Less than 10 10
Less than 15 20
Less than 20 30
Less than 25 55
Less than 30 77
Less than 35 95
Less than 40 100
Solution: We first the covert the data in to continuous series by adjusting the
frequencies.
Computation of Quartiles, Deciles and Percentiles
Marks No. of students c.f
0-5 4 4
5-10 6 10
10-15 10 20
15-20 10 30
20-25 25 55
25-30 22 77
30-35 18 95
35-40 5 100
n = 100
Para 5.5 measures of variation 120

Lower quartile:
rn 1(100)
= = 25 .
4 4
Look this value or next higher to it in the c.f column, we get the lower quartile
class as 15 – 20
rn
Q =l + ×h

25 − 20
Q1 = 15 + × 5 = 17.5
10

Upper quartile:
rn 3(100)
= = 75 .
4 4
Look this value or next higher to it in the c.f column, we get the upper quartile
class as 25 – 30
rn
−c
Qr = l + 4 ×h
f

75 − 55
Q 3 = 25 + × 5 = 29.55
22
6th decile:
rn 6(100)
= = 60 .
10 10
Look this value or next higher to it in the c.f column, we get the 6th decile class
as 25 – 30
rn
−c
Dr = l + 10 ×h
f
60 − 55
D 6 = 25 + × 5 = 26.14
22
90th percentile:
rn 90(100)
= = 90 .
100 100
Look this value or next higher to it in the c.f column, we get the 90th percentile
class as 30 – 35
121 Quartiles, deciles and percentiles Para 5.5

rn
−c
Pr = l + 100 ×h
f
90 − 77
P90 = 30 + × 5 = 33.61
18

Example 5 : The frequency distribution of marks of 800 students is given below:

Marks No. of students

40-50 10
50-60 40
60-70 80
70-80 140
80-90 170
90-100 130
100-110 100
110-120 70
120-130 40
130-140 20
Using appropriate positional averages, answer the following:
(i) If it is desired to pass 75% of the candidates, what should the minimum
passing marks be?
(ii) What is the minimum marks of the top 20% of the candidates?
Solution:
Computation of positional averages

Marks No. of students c.f

40-50 10 10
50-60 40 50
60-70 80 130
70-80 140 270
80-90 170 440
90-100 130 570
100-110 100 670
110-120 70 740
120-130 40 780
130-140 20 800
Para 5.5 measures of variation 122

(i) The minimum marks for passing 75% of the students is given by lower
quartile Q1.
Lower quartile( Q1):
n   800 

r   = 1  = 200 .Look this value or next higher to it in the c.f column.
4  4 
Quartile class is 70 – 80
rn
−c
Qr = l + 4
×h
f
200 − 130
Q1 = 70 +
× 10 = 75
140
Therefore, the minimum passing marks should be 75.
(ii) The minimum marks of the top 20% of the students are given by P80.
80th percentile:
rn 80(800)
= = 640 .
100 100
Look this value or next higher to it in the c.f column, we get the 80th
percentile class as 100 – 110
rn
−c

Pr = l + 100 ×h
f
640 − 570
P80 = 100 +
× 10 = 107
100
Therefore, the minimum marks of the top 20% of the students is 107 marks.

5.5 Measures of Variation

Following are the methods of studying variation.
1. Range
2. Interquartile range
3. Quartile Deviation
4. Standard Deviation

5.5.1 Range
It is the simplest method of studying dispersion. It can be defined as the differ-
ence between the largest item and the smallest item of the series.
123 Measures of variation Para 5.5

(a) In case of individual observations:

Range = L - S , where L= Largest item and S = Smallest item
(b) In case of discrete series: The range is equal to the difference between
the largest and the smallest X – values.
(c) In case of continuous series: Range is the difference between the upper
limit of the highest class interval and the lower limit of the lowest class
interval. In a continuous series or grouped frequency distribution, range
is only an approximate value since the actual largest and smallest values
are not available. In case of open-ended distributions, range cannot be
determined.
L −S
Coefficient of Range = , where L= Largest item and S = Smallest item
L +S
Coefficient of range is the relative measure of variation corresponding to range.
Merits of Range:
1. It is the simplest method of studying variation.
2. It is simple to calculate and easy to understand.
3. It is a quick method and takes less time for computation.
Demerits of Range:
1. It is subjected to fluctuations of sampling.
2. It is unduly affected by extreme observations.
3. It cannot be computed in case of open-end distributions.
4. It is not based on all the observations of a distribution.
Uses of Range:
Range is a useful measure of variation in the following cases:
1. Stock Exchange: Range is used to study the fluctuations in share prices.
For instance, range gives an idea about the change of prices of gold.
2. Quality Control: Control charts are prepared to monitor the quality of a
product. While preparing the control charts, range plays a very significant
role. Range can be used to set the upper control limit and lower control
limits in a control chart. If the quality of the product is outside these control
limits then it gives an indication that the product quality is not up to the
mark and should be examined for the possible cause of not following the
standard pattern.
3. Weather Forecasting: Range is of great use in meteorological department
for weather predictions. We very often hear about the minimum and
maximum day temperature at various places. It is of great concern to
everybody because they come to know about the variation in temperature
on a particular day.
Para 5.5 measures of variation 124

4. Day to day living: Range can be used in daily activities such as agricultural
productivity in an area, purchase of ready- made garments where we ask
the shopkeeper about the maximum and minimum price of garments
available in his shop.
Example6: (Range in case of individual observations) Compute the range and its
coefficient from the given below: 200, 208, 250, 170, 190, 320, 120, 180
Solution: Largest item = L = 320, smallest item = S = 120.
Range = L – S = 320 – 120 = 200
L − S 320 − 120 200
Coefficient of range = = = = 0.45
L + S 320 + 120 440
Example7: (Range in case of discrete series) Compute range and its coefficient
from the following data:
Variable(X) : 947 1028 1222 1107 1215 1099
Frequency: 13 45 32 17 19 41
Solution: Range = Largest X value – Smallest X value = 1222 – 947 = 275
L − S 1222 − 947 275
Coefficient of range = = = = 0.127
L + S 1222 + 947 2169
Example8: (Range in case of continuous series) Compute range and its coefficient
from the following data:

Wages (in ‘000 `): 100-110 110-120 120-130 130-140 140-150

No. of workers: 10 15 28 23 13
Solution: Range = Highest wages – lowest wages = 150 – 100 = 50
L − S 150 − 100 50
Coefficient of range = = = = 0.2
L + S 150 + 100 250
5.5.2 Interquartile Range
Interquartile range is the range between the quartiles. It is defined as the distance
between the upper and lower quartiles of a distribution. It is denoted by IQR. It
gives the range of the middle 50% of the values, ignoring 25% values on the lower
end and an equal number of values on the upper end of the data. It is given by:
IQR = Q 3 − Q1

Quartile Deviation
It is also called semi- interquartile range. It gives the average amount by which
the two quartiles differ from the median. It is an absolute measure of variation.
It is given by:
Q 3 − Q1
QD =
2
125 Measures of variation Para 5.5

Coefficient of quartile deviation: It is the relative measure of variation. It is

obtained by dividing the quartile deviation by one-half of the summation of
the values of the upper and lower quartiles. Therefore,
Q 3 − Q1

CQD = 2
Q 3 + Q1
2
Q 3 − Q1
CQD =
Q 3 + Q1

Merits of Quartile Deviation:

1. It is easy to understand and simple to calculate.
2. As compare to range which is based on only two observations, quartile
deviation is based on 50% of the data and as such is obviously a better
measure of variation.
3. It is not at all affected by extreme observations as it ignores 25% of the
data from the beginning and 25% of the data from the end.
4. It is a useful measure of variation in open- end distributions.
Demerits of Quartile Deviation
1. It is not based on all the observations of the series as it ignores 25% of the
data from the beginning and 25% from the top end.
2. It is unduly affected by fluctuations of sampling.
3. It is not capable of further algebraic treatment.
Inter-percentile range
It is an absolute measure of variation which is based on the difference be-
tween certain percentiles. The most commonly used is the one based on the
10th and the 90th percentile leaving 10% of the observations on each end of the
distribution. It is given by
Inter-percentile range = IPR = P90 – P10
P90 − P10
Coefficient of inter-percentile range =
P90 + P10

Example 9 : (IQR, QD and its coefficient in individual series) Find the interquartile
range, quartile deviation and its coefficient from the given data: 200, 250, 300,
220, 210, 208, 160
Solution: Arranging the data in ascending order, we get 160, 200, 208, 210, 220,
250, 300
Number of observations = n = 7
Para 5.5 measures of variation 126

Lower quartile:
th
n +1
Qr = size of r   item , r = 1,2,3
 4 
th
 7 +1
Q1 = size of 1  item
 4 
= size of 2nd item = 200
Upper quartile:
th
n +1
Qr = size of r   item , r = 1,2,3
 4 
th
 7 +1
Q 3 = size of 3   item
 4 
= size of 6th item = 250
Interquartile range:
IQR = Q 3 − Q1 = 250 − 200 = 50
Quartile deviation:
Q 3 − Q1 250 − 200
QD = = = 25
2 2
Coefficient of quartile deviation :
Q3 − Q1 250 − 200
CQD = = = 0.11
Q3 + Q1 250 + 200

Example1 0: (IQR, semi –IQR and its coefficient in discrete series) Find the inter-
quartile range, semi-interquartile range and its coefficient from the given data:
X: 5 15 25 35 45 55 65
F: 7 12 18 25 16 14 8
Solution:
Computation of IQR, Q.D and its coefficient
X f c.f
5 7 7
15 12 19
25 18 37
35 25 62
45 16 78
55 14 92
65 8 100
n=100
127 Measures of variation Para 5.5

Lower quartile:
 n +1  100 + 1 
r = 1  = 25.25
 4   4 


Look this value or next higher to it in the c.f column, we get Q1 = 25

Upper quartile:
 n +1  100 + 1 
r = 3  = 75.75
 4   4 


Look this value or next higher to it in the c.f column, we get Q3 = 45

IQR = Q3 – Q1 = 45 – 25 = 20
Q 3 − Q1 45 − 25
Semi-interquartile range or quartile deviation = Q .D = = = 10
2 2
Q 3 − Q1 45 − 25
CQD = = = 0.286
Q 3 + Q1 45 + 25

Example11: (Computation of middle 50%, Q.D and its coefficient, IPR in continuous
series) Compute quartile deviation and its coefficient and interpercentile range
from the data given below.
Marks No.of students
Above 0 80
Above 20 76
Above 40 50
Above 60 28
Above 80 18
Above 100 9
Above 120 3
Solution: We first convert the given data into continuous series by adjusting the
frequencies.
Computation of quartile deviation and its coefficient
Marks No.of students(f) c.f
0-20 4 4
20-40 26 30
40-60 22 52
60-80 10 62
80-100 9 71
100-120 6 77
120-140 3 80
Para 5.5 measures of variation 128

Lower quartile:
rn 1(80)
= = 20 .
4 4
Look this value or next higher to it in the c.f column, we get the lower quartile
class as 20 – 40
rn
−c
Qr = l + 4 ×h
f
20 − 4
Q1 = 20 + × 20 = 32.3
26
Upper quartile:
rn 3(80)
= = 60 .
4 4
Look this value or next higher to it in the c.f column, we get the upper quartile
class as 60 – 80
rn
−c
Qr = l + 4 ×h
f

60 − 52
Q 3 = 60 + × 20 = 76
10
Middle 50% = interquartile range = Q3 – Q1 = 76 – 32.3 = 43.7
Q 3 − Q1 76 − 32.3
Q .D = = = 21.85
2 2
Q 3 − Q1 76 − 32.3 43.7
CQD = = = = 0.4
Q 3 + Q1 76 + 32.3 108.3

90th percentile:
rn 90(80)
= = 72 .
100 100
Look this value or next higher to it in the c.f column, we get the 90th percentile
class as 100 –120
rn
−c
Pr = l + 100 ×h
f

72 − 71
P90 = 100 + × 20 = 103.3
6
129 Measures of variation Para 5.5

10th percentile:
rn 10(80)
= = 8.
100 100
Look this value or next higher to it in the c.f column, we get the 10th percentile
class as 20 – 40
rn
−c
Pr = l + 100 ×h
f
8−4
P10 = 20 + × 20 = 23.08
26
IPR = P90 - P10 = 103.3 – 23.08 = 79.92

Example12: Draw a cumulative frequency curve and hence find median and
quartiles from the data given below.

Marks: 0-5 5-10 10-15 15-20 20-25 25-30 30-35 35-40

No. of students: 4 6 10 10 25 22 18 5
How many students scored marks between 12.5 and 17.5?
Solution: We first find less than cf from the given data and draw less than ogive .

Marks (less than) No. of students

5 4
10 10
15 20
20 30
25 55
30 77
35 95
40 100
Para 5.5 measures of variation 130

100 Less than ogive

90
80
70
No. of students

60
50
40
30
20
10

0 5 10 15 20 25 30 35 40 45 50
Marks
Fig. 9.5 :

Median = Size of (n/2)th item = 100/2 = 50th item

From the graph, median = 24
Lower quartile = Size of (n/4)th item = (100/4)th item = 25th item
From graph, Q1= 17.5
Upper quartile = Size of (3n/4)th item = (300/4)th item = 75th item
From graph, Q3 = 29.5
In order to determine the number of students who scored between 12.5 and
17.5, locate these values on X axis and draw perpendiculars from these points
on the curve. Then draw perpendiculars on Y axis . Determine the point where
it meets the Y axis. From the graph, these points are 15 and 25 respectively.
Therefore, number of students who scored between 12.5 and 17.5 = 25-15 =
10 students.

Example13 : The 25th percentile and 75th percentile of a distribution of marks of the
students of a class are 30 and 70 respectively. On the basis of this information,
find the coefficient of quartile deviation of the distribution of marks.
Solution: We know that 25th percentile is the value of the lower quartile. Therefore
Q1 = 30.
Similarly, 75th percentile is the value of the upper quartile. Therefore Q3 = 70.
Q 3 − Q1 70 − 30 40
CQD = = = = 0.4
Q 3 + Q1 70 + 30 100

Example14: If the coefficient of quartile deviation = 0.6 and Q.D = 15,

then Q1 = 10 and Q3 = 40. Comment upon the statement.
131 Measures of variation Para 5.5

Solution:
Q 3 − Q1
Q .D = = 15 ⇒ Q 3 − Q1 = 30 ……..(i)
2
Q 3 − Q1
CQD =
Q 3 + Q1

30
⇒ 0.6 =
Q 3 + Q1
⇒ Q 3 + Q1 = 50 ………(ii)
Solving the two equations, we get Q1 = 10 and Q3 = 40. Hence the given state-
ment is true.
5.5.4 Standard deviation
Standard deviation is defined as the positive square root of the average of
squared deviations taken from the arithmetic mean. It is also called root-mean
–squared –deviations. It is an absolute measure of variation. It is denoted by
greek letter σ (sigma). Since the sum of squared deviations from the arithmetic
mean is minimum, mean is the only average from which the deviations are
measured while calculating standard deviation.
Computation of standard deviation in different cases.
(a) In case of individual observations:
Actual mean method:

When deviations are taken from mean, ∑ (X X)

Note: This method is preferred when actual mean X is not in fractions.

2

When deviations are not taken, s =

∑X − X
( )
2

n
where n is the number of observations.
2 2

Assumed mean method: s =

∑d  ∑d
−

 ,where d=X-a, a = assumed mean
n  n
 
Note: This method is suitable when actual mean X is in fractions.
(a) In case of frequency distribution:
Actual mean method:
2
When deviations are taken from mean, s = ∑ f (X − X )
∑f
2

When deviations are not taken, s =

∑ fX − X
( )
2

∑f
Para 5.5 measures of variation 132

2 2

Assumed mean method: s =

∑ fd  ∑ fd
−

 ,where d=X-a, a = assumed mean
∑f  ∑f
 
where d= X-A, A= assumed mean
2 2
∑ fu  ∑ fu  X −A
Step deviation method: s = −  × h , where u= , a = assumed mean,
∑f  ∑ f h

A = assumed mean, h = step factor

Mathematical properties of standard deviation
Following are the properties of standard deviation.
1. If each value in a given series is increased (decreased) by a constant k,
the standard deviation remains unaffected.
2. If each value in a given series is multiplied (divided) by a constant, k, the
standard deviation of the new series would be multiplied (divided) by
absolute value of the constant.
3. The sum of the squares of the deviations of items from the arithmetic
mean is least.
4. The standard deviation enables us to determine where the values of a
frequency distribution is located. For a normal distribution if arithmetic
mean is µ and standard deviation σ then µ ± σ covers 68.27% of the items,
µ ± 2σ covers 95.4% of the items,µ ±3σ covers 99.7% of the items.
5. When all the observations are equal, standard deviation is zero.
6. Standard deviation of two numbers is half of range. i.e., s = 1 a − b
2
7. Combined standard deviation: The combined standard deviation of two
or more series can be obtained by the following formula.
2 2 2 2
n1s 1 + n2s 2 + n1d1 + n2d 2
s 12 = , d1 = X 12 − X 1 and d 2 = X 12 − X 2
n1 + n2

where X 12 is the combined arithmetic mean, X and X are the individual

1 2
arithmetic means of the two related groups, n1 and n 2 are the number of ob-
servations in the first and second group respectively, s 1 and s 2 are the standard
deviations of the first and second groups respectively.
Merits of standard deviation:
1. Standard deviation is the most important and widely used measure of
dispersion.
2. It is rigidly defined.
3. It is based on all the observations.
4. It is less affected by the fluctuations of sampling.
133 Measures of variation Para 5.5

5. It is capable of further algebraic treatment.

Demerits of standard deviation:
1. It is difficult to compute.
2. It gives more weight to extreme items and less weight to those which are
near the mean.

Example15: (S.D in individual series by actual mean method) Compute standard

deviation from the data given below:
12, 115, 76, 42, 7, 19, 49, 80
12 + 115 + 76 + 42 + 7 + 19 + 49 + 80
Solution: X = = 50
8
Since the mean of the given data is not in fractions, it is advisable to use actual
mean method.
Computation of S.D
X
(X − X ) = (X − 50) (X − X )2
12 -38 1444
115 65 4225
76 26 676
42 -8 64
7 -43 1849
19 -31 961
49 -1 1
80 30 900
Total 10120
2

s =
∑ (X − X )
n
10120
= 35.57
=
8
Example16: (S.D in individual series by direct method) Compute the standard
deviation of the first n natural numbers.
Solution: The first n natural numbers are 1, 2, 3, 4,5 ……….n

X =
∑X =
1 + 2 + 3 + 4 + ....... + n n(n + 1) n + 1
= =
n n 2n 2
2 n(n + 1)(2n + 1)
∑X = 12 + 22 + .......... + n 2 =
6
2

s =
∑X − X
( )
2

n
Para 5.5 measures of variation 134

2
n(n + 1)(2n + 1)  n + 1 
= −
6n  2 


2n 2 + 3n + 1 n 2 + 2n + 1
= −
6 4
n2 − 1
=
12

Example17: (S.D in individual series by assumed mean method) Compute the

standard deviation of the following data.
260.12, 260.13, 260.15, 260.12, 260.17, 260.15, 260.17, 260.16, 260.22, 260.21
Solution:
Computation of standard deviation
X d=X-A = X - 260 d2
260.12 0.12 0.0144
260.13 0.13 0.0169
260.15 0.15 0.0225
260.12 0.12 0.0144
260.17 0.17 0.0289
260.15 0.15 0.0225
260.17 0.17 0.0289
260.16 0.16 0.0256
260.22 0.22 0.0484
260.21 0.21 0.0441
Total 1.6 0.2666

2 2

s =
∑d  ∑d
−

 ,where d=X- 260
n  n
 
2
0.2666  1.6 
s = −
10  10 


= 0.033

Example18: (S.D in discrete series by assumed mean method) Compute the

standard deviation of the following data.
X: 3.5 4.5 5.5 6.5 7.5 8.5 9.5
F: 3 7 22 60 85 32 8
135 Measures of variation Para 5.5

Solution:
Computation of standard deviation
X f d=X - 6.5 fd fd2
3.5 3 -3 -9 27
4.5 7 -2 -14 28
5.5 22 -1 -22 22
6.5 60 0 0 0
7.5 85 1 85 85
8.5 32 2 64 128
9.5 8 3 24 72

Total 217 128 362

2 2

s =
∑ fd  ∑ fd
−

 ,where d=X- 6.5
∑f  ∑f
 

2
362  128 
= −
217  217 
2
= 1.668 − ( 0.59 )

= 1.149

Example19: (S.D in discrete series by actual mean method) Compute the standard
deviation of the following data.
X: 0 1 2 3 4
F: 1 9 7 5 3
Solution:
Computation of standard deviation
X f fX X − X =X-2 (X − X )2 f (X − X )2
0 1 0 -2 4 4
1 9 9 -1 1 9
2 7 14 0 0 0
3 5 15 1 1 5
4 3 12 2 4 12

Total 25 50 30
Para 5.5 measures of variation 136

X =
∑ fX =
50
=2
∑f 25
Since the mean is not in fractions, it is advisable to use actual mean method.
2

s =
∑ f (X − X ) =
30
= 1.095
∑f 25

Example20: (S.D in continuous series by step deviation method) Compute the

standard deviation of the following data.

Variable frequency
3.0-3.5 2
3.5-4.0 6
4.0-4.5 12
4.5-5.0 15
5.0-5.5 16
5.5-6.0 10
6.0-6.5 5
6.5-7.0 2
Solution:
Computation of Standard deviation
Variable Midpoint (X) f X −A fu fu2
u=
h
X − 4.75
u=
0.5
3.0-3.5 3.25 2 -3 -6 18
3.5-4.0 3.75 6 -2 -12 24
4.0-4.5 4.25 12 -1 -12 12
4.5-5.0 4.75 15 0 0 0
5.0-5.5 5.25 16 1 16 16
5.5-6.0 5.75 10 2 20 40
6.0-6.5 6.25 5 3 15 45
6.5-7.0 6.75 2 4 8 32
Total 68 29 187

2 2

s =
∑ fu  ∑ fu 
− × h ,where u =
X − 4.75
∑f  ∑ f  0.5
 
137 Measures of variation Para 5.5

2
187  29 
= − × 0.5
68  68 
2
= 2.75 − ( 0.426 ) × 0.5

= 0.8

Example21: (Properties of standard deviation) The following table gives the length
of life of 400 bulbs.
Length of life (in hours) No. of bulbs
1000-1199 12
1200-1399 30
1400-1599 65
1600-1799 78
1800-1999 90
2000-2199 55
2200-2399 36
2400-2599 25
2600-2799 9
Calculate (i) the average length of life of a bulb (ii) The S.D of the length of
life of a bulb.
(iii) The percentage number of bulbs where length of life of a bulb falls within
X ± 2s
Solution :
Computation of mean and S.D
Length of life Midpoint f X − 1899.5 fu fu2
(X) u=
200
999.5-1199.5 1099.5 12 -4 -48 192
1199.5-1399.5 1299.5 30 -3 -90 270
1399.5-1599.5 1499.5 65 -2 -130 260
1599.5-1799.5 1699.5 78 -1 -78 78
1799.5-1999.5 1899.5 90 0 0 0
1999.5-2199.5 2099.5 55 1 55 55
2199.5-2399.5 2299.5 36 2 72 144
2399.5-2599.5 2499.5 25 3 75 225
2599.5-2799.5 2699.5 9 4 36 144
Total→ 400 -108 1368
Para 5.5 measures of variation 138

X =A+
∑ fu × h
∑
108
= 1899.5 − × 200
400
= 1845.5
2 2

s =
∑ fu  ∑ fu 
− × h ,where u =
X − 1899.5
∑f  ∑ f  200
 
2
1368  −108 
= − × 200
400  400 

= 3.42 − 0.73 × 200

= 1.829 × 200

= 365.9
X ± 2s = 1845.5 ± 2(365.9) = 1113.7 to 2577.3
No. of frequency lying between 1113.7 to 2577.3 is

=
(1199.5 − 1113.7)
× 12 + 30 + 65 + 78 + 90 + 55 + 36 +
( 2577.3 − 2399.5) × 25
200 200
= 5.148 + 30 +65 +78 +90 +55 +36+ 22.225
= 381.373
381.373
Percentage of total frequency lying within limits X ± 2s = × 100 = 95.343%
400
Example22: (Correcting standard deviation) Mean and standard deviation of
100 items were found to be 40 and 10. If at the time of calculations, two items
were wrongly taken as 30 and 70 instead of 3 and 27, find the correct mean
and correct standard deviation.
Solution:
Since X = 40, s x = 10,wrong X = 30,70, N = 100

X =
∑X ⇒ ∑ X = N X = 100 × 40 = 4000
N
Then, corr ∑ X = 4000 − 30 − 70 + 3 + 27 = 3930

corr ∑ X 3930
corr X = = = 39.3
N 100
139 Measures of variation Para 5.5

2
Also, s x = ∑X − X
( )
2

N
Squaring both sides we get
2

s x2 =
∑X − X ( )
2

N
2

⇒ (10)2 =
∑X − ( 40 )
2

100
⇒ ∑ X 2 = 170000

corr ∑ X 2 = 170000 − (30)2 − (70)2 + (3)2 + (27)2 = 164938

corr ∑ X 2 2
Now, corr s x = − corr X
( )
N

164938 2
= − ( 39.3)
100

= 1649.38 − 1544.49 = 10.24

Example23: (S.D when a new item is added) The arithmetic mean and standard
deviation of a set of 9 items are 43 and 5 respectively. If an item is added to
the set, find the mean and standard deviation of 10 items.
Solution: First take X = 43, s = 5, N = 9

Then X = ∑X⇒ ∑ X = N X = 9 × 43 = 387

N
After addition of value 63, then N = 10

X =
∑X =
450
= 45
N 10
2

Also, s x =
∑X − X
( )
2

N
Squaring both sides we get
2

sx 2
=
∑X − X ( )
2

N
2

⇒ (5)2 =
∑X − ( 43)
2

9
2
⇒ ∑ X = 16866
Para 5.5 measures of variation 140

After adding the value 63,

2
∑X = 16866 + (63)2 = 20835
2
Now, s x = ∑X − X
( )
2

N
20835 2
= − ( 45)
10
= 2083.5 − 2025 = 7.65(approx )

Example24: (Combined Standard Deviation) The mean of two samples of sizes

50 and 100 are 54.4 and 50.3 and their S.D are 8 and 7 respectively. Find the
combined standard deviation of 150 items.
Solution: We are given that X 1 = 54.4, X 2 = 50.3, N 1 = 50, N 2 = 100,s 1 = 8,s 2 = 7
N 1X 1 + N 2 X 2
X 12 =
N1 + N 2

50(54.4) + 100(50.3)
=
50 + 100
= 51.67
d1 = X 12 − X 1 = 51.67 − 54.4 =2.73
d 2 = X 12 − X 2 = 51.67 − 50.3 = 1.37

N 1s 12 + N 2s 22 + N 1d12 + N 2d 22
s 12 = ,
N1 + N 2

50(8)2 + 100(7)2 + 50(2.73)2 + 100(1.37)2

=
50 + 100

3200 + 4900 + 372.645 + 187.69

150
= 57.736 = 7.598
Example: (Combined S.D) For two groups of observations, the following results
are available:
2
Group I: ∑ ( X − 5) = 8 ∑ ( X − 5) = 40 N 1 = 20
2
Group II: ∑ ( X − 8) = −10 ∑ ( X − 8) = 70 N 2 = 25

Find mean and S.D of both groups taken together.

Solution: For group I, let d = X – 5 then A = 5
141 Measures of variation Para 5.5

X1 = A +
∑d = 5+
8
= 5.4
n 20
2 2 2

s1 =
∑d  ∑d
−

 =
40  8 
− = 1.356  1.4
n  n
  20  20 

X2 = A +
∑d = 8+
−10
= 7.6
n 25

2 2 2

s2 =
∑d
−
 ∑d 
 =
70  −10 
− = 1.6
n  n
  25  25 
N 1X 1 + N 2 X 2
X 12 =
N1 + N 2

20(5.4) + 25(7.6)
=
20 + 25
= 6.6
d1 = X 12 − X 1 = 6.6 5.4 =1.2
2
= X 12 − X 2 = 6.6 − 7.6 = 1.0

N 1s 12 + N 2s 22 + N 1d12 + N 2d 22
s 12 = ,
N1 + N 2

20(1.4)2 + 25(1.6)2 + 20(1.2)2 + 25(1)2

=
20 + 25
39.2 + 64 + 28.8 + 25
=
45
= 3.489 = 1.868
Example: (Combined standard deviation) Find the missing information in the
following data:

Group A Group B Group C Combined

Number 50 - 90 200
S.D 6 7 - 7.746
Mean 113 - 115 116
Solution: We are given that 50 + N 2 + 90 = 200 . This gives N 2 = 60

N 1X 1 + N 2 X 2 + N 3X 3
X 123 =
N1 + N 2 + N 3
Para 5.5 measures of variation 142

50(113) + N 2 X 2 + 90(115)
⇒ 116 =
200

5650 + 60X 2 + 10350

⇒ 116 =
200
⇒ s 32 = 64 or s 3 = 8 ⇒ X 2 = 120

d1 = X 123 − X 1 = 116 − 113 =3

d 2 = X 123 − X 2 = 116 − 120 = 4
d3 = X 123 − X 3 = 116 − 115 = 1

N 1s 12 + N 2s 22 + N 1d12 + N 2d 22 + N 3d 32
s 12 =
N1 + N 2 + N 3

2 2 2 2 2 2
50(6) + 60(7) + 90(s 3 ) + 50(3) + 60(4) + 90(1)
⇒ 7.746 =
200

1800 + 2940 + 90s 32 + 450 + 960 + 90

⇒ (7.746)2 =
200

6240 + 90s 32
⇒ (7.746)2 =
200
⇒ s 32 = 64 or s 3 = 8

5.5.5 Variance:
It can be defined as the average of the squared deviations measured from the
arithmetic mean. It is the square of standard deviation. Variance is given by:
2
Variance = s
It may be noted that while the standard deviation carries the same units as the
original data, the variance is expressed in squared units. It is also a measure
of absolute variation. It is useful in portfolio management where the total
risk associated with the share of stock is measured in terms of the variance
of returns on it.
Properties of Variance
Following are the properties of variance.
1. If each value in a given series is increased (decreased) by a constant k,
the variance remains unaffected.
143 Measures of variation Para 5.5

2. If each value in a given series is multiplied (divided) by a constant, k, the

variance of the new series would be equal to variance of the given series
multiplied (divided) by k2.
3. Combined Variance: The combined variance of two or more series can
be obtained by the following formula.
2 2 2 2
2 n1s 1 + n2s 2 + n1d1 + n2d 2
s 12 = , d1 = X 12 − X 1 and d 2 = X 12 − X 2
n1 + n2
where X 12 is the combined arithmetic mean, X 1 and X 2 are the individual
arithmetic means of the two related groups, n1 and n 2 are the number of ob-
servations in the first and second group respectively, s 1 and s 2 are the standard
deviations of the first and second groups respectively.

Example : (Variance in a continuous series) Compute variance from the data

given below:
Class interval:
20-25 25-30 30-35 35-40 40-45 45-50
Frequency: 170 110 80 45 40 35
Solution: Computation of variance
Variable X f X −A X − 32.5 fu fu2
u= =
h 5
20-25 22.5 170 -2 -340 680
25-30 27.5 110 -1 -110 110
30-35 32.5 80 0 0 0
35-40 37.5 45 1 45 45
40-45 42.5 40 2 80 160
45-50 47.5 35 3 105 315
Total 480 -220 1310

2 2

s =
∑ fu  ∑ fu 
− × h ,where u =
X − 32.5
∑f  ∑ f  5
 
2
1310  −220 
= − ×5
480  480 

= 2.729 − ( −0.458 )2 × 5

= 7.936
Then variance = (S.D)2 = (7.936)2 = 62.98
Para 5.6 measures of variation 144

Example: In a series of 5 observations, the mean and variance are 4.4 and 8.24.
If three observations are 1, 2 and 6 find the other two.
Solution: Let the other two observations be x, y. Then,
x + y +1+ 2 + 6
X = = 4.4
5
⇒ X 2 = 120 ⇒ x + y = 13 or y=13-x
2
s2 =
∑X − X ( )
2

n
2

⇒ 8.24 =
∑X − ( 4.4 )
2

5
2

⇒ 8.24 + 19.36 =
∑X
5
⇒ ∑ X 2 = 138
⇒ x 2 + y 2 + 12 + 22 + 62 = 138

⇒ x 2 + y 2 + 1 + 4 + 36 = 138

⇒ x 2 + y 2 = 97
⇒ x 2 + (13 − x) 2 = 97
⇒ x 2 + 169 + x 2 − 26 x = 97
⇒ 2x 2 − 26x + 72 = 0

⇒ 2 ( x − 9 )( x − 4 ) = 0
⇒ x = 9, x = 4
⇒ y = 4, y = 9
Therefore, the other two observations are 4 and 9.

5.6 Coefficient of Variation

Coefficient of variation is a relative measure of variation. It was given by Karl
Pearson. It is used in such problems where we want to compare the variability
of two or more series. The series for which coefficient of variation is greater
will be more variable or conversely less stable, less uniform, less consistent or
s
less homogenous. It is denoted by C.V. It is given by C .V = × 100
X
145 Coefficient of variation Para 5.6

Example: (Determining stability in individual series using C.V)From the prices

of shares of X and Y given below, state which share is more stable in value.

X: 55 54 52 53 56 58 52 50 51 49
Y: 108 107 105 105 106 107 104 103 104 101
Solution: Since we have to find the stability in prices of shares of X and Y, we
compare the coefficient of variation of X and Y.
Computation of C.V of X and Y
X Y
X − X = X − 53 (X − X )
2
Y = Y − 105 (Y − Y )2
55 2 4 108 3 9
54 1 1 107 -2 4
52 -1 1 105 0 0
53 0 0 105 0 0
56 3 9 106 1 1
58 5 25 107 2 4
52 -1 1 104 -1 1
50 -3 9 103 -2 4
51 -2 4 104 -1 1
49 -4 16 101 -4 16
Total=530 70 1050 40

X =
∑X =
530
= 53
n 10
2

sX =
∑ (X − X ) =
70
= 2.645
n 10
sX 2.645
C .Vx = × 100 = × 100 = 5%
X 53

Y =
∑Y =
1050
= 105
n 10
2

sY =
∑ (Y −Y ) =
40
=2
n 10
sY 2
C .Vy = × 100 = × 100 = 1.9%
Y 105
Since C.V of Y is lesser than that of X, therefore Y is more stable.
Para 5.6 measures of variation 146

Example: (Consistency in individual series using C.V) During 10 weeks of a

session, the marks obtained by two candidates, Ramesh and Suresh, taking
the computer programme course are given below:

Ramesh: 58 59 60 54 65 66 52 75 69 52
Suresh: 87 89 78 71 73 84 65 66 56 46
(i) Who is a better scorer?
(ii) Who is a more consistent scorer?
Solution:
Computation of C.V of Ramesh and Suresh
Ramesh(X) Suresh(Y)
X − X = X − 61 (X − X )
2 d y = Y − A = Y − 66 d y2
58 -3 9 87 21 441
59 -2 4 89 23 529
60 -1 1 78 12 144
54 -7 49 71 5 25
65 4 16 73 7 49
66 5 25 84 18 324
52 -9 81 65 -1 1
75 14 196 66 0 0
69 8 64 56 -10 100
52 -9 81 46 -20 400
Total=610 526 715 55 2013

X =
∑X =
610
= 61
n 10
2

sX =
∑ (X − X ) =
526
= 7.25
n 10
sX 7.25
C .Vx = × 100 = × 100 = 11.98%
X 61

Y =A+
∑d y
= 66 +
55
= 71.5
n 10
2 2

sY =
∑d y
 ∑dy
−


n  n
 
2
2013  55 
= − 
10  10 
147 Coefficient of variation Para 5.6

= 13.08
sY 13.08
C .Vy = × 100 = × 100 = 18.29%
Y 71.5
Better score: Suresh is a better scorer since his mean is higher.
More consistent: Since C.V of Ramesh is lesser than that of Suresh, therefore
Ramesh is more consistent.

Example: (Consistency in discrete series) The following is the record of goals

scored by team A in a football session:

No. of goals scored: 0 1 2 3 4

No. of matches : 1 9 7 5 3
For team B, the average number of goals scored per match was 2.5 with a
standard deviation of 1.25 goals. Find which team may be regarded as more
consistent?
Solution: To measure the consistency of two teams, we compare the C.V of the
two teams.
Computation of C.V of team A
X f fX X − X =X-2 (X − X )2 f (X − X )2
0 1 0 -2 4 4
1 9 9 -1 1 9
2 7 14 0 0 0
3 5 15 1 1 5
4 3 12 2 4 12

Total 25 50 30

X =
∑ fX =
50
=2
∑f 25

Since the mean is not in fractions, it is advisable to use actual mean method.
2

s =
∑ f (X − X ) =
30
= 1.095
∑f 25
s 1.095
C.V for team A = × 100 = × 100 = 54.5%
X 2
s 1.25
C.V for team B = × 100 = × 100 = 50%
X 2.5
Since C.V of team B is lesser than that of team A, therefore team B is more
consistent.
Para 5.6 measures of variation 148

Example: (Uniformity using C.V) After settlement, the average weekly wages in
a factory had increased from `8000 to `12000 and the standard deviation had
increased from `100 to `150. After settlement, the wages has become higher
and more uniform. Do you agree?
Solution: Before settlement, X = 80, s = 12
s 100
C .V = × 100 = × 100 = 1.25%
X 8000
After settlement,
s 150
C .V = × 100 = × 100 = 1.25%
X 12000
Since there is no change in C.V, there is no improvement in uniformity.

Example: (C.V) Find the coefficient of variation if the variance is 16, number of
items is 20 and the sum of the items is 160.
Solution: S .D = Var = 16 = 4

A.M =
∑X 160
==8
n 20
s 4
C .V = × 100 = × 100 = 50%
X 8

Example: (Interpretation of C.V) The means and S.D of two brands of light bulbs
are given below:

Brand I Brand II
Mean 800 hrs 770hrs
S.D 100 hrs 60 hrs
Compute a measure of relative dispersion for two brands and interpret your
result.
Solution: Coefficient of variation is the most suitable measure of dispersion while
comparing the two sets of data.
For brand I,
s 100
C .V = × 100 = × 100 = 12.5%
X 800
For brand II,
s 60
C .V = × 100 = × 100 = 7.8%
X 770
Interpretation: Since C.V of Brand II is lesser, therefore, Brand II bulbs are
more consistent and more reliable.
149 Coefficient of variation Para 5.6

Example: (C.V) The number of employees, average wage per employee and
variance of the wages per employee for two factories are given below:

Factory A Factory B
No. of employees 100 200
Average wage per employee (`) 120 200
Variance of the wages per employee (`) 16 25
(i) Which factory’s wage bill is larger?
(ii) Which factory’s workers are better off? And Why?
(iii) In which factory, is there greater variation in the distribution of wage per
employee?
(iv) Calculate the combined average wage per employee of the two factories.
Solution: Let X denotes the data of factory A and Y denotes the data of factory
B. Then,
N 1 = 100, N 2 = 200, X 1 = 120, X 2 = 200,s X2 = 16,s Y2 = 25

Wage bill of factory A = Number of employees × Average wage per employee

= 100 × 120 = `12000
Wage bill of factory B = 200 × 200 = `40000
Therefore, factory B’s wage bill is larger.
(ii) Factory B’s workers are better off since mean of factory B is higher than
that of factory A.
(iii) In order to check variability, we compare the C.V of two factories.
sX 4
C .VX =
× 100 = × 100 = 3.33%
X1 120
s 5
C .VY = Y × 100 =
× 100 = 2.5%
X2 200
Since, C.V in case of factory A is greater than that of factory B, therefore
there is greater variation in the distribution of wages per employee of
factory A.
(iv)

N X + N 2 X 2 100 × 200 + 200 × 200

Combined average= 1 1 = = 173.33
N1 + N 2 100 + 200
Therefore, Combined average wage per employee is `173.33

Example: (Properties of mean and standard deviation) If 20 is subtracted from

every observation in a data set, then the coefficient of variation of the resulting
data is 20%. If 40 is added to every observation of the same data set then the
Para 5.6 measures of variation 150

coefficient of variation of the resulting set of data is 10%. Find mean and S.D
of the original set of data.
Solution: We know that when a constant is subtracted from every observation
then their mean is also subtracted by same constant but the S.D remains
unaffected. So when 20 is subtracted from every observation in a data set,
then the mean also gets reduced by 20. Then the new mean is X − 20 and the
new S.D remains σ. In such a case,
s
C .V = × 100
X
s
⇒ 20 = × 100
X − 20

⇒ 20X − 400 = 100s

⇒ X − 5s = 20 ..........(i)
Now if 40 is added to every observation of the same data set then the new
mean is X + 40 and the S.D remains σ . In such a case,
s
C .V = × 100
X
s
⇒ 10 = × 100
X + 40
⇒ 10X − 100s = −400
⇒ X − 10s = −40 ............(ii)

Solving (i) and (ii), we get

X = 80,s = 12

Example: (Properties of mean and standard deviation) The coefficient of variation

of salaries of the employees of an organisation was 30% while their mean was
`5000. Subsequently, each of the employees was paid `1000 by the way of
bonus. How would it affect the coefficient of variation.
s
Solution: We know that C .V = × 100
X
s
⇒ 30 = × 100
5000
⇒ s = 1500
When a bonus of ` 1000 to each employee is paid then the mean would also
increase by 1000. i.e, the new mean is 5000 +1000 = 6000. But there will be no
change in S.D. Then new C.V is
151 Coefficient of variation Para 5.6

s
C .V = × 100
X
1500
= × 100
6000
= 25%

Example: (Variability using C.V) A sample A of 100 ball bearings is taken and its
mean and standard deviation were found to be 0.16912 cm and 0.002206 cm
respectively. Another sample B of 100 ball bearings has mean 0.1705 cm and
S.D 0.002184 cm. Compare the variation in two samples. It was discovered in
respect of sample B that due to fault in the measuring instrument, the diameters
were consistently over-estimated by 0.006 cm. In the light of this information,
calculate the corrected mean and S.D. Also compare the variability in the two
values using corrected values.
Solution: Before fault:
s 0.002206
C .VA = × 100 = × 100 = 1.3%
X 0.16912

s 0.002184
C .V B = × 100 = × 100 = 1.28%
X 0.1705
Therefore, Sample A shows more variation before fault was determined as its
C.V is greater as compare to sample B.
After Fault:
Since the diameter was over – estimated by 0.006 cm therefore the error can be
corrected by reducing the mean by 0.006 cm. Then new mean = 0.1705 – 0.006
= 0.1645. There will be no change in S.D. Then the new C.V of sample B is :
s 0.002184
C .V B = × 100 = × 100 = 1.33%
X 0.1645
Since the C.V of sample B is more than that of A, sample B is more variable.

Example: (Variability using C.V) An analysis of the monthly salaries paid to

employees in two companies X and Y, belonging to the same industry, provides
the following results.

Company X Company Y
No. of employees 1200 1500
Average salary `12000 `9000
S.D `200 `225
Para 5.6 measures of variation 152

Find out:
1. Combined average monthly salary and combined S.D
2. The company having greater variability in individual salaries.
Solution: We are given that

X 1 = 12000, X 2 = 9000, N 1 = 1200, N 2 = 1500,s 1 = 200,s 2 = 225

N 1X 1 + N 2 X 2
X 12 =
N1 + N 2

120(12000) + 1500(9000)
=
1200 + 1500
= 10333
d1 = X 12 − X 1 = 10333 − 12000 =1667
d 2 = X 12 − X 2 = 10333 − 9000 = 1333

N1s 12 + N 2s 22 + N1d12 + N 2 d 22
s 12 = ,
N1 + N 2
1200(200)2 + 1500(225)2 + 1200(1667)2 + 1500(1333)2
=
1200 + 1500

6123937800
=
2700
= 2268125.11 = 1506.03
s1 200
(ii) C .V1 = × 100 = × 100 = 1.67%
X1 1200
s2 225
C .V2 = × 100 = × 100 = 2.5%
X2 9000

Since C.V of company Y is greater, therefore, company Y has greater variability.

Example: (Correcting variance and C.V) The mean and standard deviation of
100 items were found to be 60 and 10. If at the time of calculations, two items
were wrongly taken as 5 and 45 instead of 30 and 20, find the correct variance
and corrected coefficient of variation.
Solution: Since

X = 60,s x = 10,wrongX = 5,45, N = 100

153 Meaning of skewness Para 5.7

X =
∑X ⇒ ∑ X = N X = 100 × 60 = 6000
N
Then, corr ∑ X = 6000 − 5 − 45 + 30 + 20 = 6000

corr ∑ X 6000
corr X = = = 60
N 100
2
Also, s = ∑X − X
( )
2
x
N
Squaring both sides we get
2

s x2 =
∑X − X
( )
2

N
2

⇒ (10)2 =
∑X − ( 60 )
2

100

⇒ ∑ X 2 = 370000

corr ∑ X 2 = 370000 − (5)2 − (45)2 + (30)2 + (20)2 = 369250

corr ∑ X 2 2
Now , corr s x = − corr X
( )
N

369250 2
= − ( 60 )
100

= 3692.50 − 3600 = 9.62

2
∴ corr variance = s x2 = ( 9.62 ) = 92.5

corr s x 9.62
corr c.v= × 100 = × 100 = 16%
Corr X 60

5.7 Meaning of Skewness

Before discussing skewness, one must know about symmetrical distribution.
Symmetrical Distribution: A distribution is said to be symmetrical if mean,
median and mode are identical. It possesses a bell shaped curve as shown below:
Para 5.8 measures of variation 154

= Med Mode
Fig. 12.1 : Symmetrical distribution

If the distribution is not symmetrical, it is said to be skewed. Skewness means

lack of symmetry. It refers to departure from symmetry. A distribution in which
mean, median and mode are not identical is called asymmetrical or skewed.
The frequency curve of the distribution is not a symmetric bell-shaped curve
but it is more stretched to one side than to the other. Moreover, quartiles are
not equi-distant from the median. i.e., Q 3 − Median ≠ Median − Q1 .
Some definitions of skewness are as follows:
“When a series is not symmetrical, it is said to be skewed or asymmetrical.”
---Croxton and Cowden
“A distribution is said to be ‘skewed’ when the mean and median fall at dif-
ferent points in the distribution and the balance is shifted to one side or the
other – to left or right.” -----Garrett

5.8 Types of Skewness

Skewness is of the following types:
Positively Skewed Distribution: A distribution is said to be positively skewed if
mean is greater than mode and the median lies in between the two. Symbolically,
Mean > Median > Mode. It is also called a right- skewed distribution. The graph
of a positively skewed distribution is shown below.

M0 Med Mean

Fig. 12.2 : Positively skewed distribution

155 Measures of skewness Para 5.10

Negatively Skewed Distribution: A distribution is said to be negatively skewed if

mode is greater than mean and the median lies in between the two. Symbolically,
Mode > Median > Mean. It is also called a left- skewed distribution. The graph
of a negatively skewed distribution is shown below.

Mean ▼
M
Med 0

Fig. 12.3 : Negatively skewed distribution

5.10 Difference Between Variation and Skewness

Variation Skewness
1. The measures of variation tells 1. The measures of skewness tells us
us about the extent or amount of the nature of variation in the given
variation in the given data. data.
2. Variation is the degree to which 2. The measures of skewness indicate
the numerical data tends to spread the extent to which the distribution
about an average value. It gives the under consideration departs from
difference between the various items symmetry. The presence of extreme
about an appropriate average. They values on higher or lower end results
fail to reveal the extent to which these in positive or negative skewness
deviations are concentrated on the respectively.
higher or lower side of the average. 3. Measures of skewness consider the
3. Measures of variation are helpful difference between measures of
in judging the representativeness of central tendency and depends on
the measures of central tendency. them.

5.10 Measures of Skewness

Measures of skewness can be absolute or relative.
Absolute Measures of Skewness: It is given by
1. Absolute Sk = Mean – Mode
If the value of mean is greater than mode then skewness is positive. If the
value of mode is greater than that of mean, then we will get a negative
sign in the above formula and the distribution is negatively skewed.
2. Absolute Sk = Q 3 + Q1 − 2Median
Para 5.11 measures of variation 156

Relative Measures of Skewness

In this chapter, we will discuss the following important relative measures of
skewness.
u Karl Pearson’s Coefficient of skewness.
u Bowley’s Coefficient of Skewness.
u Kelly’s Coefficient of Skewness.
u Skewness based on moments.

5.11 Karl Pearson’s Coefficient of Skewness

It was suggested by Karl Pearson. Its value always lies between ±1. It is given by

Mean − Mode
SkP =
S .D
where SkP is Karl Pearson’s coefficient of skewness

Interpretation of Skp
u If SkP = 0, the distribution is symmetrical.
u If SkP> 0 , the distribution is positively skewed.
u If SkP< 0, the distribution is negatively skewed.
Skewness in case of ill-defined mode
In case of a bi-modal series, where the mode is ill-defined , mode is determined
by empirical formula. i.e.,
Mode = 3 Median – 2 mean.
Put this value of mode in the above defined formula of skewness, we get
Mean − (3Median − 2Mean )
SkP =
S .D
3(Mean − Median )
⇒ SkP =
S .D
Therefore, Karl Pearson’s Coefficient of Skewness in case of ill-defined mode
is given by :

3(Mean − Median )
SkP =
S .D
157 karl pearson’s coefficient of skewness Para 5.11

Example: (SkP in discrete series) Calculate Karl Pearson’s Coefficient of skewness

from the data given below:

X: 1 2 3 4 5 6 7
F: 10 18 30 25 12 3 2
Solution:
Computation of Karl Pearson’s Coefficient of Skewness

X f d = X −4 fd fd2 = fd × d

1 10 -3 -30 90
2 18 -2 -36 72
3 30 -1 -30 30
4 25 0 0 0
5 12 1 12 12
6 3 2 6 12
7 2 3 6 18
Total → 100 -72 234

Mean: X = A +
∑ fd =4−
72
= 3.28
∑f 100

2 2

S.D: s = ∑ fd  ∑ fd
−

 , d = X-a = X-4
∑f  ∑f
 
2
234  −72 
= −
100  100 
2
= 2.34 − ( −0.72 )

= 1.8216
= 1.35
Mode: Since the maximum frequency is 30, therefore the mode is 3
Mean − Mode
SkP =
S .D
3.28 − 3
=
1.35
= 0.208
Since SkP is positive, therefore the distribution is positively skewed.
Para 5.11 measures of variation 158

Example: (SkP in continuous series) Calculate Karl Pearson’s Coefficient of

skewness from the data given below:

X f
70-80 12
80-90 18
90-100 35
100-110 42
110-120 50
120-130 45
130-140 20
140-150 8
Solution:
Computation of Karl Pearson’s Coefficient of Skewness
Class intervals f Mid value X −A fu fu2 = fu × u
(X) u=
h
X − 105
u=
10
70-80 12 75 -3 -36 108
80-90 18 85 -2 -36 72
90-100 35 95 -1 -35 35
100-110 42 105 0 0 0
110-120 50 115 1 50 50
125 2 90 180
120-130 45
135 3 60 180
130-140 20
145 4 32 128
140-150 8
Total → 230 125 753

Mean: X = A +
∑ fu × h = 105 + 125 × 10 = 110.43
∑f 230

2 2

S.D: s =
∑ fu  ∑ fu 
− ×h
∑f  ∑ f 
 
2
753  125 
= − × 10
230  230 
2
= 3.27 − ( 0.54 ) × 10
159 karl pearson’s coefficient of skewness Para 5.11

= 2.9784 × 10
= 17.26
Mode: Since the maximum frequency is 50, therefore the modal class is 110-120
∆1 = fm − f1 = 50 − 42 = 8

∆ 2 = fm − f2 = 50 − 45 = 5
∆1
Mode = l + ×h
∆1 + ∆ 2
8
= 110 + × 10
8+5
= 116.15 = 116.15
Mean − Mode
SkP =
S .D
110.43 − 116.15
=
17.26
= 0.33
Since SkP is negative, therefore the distribution is negatively skewed.

Example: (SkP when mid-points are given) Calculate Karl Pearson’s Coefficient
of skewness from the data given below:

Central size: 40 35 30 25 20 15
Frequency: 21 20 24 25 18 12
Solution: Since we are given the mid-points, we first form the class intervals. The
class size is 5 so we add and subtract 2.5 from each mid-value.
Computation of Karl Pearson’s Coefficient of Skewness
Class intervals f Mid value (X) X −A fu fu2 = fu × u
u=
h
X − 25
u=
5
37.5-42.5 21 40 3 63 189
32.5-37.5 20 35 2 40 80
27.5-32.5 24 30 1 24 24
22.5-27.5 25 25 0 0 0
17.5-22.5 18 20 -1 -18 18
12.5-17.5 12 15 -2 -24 48
Total → 120 85 359
Para 5.11 measures of variation 160

Mean: X = A + ∑ fu × h = 25 + 85 × 5 = 28.542
∑f 120

2 2
S.D: s =
∑ fu  ∑ fu 
− ×h
∑f  ∑ f 
 
2
359  85 
= − ×5
120  120 
2
= 2.99 − ( 0.708 ) × 5

= 2.488736 × 5
= 7.89
Mode: We apply grouping method to determine the modal class.
Grouping Table
X F (column 1) Column 2 Column 3 C o l u m n Column 5 Column 6
4
37.5-42.5 21
21 +20 =41
32.5-37.5 20 21+20+
20 + 24=65
27.5-32.5 24 24 = 44 20+24+
24 +25 = 25=69
22.5-27.5 25 49 24+25+
18=67
17.5-22.5 18 25 +
18 = 43 25+18+
18 +12 = 12=55
12.5-17.5 12
30

Note: The values which are bold and underlined show the highest frequency
in each column.
Analysis table
Col. No. X 37.5-42.5 32.5-37.5 27.5-32.5 22.5-27.5 17.5-22.5 12.5-17.5
1 1
2 1 1
3 1 1
4 1 1 1
5 1 1 1
6 1 1 1
Total 1 3 5 4 1 0
161 karl pearson’s coefficient of skewness Para 5.11

It is clear from the analysis table that modal class is 27.5 – 32.5
∆1 = fm − f1 = 24 − 25 = 1
∆ 2 = fm − f2 = 24 − 20 = 4
∆1
Mode = l + ×h
∆1 + ∆ 2
1
= 27.5 + ×5
1+ 4
= 28.5
Mean − Mode
SkP =
S .D
28.542 − 28.5
=
7.89
= 0.005
Since SkP is positive, therefore the distribution is positively skewed.

Example: (SkP in bimodal series) Calculate Karl Pearson’s Coefficient of skewness

from the data given below:

Marks No. of students

Above 0 150
Above 10 140
Above 20 100
Above 30 80
Above 40 80
Above 50 70
Above 60 30
Above 70 14
Above 80 0
Solution: We first convert the given data in to continuous series by adjusting
the frequencies.
Para 5.11 measures of variation 162

Computation of Karl Pearson’s Coefficient of Skewness

Class intervals f Mid value (X) X −A fu fu2 = fu × u

u=
h
X − 35
u=
10
0-10 10 5 -3 -30 90
10-20 40 15 -2 -80 160
20-30 20 25 -1 -20 20
30-40 0 35 0 0 0
40-50 10 45 1 10 10
50-60 40 55 2 80 160
60-70 16 65 3 48 144
70-80 14 75 4 56 224
80-90 0 85 5 0 0
Total → 150 64 808

Mean: X = A + ∑ fu × h = 35 + 64 × 10 = 39.27
∑f 150

2 2

S.D: s =
∑ fu  ∑ fu 
− ×h
∑f  ∑ f 
 
2
808  64 
= − × 10
150  150 
2
= 5.387 − ( 0.426 ) × 10

= 22.8
Mode: Since the highest frequency is 40 which is occurring two times there-
fore it is a bi-modal series and the mode is said to be ill-defined. So, we first
calculate median.
N 150
Median: = = 75 . Looking this value or next higher to it in the c.f column ,
2 2
we get the median class as 40-50.
N
−c
Med = l + 2 ×h
f
75 − 70
= 40 + × 10
10
163 karl pearson’s coefficient of skewness Para 5.11

= 45
3(Mean − Median )
SkP =
S .D
3(39.27 − 45)
=
22.8
= 0.754
Since SkP is negative, therefore the distribution is negatively skewed.

Example: (SkP and missing frequency) The daily expenditure of 100 families is
given below:

Daily expenditure: 0-20 20-40 40-60 60-80 80-100

No. of families: 13 ? 27 ? 16
If mode of the distribution is 44, calculate the Karl Pearson’s coefficient of
skewness.

Solution: We first find the missing frequencies. Let the missing frequencies be
x and y.
Since mode is 44 which lies in the class interval 40-60, therefore the modal
class is 40-60. Then fm = 27, f1 = x, f2 = y
∆1 = fm − f1 = 27 − x
∆ 2 = fm − f2 = 27 − y
∆1
Mode = l + ×h
∆1 + ∆ 2
27 − x
44 = 40 + × 20
27 − x + 27 − y
44 − 40 27 − x
⇒
20
=
54 − x − y
⇒ 54 − x − y = 135 − 5x
⇒ 4x − y = 81 .........(i)
Also 13 +x +27 +y +16 = 100
⇒ x + y = 44 .........(ii)
Solving (i) and (ii), we get x = 25 and y =19
Para 5.11 measures of variation 164

Computation of mean and S.D

Class intervals f Mid value (X) X −A fu fu2 = fu

u= ×u
h
X − 50
u=
20
0-20 13 10 -2 -26 52
20-40 25 30 -1 -25 25
40-60 27 50 0 0 0
60-80 19 70 1 19 19
80-100 16 90 2 32 64

Total → 100 0 160

Mean: X = A + ∑ fu × h = 50 + 0 × 20 = 50
∑f 100

2 2

S.D: s =
∑ fu  ∑ fu 
− ×h
∑f  ∑ f 
 
2
160  0 
= − × 20
100  100 
2
= 1.6 − ( 0 ) × 20

= 1.26 × 20
= 25.2
Mean − Mode 50 − 44
SkP = = = 0.238
S .D 25.2

Example: Calculate mode and median from the given information. Karl Pearson’s
coefficient of skewness = 0.32, S.D = 6.5, Mean = 29.6
Solution: We are given that S.D = 6.5, Mean = 29.6, Skp = 0.32
Mean − Mode
We know that SkP =
S .D
29.6 − Mode
⇒ 0.32 =
6.5
⇒ Mode = 27.52
165 karl pearson’s coefficient of skewness Para 5.11

Also, Mode = 3med − 2mean

⇒ 27.52 = 3med − 2(29.6)
⇒ median = 28.9

Example: From a moderately skewed distribution of retail prices for men’s

shirts it is found that the mean price is `200 and median price is `170. If the
coefficient of variation is 20%, find the Pearsonian coefficient of skewness of
the distribution.
Solution: It is given that mean = 200, median = 170, C.V = 20%
S .D
C .V = × 100
Mean
S .D
20 = × 100
200
⇒ S .D = 40
3(Mean − Median ) 3(200 − 170)
SkP = = = 2.25
S .D 40

Example: Pearson’s coefficient of skewness for a data distribution is 0.5 and

coefficient of variation is 40%. Its mode is 80. Find mean and median of the
distribution. Also find the S.D.
Solution: We are given that C.V = 40%, Skp = 0.5, mode = 80
S .D
C .V = × 100
Mean
S .D
⇒ 40 = × 100
Mean
⇒ S .D = 0.4mean
Mean − Mode
We know that SkP =
S .D
mean − Mode
⇒ 0.5 =
0.4mean
⇒ 0.2mean = mean − 80
⇒ Mean = 100
Then S .D = 0.4 × 100 = 40
Also Mode = 3median – 2mean
⇒ 80 = 3med − 2(100)
⇒ med = 93.3
Para 5.11 measures of variation 166

Example: From a group of 20 items, ∑X = 1452, ∑ X 2 = 144280, Mode = 63.7 .

Find Pearson’s coefficient of skewness.

Solution: Mean =
∑X =
1452
n 20
2

S .D =
∑X − X
( )
2

144280 2
= − ( 72.6 )
20

= 7214 − 5270.76
= 44.08
Mean − Mode
SkP =
S .D
72.6 − 36.7
= = 0.202
44.08
Example: The following data gives information about the situation of a industry
before and after settlement of dispute.

Before settlement After settlement

No. of workers 516 508
Mean wages 4950 5175
Median wages 5270 5000
S.D 1000 1210
Comment upon the situation of the industry before and after dispute in terms
of total wages, modal wages, coefficient of variation and skewness.
Solution: Total wages:

Before settlement: X =
∑X ⇒ ∑ X = nX = 516 × 4950 = `25,54,200
n
After settlement: Total wages = 508 × 5175 = `26,28,900
Modal wages:
Before settlement: Mode = 3Median – 2Mean = 3(5270) – 2(4950) = `5910

After settlement: Mode = 3(5000) – 2(5175) = `4650

s 1000
C.V before settlement = × 100 = × 100 = 20.2%
X 4950
167 Bowley’s coefficient of skewness Para 5.12

s 1210
C.V after settlement = × 100 = × 100 = 23.28%
X 5175

Before settlement: SkP = 3(Mean − Median ) = 3(4950 − 5270) = −0.96

S .D 1000
After settlement: Sk = 3(Mean − Median ) = 3(5175 − 5000) = 0.44
P
S .D 1210
Interpretation: The total wages has gone up after the settlement of dispute
even though the number of workers has reduced from 516 to 508. This shows
that the average wage is now higher. This is definitely a gain to the workers.
Median wages before settlement of dispute was 5270 and after settlemt , it is
5000. This shows that formerly 50% of workers used to get wages above `5270
and now they get only above `5000. The skewness is negative before dispute
and it is positive after dispute. This indicates greater piling up of the frequencies
on the left side which means greater number of persons is on the lower scale
of wages. At the same time, the variation in wages has increased after dispute.
It means that wages are less uniformly distributed after settlement of dispute.

5.12 Bowley’s Coefficient of Skewness

It is a relative measure of skewness based on quartiles. It is denoted by SkB
and is given by:

Q 3 + Q1 − 2Median
SK B
Q 3 − Q1

Example: (SkB in discrete series) Calculate Bowley’s coefficient of skewness

from the following data:

Marks: 10 20 30 40 50 60
No. of students: 4 7 15 8 7 2
Solution:
Computation of SkB

Marks No. of students (f) c.f

10 4 4
20 7 11
30 15 26
40 8 34
50 7 41
60 2 43
Para 5.12 measures of variation 168

Lower quartile:
 n +1  43 + 1 
r = 1  = 11
 4   4 


Look this value or next higher to it in the c.f column, we get Q1 = 20

Upper quartile:
 n +1  43 + 1 
r = 3  = 33
 4   4 


Look this value or next higher to it in the c.f column, we get Q3 = 50

 n + 1   43 + 1 
Median:  =  = 22
 2   2 
Look this value or next higher to it in the c.f column, we get Median = 30
Q 3 + Q1 − 2Median
SK B
Q 3 − Q1
40 + 20 − 2(30)
= =0
40 − 20
Since the coefficient of skewness is zero, it is a symmetrical distribution.

Example: (SkB in continuous series) Calculate Bowley’s coefficient of skewness

from the following data:

Income per day (in `) More than: 40 50 60 70 80 90

No. of workers: 186 167 132 84 38 12
Solution: We first convert the given data in to continuous series by adjusting
the frequencies.
Computation of SkB

Marks No. of students (f) c.f

40-50 19 19
50-60 35 54
60-70 48 102
70-80 46 148
80-90 26 174
90-100 12 186
Lower quartile:
rn 1(186)
= = 46.5 .
4 4
169 Bowley’s coefficient of skewness Para 5.12

Look this value or next higher to it in the c.f column, we get the lower quartile
class as 50 –60
rn
−c
Qr = l + 4 ×h
f
46.5 − 19
Q1 = 50 + × 10 = 57.85
35
Upper quartile:
rn 3(186)
= = 139.5 .
4 4
Look this value or next higher to it in the c.f column, we get the upper quartile
class as 70 – 80
rn
−c
Qr = l + 4 ×h
f

139.5 − 102
Q 3 = 70 + × 10 = 78.15
46

n (186)
Median: = = 93 .
2 2
Look this value or next higher to it in the c.f column, we get the median class
as 60-70
n
−c
Med = l + 2 ×h
f

93 − 54
Med = 60 + × 10 = 68.12
48
Q 3 + Q1 − 2Median
SK B
Q 3 − Q1
78.15 + 57.85 − 2(68.12)
= = −0.012
78.15 − 57.85
Since the coefficient of skewness is negative, it is a negatively skewed distribution.

Example: Find the coefficient of skewness and values of two quartiles from the
following information.
Difference of two quartiles = 8, Mode = 11, Mean = 8, sum of two quartiles =22
Solution: We are given that Q 3 − Q1 = 8, Mode = 11, Mean = 8,Q 3 + Q1 = 22
Solving Q 3 − Q1 = 8 and Q 3 + Q1 = 22 , we get Q 3 = 15 and Q1 = 7
Para 5.12 measures of variation 170

Also Mode = 3median – 2mean

⇒ 11 = 3median − 2(8)
⇒ Median = 9
Q 3 + Q1 − 2Median
SK B
Q 3 − Q1
22 − 2(9)
= = 0.5
8
Example: The mean, mode and quartile deviation of a distribution are 42, 36 and
15 respectively. If its Bowley’s coefficient of skewness is 1/3, find the values
of the two quartiles.
Solution: We are given that mean = 42, mode = 36, Q.D = 15, SkB = 1/3
Q − Q1
Q .D = 15 ⇒ 3 = 15 ⇒ Q 3 − Q1 = 30 ........(i)
2
Also, Mode = 3median – 2mean
⇒ 36 = 3med − 2(42)
⇒ med = 40
Q 3 + Q1 − 2Median
SK B
Q 3 − Q1
1 Q 3 + Q1 − 2(40)
⇒ =
3 Q 3 − Q1
⇒ Q 3 + Q1 = 90 ......(ii)

Solving (i) and (ii), we get

Q 3 − Q1 588.76 − 249.91
Q .D = = = 169.425
2 2
Example: (Comprehensive)You are given the following data:

Wages (`) % of households

Below 100 7.2
100-119 11.7
200-299 12.1
300-399 14.8
400-499 15.9
500-599 14.9
600-699 10.4
700-999 9.0
1000 and above 4.0
171 Bowley’s coefficient of skewness Para 5.12

(a) What are the problem involved in the determination of standard deviation
from the given data?
(b) Find a suitable measure of dispersion.
(c) Would the skewness of the above distribution be affected if the income
of everyone was increased by a certain proportion.
Solution: (a) The given data is an open-end distribution. So there is a need to make
an assumption about the lower limit of the first class interval and upper limit
of the last class interval otherwise standard deviation could not be calculated.
(b) Suitable measure of dispersion is quartile deviation because it is based on
quartiles which is a positional average and we know that positional averages
are the best measures in case of open-end distributions. Moreover the class
intervals are unequal in size. In case of positional averages, there is no need to
make the class intervals equal.
Computation of quartile deviation

Wages (`) Class intervals % of households(f) c.f

Below 100 Below 100 7.2 7.2
100-119 99.5-19.5 11.7 18.9
200-299 119.5-299.5 12.1 31.0
300-399 299.5-399.5 14.8 45.8
400-499 399.5-499.5 15.9 61.7
500-599 499.5-599.5 14.9 76.6
600-699 599.5-699.5 10.4 87.0
700-999 699.5-999.5 9.0 96.0
1000 and above 999.5 and above 4.0 100.0
Lower quartile:
rn 1(100)
= = 25 .
4 4
Look this value or next higher to it in the c.f column, we get the lower quartile
class as 199.5-299.5
rn
−c
Qr = l + 4 ×h
f
25 − 18.9
Q1 = 199.5 + × 100 = 249.91
12.1
Upper quartile:
rn 3(100)
= = 75 .
4 4
Para 5.13 measures of variation 172

Look this value or next higher to it in the c.f column, we get the upper quartile
class as 499.5-599.5
rn
−c
Qr = l + 4 ×h
f

75 − 61.7
Q 3 = 499.5 + × 100 = 588.76
14.9
Q 3 − Q1 588.76 − 249.91
Q .D = = = 169.425
2 2
(c) If the income of everyone is increased by a certain proportion, the skewness
would not be affected.

5.13 Kurtosis
Kurtosis is a Greek word which means bulginess. It refers to the degree of
flatness or peakedness in the region about the mode of a frequency curve.
The degree of flatness or peakedness is measured relative to the normal curve.
Types of Kurtosis
(a) Leptokurtic curve: If a curve is more peaked than the normal curve, it is
called lepto-kurtic curve.
(b) Platykurtic curve: If a curve is less peaked than the normal curve, it is
called platy-kurtic curve.
(c) Mesokurtic curve: The normal curve itself is called meso-kurtic curve.

Leptokurtic curve
▼

Mesokurtic curve
▼

Platykurtic curve
▼

Fig.12.4 :
173 Objective type questions

OBJECTIVE TYPE QUESTIONS

Q1. The coefficient of range in data set: 8,10,20,9,15,10,13,28 is
(a) 28 (b) 8 (c) 20 (d) 0.55
Q2. Range in data set: 8,10,20,9,15,10,13,28 is
(a) 28 (b) 8 (c) 20 (d) 0.55
Q3. Coefficient of range in data set: 30, 32, 49, 39, 33, 35, 42, 50 is:
(a) 0.25 (b) 50
(c) 20 (d) cannot be determined
Q4. Semi- interquartile range is given by :
Q 3 − Q1 Q 3 + Q1 Q − Q1
(a) (b) (c) 3 (d) none
Q 3 + Q1 Q 3 − Q1 2
Q5. If Q 3 = 79.17,Q1 = 53.44 then coefficient of quartile deviation is :
(a) 25.73 (b) 12.865 (c) 0.19 (d) none
Q6. The value of 3rddecile in the data: 10, 15, 16, 5, 18, 11, 9, 25, 19, 23, 17, 13, 22,
8, 26, 7, 12, 24, 28 is :
(a) 6 (b) 11 (c) 16 (d) none
Q7. It is given that mean of 20,15,19,24,16,14 is 18. The value of standard deviation
is :
(a) 18 (b) 11.67 (c) 3.42 (d) none
Q8. In Q7.above, the variance is :
(a) 18 (b) 11.67 (c) 3.42 (d) none
Q.9 The range of 7, 18, 5, 13, 12, 14 is:
(a) 18 (b) 14 (c) 4 (d) none
Q10. X: 1 2 3 4 5
F: 2 8 12 8 1

Range in the above discrete series is :

(a) 4 (b) 12 (c) 8 (d) none
Q11. Variable: 10-20 20-30 30-40 40-60 60-80
Frequency: 2 8 16 5 2

Range in the above continuous series is:

(a) 70 (b) 10 (c) 80 (d) none
Q12. Find the inter-quartile range and quartile deviation from the data given below:

Marks: 20-30 30-40 40-50 50-60 60-70 70-80 80-90

No. of students: 4 12 18 28 19 14 5
 measures of variation 174

(a) 21.84, 10.92 (b) 10.92,21.84 (c) 21.84,21.84 (d) none

Q13. Find the value of quartile deviation from the data given below:

Roll no. 1 2 3 4 5 6 7
Marks: 20 28 40 12 30 15 50
(a) 40 (b) 15 (c) 12.5 (d) none

Q14. Marks: 10 20 30 40 50 60
No. of students: 4 7 15 8 7 2

The coefficient of quartile deviation from the data given above is:
(a) 0.33 (b) 20 (c) 10 (d) none
Q15. Marks: 0-10 10-20 20-30 30-40 40-50 50-60 60-70 70-80
No. of students: 10 40 20 0 10 40 16 14

The inter-quartile range and the coefficient of quartile deviation of the data
given above is:
(a) 41.25, 0.65 (b) 41.25,0.55 (c) 0.55,41.25 (d) none
Q16. Marks (More than): 0 10 20 30 40
No. of students: 60 55 48 28 8

From the data given above, quartile deviation is :

(a) 7.5 (b) 21.5 (c) 36.5 (d) none

Q17. X: 10 11 12 13 14
F: 3 12 18 12 3

The semi-interquartile range and its coefficient is:

(a) 1, 0.08 (b) 0.08,1 (c) 1,1 (d) none
Q18. Marks: 0-10 10-20 20-30 30-40 40-50 50-60 60-70 70-80
No. of students: 5 8 12 15 20 14 12 6
Quartile deviation of the above data is:
(a) 28.33 (b) 56.43 (c) 14.05 (d) none
Q19. Variable: 0-15 15-30 30-45 45-60 60-75 75-90 90-105
Frequency: 8 26 30 45 20 17 4
Then interquartile range and quartile deviation is:
(a) 15.44, 30.875 (b) 30.875,15.44 (c) 0.33, 30.875 (d) none
Q20. Quartile deviation from the data given below is :
175 Objective type questions

Income less 50-70 70-90 90-110 110-130 130-150 above

(in `): than 50 150

No. of 54 100 140 300 230 125 51

workers:
(a) 19.925 (b) 19.2 (c) 20 (d) none
Q21. The value of upper quartile if lower quartile is 104 and quartile deviation is 18 is :
(a) 68 (b) 140 (c) 20 (d) 36

Q22. Wages: 0-10 10-20 20-30 30-40 40-50

No. of workers: 22 38 46 35 20
The coefficient of quartile deviation is :
(a) 0.4 (b) 0.396 (c) 0.2 (d) none
Q23. Variable: 5-10 10-15 15-20 20-25 25-30 30-35
Frequency: 2 9 29 54 11 5
Standard deviation is:
(a) 4.188 (b) 4.2 (c) 4.881 (d) none
Q24. X: 5 15 25 35 45 55 65
F: 5 12 30 45 50 37 21

Standard deviation is:

(a) 14.839 (b) 1.4839 (c) 15 (d) none
Q25. Compute standard deviation from the data given below:

Variable: 0-10 10-20 20-30 30-40 40-50 50-60 60-70 70-80

Frequency: 10 40 20 0 10 40 16 14
(a) 2.28 (b) 22.8 (c) 22 (d) none
Q26. Standard deviation of the data: 43,48, 65, 57, 31, 60, 37, 48, 78, 59 is:
(a) 17.6 (b) 13.26 (c) 1.326 (d) none

Q27. Profit (in 000 `): 20-30 30-40 40-50 50-60 60-70 70-80 80-90 90-100
No. of Cos. : 30 58 62 85 112 70 57 26
Standard deviation from the above data is
(a) 17.18 (b) 18.71 (c) 18.17 (d) 1.871

Q28. Age: 20-25 25-30 30-35 35-40 40-45 45-50

No. of workers: 170 110 80 45 40 35
Standard deviation from the above data is:
(a) 7.935 (b) 39.675 (c) 3.967 (d) none
 measures of variation 176

Q29. If quartile deviation of a group is 16, the most likely value of variance of that
group is:
(a) 24 (b) 576 (c) 10.66 (d) none
Q30. Mean and standard deviation of 100 items were found to be 50 and 0.1. If at
the time of calculations, two items were wrongly taken as 40 and 50 instead
of 60 and 30, then the correct mean and correct standard deviation are:
(a) 2.0025,50 (b) 50,2.0025 (c) 50,20.025 (d) none
Q31. The mean and variance of a set of 5 values are 9 and 31.2, respectively. If three
of these values are 2, 5 and 12, then the remaining two are:
(a) 18,8 (b) 8,28 (c) 18,18 (d) none
Q32. An analysis of the results of a budget survey of 150 families showed an average
weekly expenditure on food items to be `120 with a S.D of `15. After the analysis
was completed, it was noticed that the figure recorded for one household was
wrongly taken as `5 instead of `105. Then the corrected values of the mean
and S.D. are :
(a) 120.6, 12.35 (b) 12.35,120.6 (c) 123.5, 12.06 (d) none

Q33. For a group of 100 items, the A.M and S.D are 8 and 10.5 . For 50 observations
selected from these 100 observations, mean and S.D are 10 and 2 respectively.
Then mean and S.D of the remaining 50 observations are:
(a) 6,3 (b) 3,6 (c) 6,6 (d) none
Q34. The mean and S.D of marks obtained by 40 students of a class in Statistics are
55 and 8 respectively. If there are only 5 girls in the class and their respective
marks are 40, 55, 63 , 75 and 87, then mean and S.D of the marks obtained by
the boys are:
(a) 53.7, 4.73 (b) 5.37,47.3 (c) 4.73,53.7 (d) none
Q35. Find the missing information.

Item GroupI GroupII GroupIII Combined

Number 50 ? 90 200
Variance 36 49 ? 60
Mean 113 ? 115 116
(a) 60,120,60 (b) 60,64,100 (c) 60,64,120 (d) none
Q36. The following are the scores of Sachin and Yuvraj.

Sachin : 12 115 76 42 7 19 49 80
Yuvraj: 47 12 76 73 24 51 63 54
Which of the two is a more consistent batsman?
(a) Sachin (b) Yuvraj
(c) both are same (d) can’t say
177 Objective type questions

Q37. Share prices of two companies A Ltd. and B Ltd. were recorded as follows:

A Ltd. 12 13 15 14 14 14 13 17
B Ltd. 113 114 113 115 117 114 112 114
Which company’s share prices were more variable?
(a) A (b) B (c) can’t say (d) both are same
Q38. The runs scored by two batsmen A and B in nine consecutive matches are
given below:

A: 8 20 62 28 74 5 69 4 13
B: 72 4 15 30 59 15 49 27 26
Who is more consistent amongst A and B?
(a) A (b) B
(c) A and B both are equally consistent (d) can’t say

Q39. A set of 50 numbers has mean and S.D equal to X and s respectively. If each
of the values of the set is multiplied by 45, the coefficient of variation becomes
25% while if each value of the set is increased by 45, the C.V becomes 16%.
Then the values of X and s is:
(a) 80,20 (b) 20,80 (c) 8,20 (d) 20,8
Q 40. Verify the correctness of the following statement:
A batsman scored at an average of 60 runs an inning against Pakistan. The S.D
of the runs scored by him was 12. A year later against Australia, his average
came down to 50 runs an inning and the S.D of the runs scored fell down to 9.
Which of the following statement is correct to say regarding his performance.
(a) performance was worse against Australia and that there was lesser
consistency in his batting against Australia.
(b) performance was worse against Pakistan and that there was lesser
consistency in his batting against Australia.
(c) performance was worst against Australia and that there was more
consistency in his batting against Australia.
(d) performance was worse against Pakistan and that there was more
consistency in his batting against Australia.
Q41. The number of employees, wages per employee and the variance of the wages
of employees for two factories are given below:

Factory A Factory B
No. of employees 50 100
Average wages per employee per month 1200 850
Variance of the wages (`) 81 256
 measures of variation 178

(i) In which factory, is there greater variation in the distribution of wages per
employee?
(a) B (b) A
(c) Both are same (d) Can’t say
Q42. An analysis of the monthly salaries paid to employees in two companies A and
B, belonging to the same industry, provides the following results.

Company A Company B
No. of employees 100 200
Average salary `1600 `1800
S.D `16 `18
Which firm shows greater uniformity in the distribution of salary?
(a) A (b) B
(c) both have same uniformity (d) can’t say
Q43. An analysis of the monthly wages paid to workers in two firms A and B provides
the following results.

Firm A Firm B
No. of wage earners 55 65
Average monthly wages `5000 `4500
Variance of wages `81 `100
Find out:
1. Which firm pays larger amount as monthly wages?

2. Which firm shows greater variability in individual wages?

(a) B,B (b) A,B (c) B,A (d) A,A

Q44. X: 3.5 4.5 5.5 6.5 7.5 8.5 9.5

F: 3 7 22 60 85 32 8

Karl Pearson’s coefficient of skewnessis :

(a) 0.357 (b) -0.357 (c) 1 (d) none
Q45. A survey of sales made by 230 firms in light engineering goods industry during
the year 2012 revealed the following information:
179 Objective type questions

Sales (in lakhs of `) No. of firms

70-80 12
80-90 18
90-100 35
100-110 42
110-120 50
120-130 45
130-140 20
140-150 8
Calculate Karl Pearson’s coefficient of skewness using (a) Mean and Mode (b)
Mean and Median
(a) -0.33, -0.20 (b) -0.20, -0.33 (c) -0.33, -0.33 (d) -0.2, -0.2
Q46. Karl Pearson’s coefficient of skewness of the data is:
X: 12.5 17.5 22.5 27.5 32.5 37.5 42.5 47.5
F:
28 42 54 108 129 61 45 33

(a) 0.228 (b) -0.228 (c) 0.282 (d) -0.282

Q47. Marks: 20-30 30-40 40-50 50-60 60-70 70-80 80-90 above90
No. of students: 5 12 15 20 18 10 6 4
Karl Pearson’s coefficient of skewness from the above data is:
(a) 0.008 (b) 1 (c) -0.008 (d) -0.08
Q48. Profit(` in Cr.)less than: 20 30 40 50 60 70
No. of companies: 5 22 48 60 83 100
Karl Pearson’s coefficient of skewness from the above data is:
(a) 0.0617 (b) 1 (c) 0.617 (d) -0.67

Q49. Age(in yrs): 20-25 25-30 30-35 35-40 40-45 45-50 50-55 55-60
No. of persons: 50 70 80 180 150 120 70 50
Karl Pearson’s coefficient of skewness from the above data is:
(a) 0.239 (b) 1 (c) 0.29 (d) -0.239
Q50. Calculate Karl Pearson’s coefficient of skewness from the following data.
 measures of variation 180

Weekly salary (in `) Number of salesmen

400 but less than 600 4
600 but less than 800 10
800 but less than 1000 19
1000 but less than 1200 12
1200 but less than 1400 4
1400 but less than 1600 1
(a) 0.34 (b) -0.34 (c) 0.034 (d) none
Q51. For a distribution, n = 20, Karl Pearson’s coefficient of skewness based on
median = -0.84 and coefficient of variation = 40%. The sum of squares of the
values is 14500. Then mode and median are:
(a) 33.4, 25 (b) 33.4, 27.8 (c) 27.8,33.4 (d) none
Q52. Given below is information about two distributions:

Distribution A Distribution B
Mean 126 112
Median 128.5 110.6
S.D 15 14
(i) Which distribution has higher degree of variation?
(ii) Which distribution has higher degree of skewness?
(a) B,A (b) A,B (c) A,A (d) B,B
Q53. Calculate Karl Pearson’s coefficient of skewness from the following data.

Variable: 70-80 60-70 50-60 40-50 30-40 20-30 10-20 0-10

Frequency: 18 22 30 35 21 11 6 5
(a) 0.457 (b) - 0.457 (c) 0.0457 (d) - 0.0457
Q54. Marks: 35-36 36-37 37-38 38-39 40-41 41-42 42-43
No. of students: 14 20 42 54 45 21 8
Bowley’s coefficient of skewness is:
(a) 0.037 (b) 0.307 (c) -0.037 (d) none
Q55. Calculate Bowley’s coefficient of skewness from the following data:

Variable: 0-10 10-20 20-30 30-40 40-50 50-60 60-70 70-80 80-90
Frequency: 6 16 20 36 20 10 6 4 2
(a) 1 (b) 0 (c) -1 (d) none
Q56. Calculate Bowley’s coefficient of skewness from the following data:
181 Objective type questions

Variable: 70-80 80-90 90-100 100-110 110-120 120-130 130-140 140-150

Frequency: 12 18 35 42 50 45 20 8
(a) -0.07 (b) 0.07 (c) 0.007 (d) none
Q57. For a distribution, Bowley’s coefficient of skewness = -1/3, median = 56,
value of third quartile is three times the value of first quartile. Then quartile
coefficient of dispersion is:
(a) 0.1 (b) 0.5 (c) -0.5 (d) none
Q58. Calculate Bowley’s coefficient of skewness from the following data:

No. of children per family: 0 1 2 3 4 5 6

No. of families: 7 10 16 25 18 11 8
(a) 1 (b) 0 (c) 0.5 (d) none
Q59. Calculate Bowley’s coefficient of skewness from the following data:

Income in ` No. of persons

3000-4000 14
4000-5000 46
5000-6000 58
6000-7000 76
7000-8000 68
8000-9000 62
9000-10000 48
10000-11000 22
11000-12000 6
(a) 0.43 (b) 0.043 (c) -0.043 (d) none
Q.60 Calculate Bowley’s coefficient of skewness from the following data:

Income in ` No. of persons

Below 2000 25
2000-4000 40
4000-6000 80
6000-8000 75
8000-10000 20
Above 10000 16
(a) -0.016 (b) 0 (c) 1 (d) 0.016
Q61. The value of lower quartile =18, upper quartile = 25, mode = 21, mean =18.
Then the coefficient of skewness is :
(a) -0.714 (b) 0.714
(c) can’t be determined (d) 1
 measures of variation 182

Q62. For a distribution, Bowley’s coefficient of skewness is 0.56, Q1 = 16.4 and

median = 24.2. Then the coefficient of quartile deviation is:
(a) 0.5 (b) 0.486 (c) 0.468 (d) none
Q63. In a frequency distribution, coefficient of skewness based on quartiles is 0.6.
If the sum of upper and lower quartile is 100 and median is 38, find the values
of lower and upper quartile.
(a) 30,70 (b) 40,60 (c) 20,80 (d) none
Q64. Variance is independent of change of:
(a) Origin only (b) scale only
(c) both origin and scale (d) none
Q65. If the S.D of a variate X is s ,then the S.D of a X+b is :
(a) a s (b) s (c) as (d) as + b
Q66. The variance of first n natural numbers is :
(n + 1)(2n + 1) 2 2
(a) (b) (n − 1) (c) (n + 1) (d) none
6 12 12
Q67. mean ± 3s covers____________items.
(a) 90% (b) 93.37% (c) 99.73% (d) none
Q68. Quartile deviation is :
2 4 3
(a) s (b) s . (c) s (d) none
3 5 2
Q69. The sum of 10 items is 12 and the sum of their squares is 18. Therefore, S.D
is :
(a) 0.6 (b) 0.36
(c) can’t be determined (d) none
Q70. In a symmetric distribution, the upper and lower quartiles are equidistant
from ____
(a) Mean (b) median (c) mode (d) none
Q71. ______________is a Greek word which means bulginess.
(a) Skewness (b) kurtosis (c) variation (d) none
Q72. If a curve is more peaked than the normal curve it is then called:
(a) Platykurtic (b) leptokurtic (c) mesokurtic (d) skewed.

FILL IN THE BLANKS

1. ____________divides the distribution into ten equal parts.
2. ____________ divides the distribution into hundred equal parts.
3. ____________is the value in a ranked data set such that one fourth of the
measurements are below this value and three fourth are above it.
183 Fill in the blanks

4. ________are the fractiles that divide a ranked data set into four equal parts.
5. Second quartile is the same as _____ that divides a ranked data set into two
equal parts.
6. If 25% of the items are less than 10 and 25% of the items are more than 40,
then the coefficient of quartile deviation is ________
7. If the mean, mode and S.D of a frequency distribution are 41, 45 and 8
respectively, then its coefficient of skewness is ______
8. In a series, the coefficient of variation is 20 and mean is 40, then S.D is
____________
9. Q.D is _____________of S.D
10. If in a series, C.V is 50, S.D is 20 then mean is _____________
11. The degree to which the numerical data tends to spread about an average
value is called__________
12. _______measure of variation are those measures of variation which are
expressed in the same statistical unit in which the original data is given.
13. Ratio of an absolute measure of variation to an appropriate average is called
_________.
14. ______________ is the range between the quartiles.
15. ______________gives the range of the middle 50% of the values.
16. ______________is also called quartile deviation.
17. Quartile deviation is ___________ measure of variation.
18. _____________is obtained by dividing the quartile deviation by one-half of the
summation of the values of the upper and lower quartiles.
19. Inter percentile range is given by_____________
20. ___________ is defined as the positive square root of the average of squared
deviations taken from the arithmetic mean.
21. Standard deviation is also called ______________.
22. S.D is an___________ measure of variation.
23. If each value in a given series is increased (decreased) by a constant k, the
standard deviation is ___________.
24. If each value in a given series is multiplied (divided) by a constant, k, the
standard deviation of the new series would be _______ by absolute value of
the constant.
25. Mean ± σ covers __________of the items.
26. Mean ± 2σ covers _________ of the items
27. Mean ±3σ covers__________ of the items.
28. When all the observations are equal, standard deviation is_____.
29. Standard deviation of two numbers is half of ________________
 measures of variation 184

30. _____________defined as the average of the squared deviations measured from

the arithmetic mean.
31. ___________is the square of standard deviation.
32. If each value in a given series is multiplied (divided) by a constant, k, the
variance of the new series would be equal to variance of the given series ______
33. Coefficient of variation is a ________measure of variation. It was given by
_______.
34. The series for which coefficient of variation is __________ will be more variable.
35. __________is used to compare the variability of two or more series.
36. A distribution is said to be symmetrical if mean, median and mode are ______.
37. __________ possesses a bell shaped curve.
38. ______ means lack of symmetry.
39. ____________ is a Greek word which means bulginess.
40. ________ refers to the degree of flatness or peakedness in the region about the
mode of a frequency curve.
41. The degree of flatness or peakedness is measured relative to the____________.
42. If a curve is less peaked than the normal curve, it is called _____________ curve.
43. Normal curve is __________curve in terms of kurtosis.

TRUE/FALSE
1. Median is equidistant between the upper quartile and the lower quartile.
2. In a positively skewed distribution, the value of mode is greater than the mean.
3. Range is the best measure of dispersion.
4. The sum of the squares of deviations measured from mean is least.
5. Every symmetrical distribution is unimodal.
6. The coefficient of skewness is one when the distribution is symmetrical.
7. Absolute measure of variation can be used for purpose of comparison.
8. S.D can be calculated from any average.
9. Karl Pearson coefficient of skewness is based on quartiles.
10. Dispersion is a measure of the extent to which the individual items vary.
11. Absolute measure of variation are those measures of variation which are
expressed in the same statistical unit in which the original data is given.
12. Relative measure of variation is a pure number.
13. Relative measure of variation can be used for comparing two or more sets of
data when they involve different variables.
14. Coefficients of dispersion are absolute measures.
15. Range is a relative measure of variation.
185 Answers to objective type questions

16. A distribution is said to be negatively skewed if mode is greater than mean

and the median lies in between the two.
17. The measures of skewness tells us the nature of variation in the given data.
18. The measures of dispersion tells us about the exact amount of variation in the
given data.
19. Mean – Mode is the relative measure of skewness.
20. If SkP = 0, the distribution is symmetrical.
21. If SkP> 0, the distribution is negatively skewed.
22. Kurtosis is a Greek word which means bulginess.
23. If a curve is more peaked than the normal curve, it is called lepto-kurtic curve.

ANSWERS TO OBJECTIVE TYPE QUESTIONS

A1. (a) 0.55
L − S 28 − 8
Coefficient of Range = = = 0.55
L + S 28 + 8
A2. (c) 20
Range = L – S = 28 – 8 =20
A3. (a) 0.25
L − S 50 − 30
COR = = = 0.25
L + S 50 + 30
Q 3 − Q1
A4. (c)
2
A5. (c) 0.19
Q − Q1 79.17 − 53.44
COQ = 3 = = 0.19
Q 3 + Q1 79.17 + 53.44

A6. (a) 6
Arranging the data in ascending order, we get
5, 7, 8, 9, 10, 11, 12, 13, 15, 16, 17, 18, 19, 22, 23, 24, 25, 26, 28
th th
3(n + 1) 3(19 + 1)
D 3 = size of item = item =6th item = 11
10 10
A7. (c) 3.42
 measures of variation 186

X
(X − X) (X − X) 2
20 2 4
15 -3 9
19 1 1
24 6 36
16 -2 4
14 -4 16
Total = 108 70

2

s =
∑ (X − X ) =
70
= 3.42
n 6

A8. (b) 11.67

2 2
Variance = s = (3.42) = 11.67
A9. (c) 4
Range = L – S = 18 – 14 = 4
A10. (a) 4
Range = 5 -1 = 4
A11. (a) 70
Range = 80-10 = 70
A12. (a) 21.84,10.92
Computation of quartile deviation and its coefficient

Marks No. of students(f) c.f

20-30 4 4
30-40 12 16
40-50 18 34
50-60 28 62
60-70 19 81
70-80 14 95
80-90 5 100
Lower quartile:
rn 1(100)
= = 25 .
4 4
Look this value or next higher to it in the c.f column, we get the lower quartile
class as 40-50
187 Answers to objective type questions

rn
−c 25 − 16

Qr = l + 4 ×h ⇒ Q1 = 40 + × 10 = 45
f 18

Upper quartile:
rn 3(100)
= = 75 .
4 4
Look this value or next higher to it in the c.f column, we get the upper quartile
class as 60 –70
rn
−c
Qr = l + 4
×h
f

75 − 62
Q 3 = 60 +
× 10 = 66.84
19
Interquartile range = Q3 – Q1 =66.84 – 45 = 21.84
Q 3 − Q1 66.84 − 45
Q .D =
= = 10.92
2 2
A13. (c) 12.5
Arranging the data in ascending order, we get 12, 15, 20, 28, 30, 40, 50
th th
n +1  7 +1 nd
Q1 = size of 
4  item =  4  item = 2 item = 15
   
th th
n +1  7 +1 th
Q 3 = size of 3 
 item = 3  4  item = 6 item = 40
 4   
Q 3 − Q1 40 − 15
QD =
= = 12.5
2 2
A14. (a) 0.33
Computation of coefficient of Q.D

X f c.f
10 4 4
20 7 11
30 15 26
40 8 34
50 7 41
60 2 43
n=43
 measures of variation 188

Lower quartile:
 n +1  43 + 1 

r  = 1 4  = 11
 4   
Look this value or next higher to it in the c.f column, we get Q1 = 20
Upper quartile:
 n +1  43 + 1 
r
 = 3  4  = 33
 4   
Look this value or next higher to it in the c.f column, we get Q3 = 40
Q 3 − Q1 40 − 20

CQD = = = 0.33
Q 3 + Q1 40 + 20

A15. (b) IQR = 41.25, CQD = 0.55

A16. (a) 7.5
Lower quartile = 21.5, upper quartile = 36.5 marks, Q.D = 7.5 marks
A17. (a) 1, 0.08
Computation of Semi IQR and its coefficient

X f c.f
10 3 3
11 12 15
12 18 33
13 12 45
14 3 48

n=48
Lower quartile:
 n +1  48 + 1 

r = 1  = 12.25
 4   4 


Look this value or next higher to it in the c.f column, we get Q1 = 11

Upper quartile:
n +1  48 + 1 
r
 = 3  4  = 36.75
 4   
Look this value or next higher to it in the c.f column, we get Q3 = 13
Q 3 − Q1 Q −Q 13 − 11
Semi − IQR =
= 1; CQD = 3
= 1
= 0.08
2 Q +Q
3
13 + 11
1

A18 (c)14.05
189 Answers to objective type questions

Computation of quartile deviation

Marks No.of students(f) c.f

0-10 5 5
10-20 8 13
20-30 12 25
30-40 15 40
40-50 20 60
50-60 14 74
60-70 12 86
70-80 6 92
Lower quartile:
rn 1(92)
= = 23 .
4 4
Look this value or next higher to it in the c.f column, we get the lower quartile
class as 40-50
rn
−c
23 − 13
Qr = l + 4
×h ⇒ Q1 = 20 + × 10 = 28.33
f 12
Upper quartile:
rn 3(92)
= = 69 .
4 4
Look this value or next higher to it in the c.f column, we get the upper quartile
class as 50 –60
rn
−c
Qr = l + 4
×h
f
69 60
= 50 + × 10 = 56.43
14
Q 3 − Q1 56.43 − 28.33

Q .D = = = 14.05
2 2
A19. (b) IQR = 30.875, Q.D = 15.44
A20. (a) Q.D = 19.925
A21. (b) 140
Q 3 − Q1 Q − 104

Q .D = ⇒ 18= 3 ⇒ Q 3 = 140
2 2
A22. (b) CQD = 0.396
A23. (c) 4.881
 measures of variation 190

Solution: Computation of Standard deviation

Variable Midpoint f m − 17.5 fu fu2

(m) u=
5
5-10 7.5 2 -2 -4 8
10-15 12.5 9 -1 -9 9
15-20 17.5 29 0 0 0
20-25 22.5 54 1 54 54
25-30 27.5 11 2 22 44
30-35 32.5 5 3 15 45

Total 110 78 160

2 2

s =
∑ fu  ∑ fu 
− × h ,where u =
m − 17.5
∑f  ∑ f  5
 
2
160  78 

= − × 5 = 4.881
110  110 
A24. (a) 14.839
2
Take assumed mean as A = 35, h = 10. Then ∑ fu = 118, ∑ fu = 510, ∑ f = 200
2 2 2

s =
∑ fu  ∑ fu 
− ×h =
510  118 
− × 10 = 14.839
∑f  ∑ f  200  200 
 
A25. (b) 22.8
A26. (b) 13.26
Computation of standard deviation

X d= X - 52 d2
43 -9 81
48 -4 16
65 13 169
57 5 25
31 -21 441
60 8 64
37 -15 225
48 -4 16
78 26 676
59 7 49
Total=526 6 1762
191 Answers to objective type questions

2 2 2

s =

∑d  ∑d
−

 =
1762  6 
−   = 13.26
n  n
  10  10 
A27. (b) 18.71
A28. (a) 7.935
A29. (b) 576
2 2 2

Q .D = s ⇒ 16= s ⇒ s = 24 ⇒ var = ( 24 ) = 576
3 3
A30 (b) 50,2.0025

corr ∑ X = 5000 − 40 − 50 + 60 + 30 = 5000

corr ∑ X 5000
corr X =
= = 50
n 100
2
Also, s = ∑X 2

− X
2
⇒ s x2 =
∑X − X
( )
2

x
N
( ) N

⇒ (0.1)2 =
∑ X 2 − ( 50 )2 ⇒ ∑ X 2 = 250001
100

corr ∑ X 2 = 250001 − (40)2 − (50)2 + (60)2 + (30)2 = 250401

2 250401
Now , corr s = corr ∑ X − corr X 2 2
= − ( 50 ) = 2.0025
x
N
( ) 100
A31 (a) 18,8
A32. (a) 120.6 , 12.35
A33 (a) 6,3
N 1X 1 + N 2 X 2 50(10) + 50(X 2 )

X 12 = ⇒8= ⇒ X2 = 6
N1 + N 2 100

d1 = X 12 − X 1 = 8 − 10 =2

d 2 = X 12 − X 2 = 8 − 6 = 2

N 1s 12 + N 2s 22 + N 1d12 + N 2d 22

s 12 = ,
N1 + N 2

50(4)2 + 50(s 2 )2 + 50(2)2 + 50(2)2

⇒ 10.5 =
100

⇒ s 22 = 9 ⇒s2 = 3
A34 (a) mean = 53.7, S.D = 4.73
A35. (c) 60,64,120
50 + N 2 + 90 = 200
⇒ N 2 = 60
 measures of variation 192

X 123 = 116, N 1 = 50, N 2 = 60, N 3 = 90, X 1 = 113, X 2 = ?, X 3 = 115

50(113) + 60X 2 + 90(115)

116 = ⇒ X 2 = 120
200
d1 = 3, d 2 = 4, d 3 = 1

50(6)2 + 60(7)2 + 90 s 32 + 50(3)2 + 60(4)2 + 90(1)2

( )

⇒ 7.746 =
200
⇒s3 = 8

Therefore, N2 = 60, Variance of 3rd group = 64, mean of 2nd group = 120
A36. (b) Yuvraj.
Mean of Sachin = 50, S.D of Sachin = 35.57; C.V of Sachin = 71.14%,
Mean of Yuvraj =50; S.D of Yuvraj = 20.98; C.V of Yuvraj = 41.96%, Yuvraj is
a more consistent batsman.
A37. (a) A
2

XA =
112
= 14,s A =
∑ (X − X ) =
16
= 1.414,C .VA =
1.414
× 100 = 10.10%
8 n 8 14
2

912
XB = = 114,s B =
∑ (X − X ) =
16
= 1.414,C .V B =
1.414
× 100 = 1.24%
8 n 8 114

C.V of A Ltd. is more than that of B, therefore, prices of A Ltd. are more
variable.
A38. (b) B
Mean of A and B are 40 and 33 resp. S.D of A and B are 30.37 and 21.18 resp.
C.V of A = 75.93% and C.V of B is 64.18% resp. B is more consistent.
A39. (a) 80,20
When each value is multiplied by 45 then mean and S.D both get multiplied
by 45.
s 45s
Then C .V = × 100 ⇒ 25 = × 100 s = 0.25X
X 45X
When each value is increased by 45 then mean get increased by 45 but S.D
remains same.
s s
Then C .V = × 100 ⇒ 16 = × 100 ⇒ 0.16(45 + X ) = s
X 45 + X
Solving, we get mean = 80, S.D = 20
A40. (c)
Against Pakistan: C.V = 20%; Against Australia: C.V = 18%; more consistency
against Australia; average runs were more against Pakistan so performance
was good against Pakistan but worst against Australia.
193 Answers to objective type questions

A41. (a) B
C.V of factory A = 0.75% , C.V of factory B = 1.88%; greater variation in B.
A42. (c)
C.V(A)= C.V(B) = 1%, it means both companies have same uniformity.
A43. (a) B,B
(1) Firm B (2) C.V (A)= 0.18%, C.V (B) = 0.22%, B has greater variability.
A44. (b) -0.357
2
Take A = 6.5 then d = X-6.5; ∑ fd = 128; ∑ fd = 362, ∑ f = 217

X =A+

∑ fd = 6.5 +
128
= 7.09
∑f 217

2 2 2

s =

∑ fd  ∑ fd
−

 =
362  128 
− = 1.149
∑f  ∑f
  217  217 

Mode = 7.5 by inspection, SkP = -0.357

A45. (a) -0.33, -0.20
Mean = 110.43, Mode = 116.15, Median = 111.6, S.D = 17.26, (a) Skp = -0.33
(b) Skp = -0.20
A46. (b)-0.228
Mean = 30.46, mode = 32.5, S.D = 8.96, Skp = -0.228
A47. (c) -0.008
Mean = 57, mode = 57.14, S.D = 17.66, Skp = -0.008
A48. (c) 0.617
Mean = 43.2, mode = 33.91, S.D = 15.06, Skp = 0.617
A49. (d) -0.239
Mean = 40.29, mode = 42.5, S.D = 9.24, Skp = -0.239
A50. (c) 0.034
Mean = 920, mode = 912.5, S.D = 223.61, Skp = 0.034
A51. (b) 33.4, 27.8
s
20,
n= C . v = 40 = × 100 ⇒ s = 0.4X
X
2

s =
∑X 2
− X
( )
2
⇒ (0.4X )2 =
14500
− X
( )
2
⇒ X = 25
n 20

⇒ s = 25 × 0.4 = 10

3(mean − median ) 3(25 − median )
SK P =
⇒ -0.84= ⇒ med=27.8
s 10
mod e = 3median − 2mean = 3(27.8) − 2(25) = 33.4

 measures of variation 194

A52. (a) B,A

(i) C.VA = 11.9%, C.VB = 12.5%, C.V of B is higher so B is more variable. (ii)
SKp(A) = -0.5, SkP (B) = 0.3. Absolute value of SkP of A is higher than that of
B therefore degree of skewness is higher for A. Remember that sign of Skp
gives the direction of skewness only.
A53. (c) 0.0457
Mean = 48.18, S.D = 17.7, Mode = 47.37, Skp = 0.0457
A54. (b) 0.307
Lower quartile = 37.405, upper quartile = 40.511, Median = 38.48, SkB = 0.307
A55. (b) 0
Lower quartile = 24, upper quartile = 46, Median = 35, SkB = 0.
A56. (a) -0.07
Lower quartile = 97.86, upper quartile = 123.44, Median = 111.6, SkB = - 0.07
A57. (b) 0.5
Lower quartile = 24, Third quartile = 72, Coefficient of quartile deviation =
0.5
A58. (b) 0
Lower quartile = 2, upper quartile = 4, Median = 3, SkB = 0
A59. (b) 0.043
Lower quartile = 5689.7, upper quartile = 8612.90, Median = 7088.2, SkB =
0.043
A60. (d) 0.016
Lower quartile = 3950, upper quartile = 8612.90, Median = 7253.33, SkB =
0.016
A61. (b) 0.714
Median = 19, SkB= 0.714
A62. (b) 0.486
Lower quartile = 16.4, upper quartile =47.43, CQD = 0.486
A63. (a) 30,70
Lower quartile = 30 and upper quartile = 70
A64. (a) Origin only
A65. (a)
This is because S.D is independent of change of origin but not of scale.
2
A66. (b) (n − 1)
12
A67. (c) 99.73%
2
A68 (a) s
3
195 Answers to objective type questions

A69. (a) 0.6

2 2 2

n = 10, ∑ X = 10, ∑ X 2 = 18 ⇒ s =

∑X  ∑X 
− =
18  10 
− = 0.6
n  n  10  10 
 
A70. (b) median
A71. (b) Kurtosis
A72. (b) leptokurtic

ANSWERS TO FILL IN THE BLANKS

1. Deciles
2. Percentiles
3. Lower quartile
4. Quartiles
5. Median
40 − 10
6. 0.6 because Q1 = 10,Q 3 = 40 ⇒ CQD = = 0.6
40 + 10
7. -1/2
s s
8. 8 because × 100 = 20 ⇒ × 100 = 20 ⇒s =8
mean 40
9. 2/3
20
10. 40 because × 100 = 50 ⇒ mean = 40
mean
11. variation or dispersion
12. Absolute
13. Relative measure of dispersion.
14. Interquartile range
15. Interquartile range
16. Semi interquartile range
17. Absolute
18. Coefficient of quartile deviation
19. P90 – P10
20. Standard deviation
21. root-mean –squared –deviations
22. absolute
23. unaffected
24. multiplied (divided)
25. 68.27%
 measures of variation 196

26. 95.4%
27. 99.7%
28. Zero
29. Range
30. Variance
31. Variance
32. multiplied (divided) by k2.
33. Relative, Karl Pearson
34. Greater
35. C.V
36. Identical
37. Symmetrical distribution.
38. Skewness
39. Kurtosis
40. Kurtosis
41. Normal curve
42. Platykurtic
43. mesokurtic

ANSWERS TO TRUE/FALSE
1. True
2. False. Mean is greater than mode
3. False. Range is the rough measure of dispersion.
4. True
5. True
6. False . In a symmetrical distribution, coefficient of skewness is zero.
7. False. Relative measure of dispersion is used for comparison.
8. False. S.D is calculated only from mean.
9. False. Bowley’s coefficient is based on quartiles.
10. True
11. True
12. True
13. True
14. False
15. False. Range is an absolute measure.
16. True
197 Answers to true/false

17. True.
18. True
19. False.
20. True
21. False. It is negatively skewed
22. True
23. True
 C H A P T E R

6 Measurement of Scale

Learning Objectives
u Define and distinguish among nominal, ordinal, interval, and ratio scales
of measurement.
u Identify a scale type

6. 1 Introduction
In this chapter, we will discuss various scales of measurement like nominal
scale, ordinal scale, ratio scale, interval scale. We will identify a scale type
under different cases.

6.2 Levels of measurement

What a scale actually means and what we can do with it depends on what its
numbers represent. Numbers can be grouped into 4 types or levels: nominal,
ordinal, interval, and ratio. Nominal is the most simple, and ratio the most
sophisticated. Each level possesses the characteristics of the preceding level,
plus an additional quality.

6.3 Different Scales of Measurements

Nominal Scale
Nominal is hardly measurement. It refers to quality more than quantity. A
nominal level of measurement is simply a matter of distinguishing by name,
e.g., 1 = male, 2 = female. Even though we are using the numbers 1 and 2, they
do not denote quantity. The binary category of 0 and 1 used for computers is a
nominal level of measurement. They are categories or classifications. Nominal
measurement is like using categorical levels of variables, described in the doing
198
199 Different scales of measurement Para 6.3

scientific research section of the Introduction module. Nominal scales are used
for labelling variables, without any quantitative value. “Nominal” scales could
simply be called “labels.” The essential point about nominal scales is that they
do not imply any ordering among the responses. For example, when classifying
people according to their favourite colour, there is no sense in which green
is placed “ahead of” blue. Responses are merely categorized. Nominal scales
embody the lowest level of measurement. Examples of nominal scale are:
What is your gender- Male or female
Where do you live- North Delhi, South Delhi, East Delhi, West Delhi
What is your hair colour? Black, brown, white, blonde, other

Ordinal Scale
Ordinal refers to order in measurement. An ordinal scale indicates direction,
in addition to providing nominal information. Low/Medium/High; or Faster/
Slower are examples of ordinal levels of measurement. Ranking an experience
as a “nine” on a scale of 1 to 10 tells us that it was higher than an experience
ranked as a “six.” Many psychological scales or inventories are at the ordinal
level of measurement.
A researcher wishing to measure consumers’ satisfaction with their microwave
ovens might ask them to specify their feelings as either “very dissatisfied,”
“somewhat dissatisfied,” “somewhat satisfied,” or “very satisfied.” The items in
this scale are ordered, ranging from least to most satisfied. This is what dis-
tinguishes ordinal from nominal scales. Unlike nominal scales, ordinal scales
allow comparisons of the degree to which two subjects possess the dependent
variable. For example, our satisfaction ordering makes it meaningful to assert
that one person is more satisfied than another with their microwave ovens.
Such an assertion reflects the first person’s use of a verbal label that comes
later in the list than the label chosen by the second person.
Examples:
RANK: 1st place, 2nd place, ... last place
LEVEL OF AGREEMENT: No, Maybe, Yes
POLITICAL ORIENTATION: Left, Center, Right

Night Dawn Noon Afternoon Evening

Ordinal time of day - indicates direction or order of occurrence; spacing be-
tween is uneven.

Interval Scale:
Interval scales are numerical scales in which intervals have the same inter-
pretation throughout.Interval scales provide information about order, and
Para 6.3 Measurement of scale 200

also possess equal intervals. An example of an interval scale is temperature,

either measured on a Fahrenheit or Celsius scale. A degree represents the
same underlying amount of heat, regardless of where it occurs on the scale.
Measured in Fahrenheit units, the difference between a temperature of 46 and
42 is the same as the difference between 72 and 68. Equal-interval scales of
measurement can be devised for opinions and attitudes. Constructing them
involves an understanding of mathematical and statistical principles beyond
those covered in this course. But it is important to understand the different
levels of measurement when using and interpreting scales.Interval scales are
not perfect, however. In particular, they do not have a true zero point even if
one of the scaled values happens to carry the name “zero.” The Fahrenheit scale
illustrates the issue. Zero degrees Fahrenheit does not represent the complete
absence of temperature (the absence of any molecular kinetic energy).
Examples:
TIME OF DAY on a 12-hour clock
POLITICAL ORIENTATION: Score on standardized scale of political orientation.
OTHER scales constructed so as to possess equal intervals.

12 1 2 3 4 5 6 7 8 9 10 11 12 1 2 3 4 5 6 7 8 9 10 11 12
Interval time of day - equal intervals; analog (12-hr.) clock, difference be-
tween 1 and 2 pm is same as difference between 11 and 12 am.

Ratio Scale
The ratio scale of measurement is the most informative scale. It is an interval
scale with the additional property that its zero position indicates the absence of
the quantity being measured. You can think of a ratio scale as the three earlier
scales rolled up in one. Like a nominal scale, it provides a name or category
for each object (the numbers serve as labels). Like an ordinal scale, the objects
are ordered (in terms of the ordering of the numbers). Like an interval scale,
the same difference at two places on the scale has the same meaning. And in
addition, the same ratio at two places on the scale also carries the same mean-
ing. The Fahrenheit scale for temperature has an arbitrary zero point and is
therefore not a ratio scale. However, zero on the Kelvin scale is absolute zero.
This makes the Kelvin scale a ratio scale. For example, if one temperature is
twice as high as another as measured on the Kelvin scale, then it has twice the
kinetic energy of the other temperature.
In addition to possessing the qualities of nominal, ordinal, and interval scales,
a ratio scale has an absolute zero (a point where none of the quality being
measured exists). Using a ratio scale permits comparisons such as being twice
as high, or one-half as much. Reaction time (how long it takes to respond to
a signal of some sort) uses a ratio scale of measurement -- time. Although an
individual’s reaction time is always greater than zero, we conceptualize a zero
201 objective type questions

point in time, and can state that a response of 24 milliseconds is twice as fast
as a response time of 48 milliseconds.
Examples:
RULER: inches or centimeters YEARS of work experience
INCOME: money earned last year NUMBER of children
GPA: grade point average

0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24
Ratio - 24-hr. time has an absolute 0 (midnight); 14 o’clock is twice as long
from midnight as 7 o’clock

OBJECTIVE TYPE QUESTIONS

Q1. Identify the scale of measurement for military titles- lieutenant, captain, major.
(a) Nominal (b) ordinal (c) interval (d) ratio
Q2. Identify the scale of measurement for categorization of clothing: hat, shirt,
shoes, pants
(a) nominal (b) ordinal (c) interval (d) ratio
Q3. Identify the scale of measurement for heat measured in degrees centigrade.
(a) Nominal (b) ordinal (c) interval (d) ratio
Q4. A score of five point quiz measuring knowledge of algebra is an example of
what scale.
(a) Nominal (b) ordinal (c) interval (d) ratio
Q5. City of birth is an example of which scale of measurement.
(a) Nominal (b) ordinal (c) interval (d) ratio
Q6. There is a debate about the value of computing means for :
(a) Ordinal data (b) Interval data
(c) Nominal data (d) Ratio data
Q7. Gender is an example of which scale of measurement.
(a) Nominal (b) ordinal (c) interval (d) ratio
Q8. Hair color is an example of which scale of measurement.
(a) Nominal (b) ordinal (c) interval (d) ratio
Q9. How do you feel today: very unhappy, unhappy, OK, happy, very happy. It is
an example of which scale of measurement.
(a) Nominal (b) ordinal (c) interval (d) ratio
 Measurement of scale 202

Q10. How satisfied are you with our services: very unsatisfied, somewhat unsatisfied,
neutral, somewhat satisfied, very satisfied is an example of which scale of
measurement.
(a) Nominal (b) ordinal (c) interval (d) ratio
Q11. What was your CGPA in class XII: 3.5 - 4.0, 3.0 – 3.49, 2.5 – 2.99, 2.0 – 2.49. It
is an example of which scale of measurement.
(a) Nominal (b) ordinal (c) interval (d) ratio
Q12. Following is an example of which type of scale?
Sales operations engineering HR marketing
(a) nominal (b) ordinal (c) interval (d) ratio
Q13. Following is an example of which scale of measurement?
1st 2nd 3rd 4th 5th 6th
(a) nominal (b) ordinal (c) interval (d) ratio
Q14. Following is an example of which scale of measurement?
0 – 99 100 – 199 200 – 299 300-399 400 – 499 500 - 599
(a) nominal (b) ordinal (c) interval (d) ratio
Q15. How many hours a day do you spend on a computer is an example of which
type of scale measurement?
(a) nominal (b) ordinal (c) interval (d) ratio
Q16 The nominal level of measurement is represented in which variable below?
(a) Fear of crime (b) temperature
(c) income (d) gender
Q17. The order in which participants complete a task is an example of what level
of measurement?
(a) nominal (b) ordinal (c) interval (d) ratio
Q18. What level of measurement would be used if participants were asked to
choose their favourite picture from a set of six?
(a) nominal (b) ordinal (c) interval (d) ratio
Q19. We can multiply and divide values in :
(a) Interval and ratio scales (b) Ratio and nominal scales
(c) Interval and nominal scales (d) Interval and ordinal scales
Q20. Which scale has a true zero?
(a) Nominal (b) ordinal (c) interval (d) ratio
Q21. Which scale is equidistant between each of the scale elements?
(a) Nominal (b) ordinal (c) interval (d) ratio
203 objective type questions

Q22. Which level of measurement is required for median?

(a) Nominal (b) ordinal (c) interval (d) ratio
Q23. Which level of measurement is required for mode?
(a) Nominal (b) ordinal (c) interval (d) ratio
Q24. The teacher of a class of third graders records the height of each student. It
is an example of what scale of measurement?
(a) Nominal (b) ordinal (c) interval (d) ratio
Q25. The teacher of a class of third graders records the eye colour of each student.
It is an example of what scale of measurement?
(a) Nominal (b) ordinal (c) interval (d) ratio
Q26. The teacher of a class of third graders records the letter grade for Mathematics
for each student. It is an example of what scale of measurement?
(a) Nominal (b) ordinal (c) interval (d) ratio
Q27. The teacher of a class of third graders records the percentage that each
student got correct on the last science test. It is an example of what scale of
measurement?
(a) Nominal (b) ordinal (c) interval (d) ratio
Q28. A meteorologist compiles a list of temperature in degrees Celsius for the month
of March. It is an example of what scale of measurement?
(a) Nominal (b) ordinal (c) interval (d) ratio
Q29. A meteorologist compiles a list of temperature in degrees Kelvin for the month
of August. It is an example of what scale of measurement?
(a) Nominal (b) ordinal (c) interval (d) ratio
Q30. A film critic lists the top 50 greatest movies of all time. It is an example of what
scale of measurement?
(a) Nominal (b) ordinal (c) interval (d) ratio
Q31. A car magazine lists the most expensive cars for the year 2015? It is an example
of what scale of measurement?
(a) Nominal (b) ordinal (c) interval (d) ratio
Q32. The roster of a basketball team lists the jersey numbers for each of the players.
It is an example of what scale of measurement?
(a) Nominal (b) ordinal (c) interval (d) ratio
Q33. A local animal shelter keeps track of the breeds of dogs that come in. It is an
example of what scale of measurement?
(a) Nominal (b) ordinal (c) interval (d) ratio
Q34. A local animal shelter keeps track of weight of dogs that come in. It is an
example of what scale of measurement?
(a) Nominal (b) ordinal (c) interval (d) ratio
 Measurement of scale 204

ANSWERS TO OBJECTIVE TYPE QUESTIONS

A1. (b) ordinal
A2. (a) nominal
A3 (c) Interval
A4 (b) ordinal
A5 (a) nominal
A6 (a) ordinal data
A7 (a) nominal
A8 (a) nominal
A9 (b) ordinal
A10 (b) ordinal
A11. (c) interval
A12. (a) nominal
A13. (b) ordinal
A14. (c) interval
A15. (d) Ratio scale
A16. (d) gender
A17. (b) ordinal
A18. (a) nominal
A19. (a) Interval and ratio scales
A20. (d) ratio
A21. (c) interval
A22. (b) ordinal. (as the data for median must be ranked or ordered)
A23. (a) nominal (as we can find mode for any level of measurement.)
A24. (d) ratio. (There is a starting point (0 feet, 0 inch) and it makes sense to say
that 6 feet is twice as long as 3 feet.)
A25. (a) nominal (as eye colour is not a number)
A26. (b) ordinal (The letter grade can be ordered with A as high and C as low)
A27. (d) Ratio (The number have a range from 0% to 100% and it makes sense to
say that one score is a multiple of another.
A28. (c) Interval scale. Temperature can be ordered and we look at difference in
temperature)
A29. (d) Ratio scale. (As kelvin scale doe have an absolute zero point from which
we can reference all other temperatures. The zero for Fahrenheit and Celsius
scales is not the same as we can have negative temperature with these scales.
A30. (b) ordinal. (The rankings are ordered from 1 to 50 but there is no way to
compare the difference in rankings. Movie 1 could beat movie 2 only a little
205 Answers to objective type questions

or it can be superior in critic’s eye. There is no way to know from rankings

above)
A31. (d) Ratio (As prices can be compared at ratio level of measurement)
A32. (a) nominal (even though there are numbers associated with this data set,
the number serves as alternate forms of names for the players. Ordering the
jersey makes no sense and there is no reason to do any arithmetic with these
numbers.
A33. (a) Nominal (because the dog breeds are not numeric.)
A34. (d) Ratio (zero pounds is the starting point for all weights and it makes sense
to say that the 5 pound dog is one quarter the weight of a 20 pound dog)
 C H A P T E R

7 Set Theory

Learning Objectives
By the end of this chapter, you will be able to understand:
u Meaning of a set
u Representations of sets
u Types of sets
u Operations on Sets
u Venn diagrams
u Cartesian Product of sets

7.1 Introduction
In this chapter, we will discuss meaning of set through various illustrations.
Then we explain various types of sets and operations on sets through venn
diagrams.

7.2 Meaning of a set

Set: A set is a collection of well-defined distinct objects. Each object is called
an element or a member of the set. We usually denote sets by capital letters
A, B, C, D, etc., and their elements by small letters a, b, c, d, etc.
e.g: A = {1, 2, 3, 4, 5} is a set of natural numbers less than or equal to 5.
B = {3, 6, 9, 12, 15} is a set of multiples of 3 which are less than or equal to15.
C = {2, 3, 7} is the set of the prime factors of 42.
D = {Jan., Mar., May, Jul., Aug., Oct., Dec.} is a set of all months in a year that
contain 31 days.
206
207 Types of sets Para 7.4

The order of the elements does not matter, therefore the sets {1, 2, 3, 4, 5} and
{1, 4, 3, 5, 2} are the same.
Note:
1. The members of a set are usually called elements. In A = {1, 2, 3, 4, 5}, 1
is an element of set A, therefore we write 1 ∈ A i.e. 1 belongs to A. But 6
is not an element of A = {1, 2, 3, 4, 5}, therefore we write 6 ∉ A. i.e. 6 does
not belong to A.
2. A collection of rich persons is not a set because it is not well defined.
Instead, if we take a collection of millionaires then it is a set.

7.3 Representation of Sets:

1. Roster form : In this form the list of the elements separated by commas
are enclosed in the brackets {}
e.g. A = {1, 2, 3, 4, 5}
B = {1, 2, 3, 4, 5…………….} is the set of all natural numbers, it has infinite
elements.
2. Set Builder form or Rule Method : If all the elements of a set A satisfy a
certain property P, then the set is written as A = {x : x satisfies properties P}.
It is read as, A is the set of all elements x such that x satisfies the property
P.
e.g. In the above example , A = {1, 2, 3, 4, 5} can be written in Set Builder
form as
A = {x : x is a natural number less than 6} Or
A = { x : x ∈ N, x < 6 }

7.4 Types of Sets:

1. Empty Set or Null Set or Void Set : A set which does contain any element
is called an empty set. It is denoted by φ or { }.
e.g. The set A = {x : x is a natural number less than 1} is an empty set
because there is no natural number less than 1.
Please note that the set {0} is not an empty set because ‘0’ is an element
of the set. Similarly, the set {φ} is also not an empty set because φ is an
element of the set.
2. Singleton Set : A set containing only one element is called a singleton set.
e.g. {∆} is a singleton set, whose only element is ∆.
3. Finite Set : An empty set or a set containing a finite number of elements
is called a finite set. The number of elements in a finite set is called the
Para 7.4 set theory 208

cardinal number. e.g. The set A = {1, 2, 3, 4} is a finite set, cardinal number
4. The set of months in a year is a finite set, cardinal number 12.
4. Infinite Set : A set containing an infinite number of elements is called
an infinite set. For example, The set of natural numbers = A = {1, 2, 3,
4…………} is an infinite set. The set of all the points on a line is an infinite
set. The set of rational numbers is an infinite set.
5. Equal Sets : Two sets A and B are said to be equal if every element of A is
in B and every element of B is in A. Equal sets are written as A = B. For
example, the sets A = {1, 2, 3, 4, 5} and B = {1, 4, 3, 5, 2} are equal sets.
6. Equivalent Sets : Two sets A and B are said to be equivalent, if they have the
same number of elements, i.e. their cardinal Numbers are equal, i.e. n(A)
= n(B).e.g. The sets A = {1, 2, 3, 4, 5} and B = {a, b, c, d, e} are equivalent
sets as both have 5 elements.
Subset : If A and B are two sets such that every element of A is also an

element of B then A is called the subset of B, (represented as A ⊆ B) and
B is called the superset of A (represented as B ⊇ A)
Proper Subset : If A is a subset of B, but not equal to B then it is called
the proper subset of B, (represented as A ⊂ B) and B is called the proper
superset of A, (represented as B ⊃ A).
Note:
1. The symbols ⊆ and ⊂ in sets are analogous to the symbols ≤ and < in
arithmetic.
2. Every set is a subset of itself, i.e. A ⊆ A.
3. The null set is a subset of all sets, i.e. φ ⊆ A.
4. If a set A has n elements, then total number of proper subsets is 2n – 1
Illustrations based on definition of sets:
I-1. A collection of intelligent students is not a set, because it is not well defined.
But if we take a collection of students which have an I.Q. greater than
120 then it is well defined and it can form a set.
I-2. A collection of the best football players of the world is not a set, because
it is not well defined. But if we take a collection of football players who
have scored more than 10 goals in a year then it is well defined and it can
form a set.
I-3. The set of letters of the word MATHEMATICS is {M, A, T, H, E, I, C, S}
because the set should have all distinct elements, so we take the repeated
letters as one element only.
I-4. The set of letters of the word MISSISSIPPI is {M, I, S, P} because the set
should have all distinct elements, so we take the repeated letters as one
element only.
209 Types of sets Para 7.4

Illustrations based on representation of sets:

I-5. Convert the set, A = {a, e, i, o, u} into set builder form.
Solution: A = {x : x is a vowel}
I-6. Convert the set, A = {1, 2, 3, 4, …..} into set builder form.
Solution: A = {x : x is a natural number} OR A = {x : x ∈ N}
I-7. Convert the set, A is a set of integers between – 15 and 15 into set builder
form.
Solution: A = {x: – 15 < x < 15, where x is an integer}
I-8. Convert the set A = {x: x is a month having 30 days} in roster form.
Solution: A = {April, June, September, November}
I-9. Convert the set A = {x: x is a positive integer, x2 < 12} in roster form.
Solution: 12=1, 22=4, 32=9, 42=16
Therefore x = 1, 2, 3 satisfy the above condition
Hence, A = {1, 2, 3}
Universal Set : A set which is the superset of all the given sets is called
the Universal Set. It is represented by U.
e.g. if A = the set of natural numbers and B = the set of rational numbers
and C = the set of integers, then U = the set of real numbers is the superset
of A, B and C and it will the universal set w.r.t. the sets A, B and C.
Power Set : The collection of all possible subsets of a given set A is called
the power set of A, it is denoted by P(A).
e.g. If A = {1, 2, 3} then P(A) = {{1, 2, 3}, {1, 2}, {1, 3}, {2, 3}, {1}, {2}, {3}, Ø }
Illustrations based on subsets and number of subsets:
I-10. What is the number of all possible subsets of the set A = {a, b, c}
Solution: Since the set has 3 elements, The number of subsets is 23 = 8.
I-11. If set A = {1, 2, 3} then what is the power set of A?
Solution: The power set of A is the set of all subsets of A. It is given by :
P(A) = {Ø, {1}, {2}, {3}, {1, 2}, {1, 3}, {2, 3}, {1, 2, 3}}
Venn Diagrams : The geometric figures used to explain the concepts of
sets and the operations on sets are called venn diagrams.
U

A
fig. 7.1
Para 7.5 set theory 210

For example the above figure shows a universal set U represented by a rect-
angular region and its subset A is represented by a circular shaded region.
The non-shaded region inside the rectangle, represents complement of A.

7.5 Operations on Sets:

1. Union of Sets : The union of two sets A and B is represented as A ∪ B, it is
read as “A union B”.A ∪ B is the set of all elements that are either in set A or
in set B.It is represented by the shaded region in the following Venn Diagram.
U

A A

fig. 7.2

For example if U = {0, 1, 2, 3, 4, 5, 6, 7, 8, 9}

A = {0, 2, 4, 6, 8} and B = {1, 2, 3, 4, 5} Then A ∪ B = {0, 1, 2, 3, 4, 5, 6, 8}
2. Intersection of Sets : The inter-section of two sets A and B is represented as
A ∩ B, it is read as “A intersection B”.
A ∩ B is the set of all elements that are present in both the sets A and B. For
example, if U = {0, 1, 2, 3, 4, 5, 6, 7, 8, 9}
A = {0, 2, 4, 6, 8} and B = {1, 2, 3, 4, 5} Then A ∩ B = {2, 4}.
It can be represented by the following Venn diagram.
U

A B

fig. 7.3

If A ∩ B = Ø, i.e. if they don’t have any common element then they are called
Disjoint sets. Disjoint sets can be represented by the following Venn diagram.
211 operations assets Para 7.5

A B

fig. 7.4

3. Difference of Sets : If A and B are two sets then A~B is the set of all elements
that are in A but not in B.
Similarly, B~A is the set of all elements that are in B but not in A. It is repre-
sented by the shaded region in the following Venn Diagram. For example if U
= {0, 1, 2, 3, 4, 5, 6, 7, 8, 9}, A = {0, 2, 4, 6, 8} and B = {1, 2, 3, 4, 5} Then A~B =
{0, 6, 8} and B~A = {1, 3, 5}
U U

A-B B-A

A B A B

fig. 7.5

4. Complement of a Set : If A is the subset of the universal set U, then the

complement of A is the set of all elements in U that are not elements of A, it
is represented as A´. For example if U = {0, 1, 2, 3, 4, 5, 6, 7, 8, 9} A = {0, 2, 4, 6,
8} Then A´ = {1, 3, 5, 7, 9}
U

A
A’

fig. 7.6

Note: (A´)´ = A
Properties:
1. Α ∪ Α = A , A ∩ A = A
2. A ∪ U = U , A ∩ U = A
3. Α ∪ A′ = U , A ∩ A′ = ϕ
Para 7.7 set theory 212

4. Distributive Laws:
A ∪ (B ∩ C) = (A ∪ B) ∩ (A ∪ C)
A ∩ (B ∪ C) = (A ∩ B) ∪ (A ∩ C)
4. De-Morgan’s Laws:
(Α ∪ B)′ = A′ ∩ B′
(A ∩ B)′ = A′ ∪ B′

7.6 Applications of Set Theory:

1. If A and B are two disjoint sets, then
n(A ∩ B) = 0
n(A ∪ B) = n(A) + n(B)
2. If A and B are not disjoint sets, then
n(A ∪ B) = n (A) + n(B) – n (A ∩ B)
3. If A, B and C are three disjoint sets, then
n(A ∩ B) = n(B ∩ C) = n(A ∩ C) = n(A ∩ B ∩ C) = 0
n(A ∪ B ∪ C) = n(A) + n(B) + n (C)
4. If A and B are not Disjoint sets, then
n(A ∪ B ∪ C) = n(A) + n(B) + n (C) – n(A ∩ B) – n(B ∩ C) – n(C ∩ A) + n(A
∩ B ∩ C)

7.7 Cartesian product of sets

Ordered Pair : Two elements a and b, listed in a specific order, form an ordered
pair, it is denoted by (a, b).
Cartesian Product of sets : If A and B are two non-empty sets, then the set of
all ordered pairs (a, b) such that a belongs to A and b belongs to B, is called
the Cartesian product of A and B. It is denoted by A × B.
Thus, A × B = {(a, b) : a ∈ A and b ∈ B} If A = Ø or B = Ø, Then, A × B = Ø
Note:
1. n (A × B) = n (A) × n (B)
2. A × B ≠ B × A; but n(A × B) = n(B × A). e.g. Let A = {1, 3, 6} and B {3,
5}
The product set A × B = {(1, 3), (1, 5), (3, 3), (3, 5), (6, 3), (6, 5)}
B × A = {(3, 1), (3, 3), (3, 6), (5, 1), (5, 3), (5, 6)} Therefore A × B ≠ B × A; but n(A
× B) = n(B × A).
213 Cartesian product of sets Para 7.7

EXAMPLES:

Example 1 : In a group of 24 persons, there are 6 Indians, 12 Doctors, and 15

Chess players. Only one of them was an Indian Doctor who played Chess, 2
were Indian doctors who didn’t play Chess; 2 were Indian Chess players who
were not Doctors. How many of them were Doctors who played chess, but
were not Indians?
Solution: We know that Only 1 of them was an Indian Doctor who played Chess,2
were Indian doctors who didn’t play Chess; 2 were Indian Chess players who
were not Doctors.

Indian Doctor
12 – (3 + x)
1 2

2 x

15 – (3 + x)
Chess
player

fig. 7.7

Now, Let the number of Doctors who played chess, but were not Indians, be x.,
Therefore the persons who were only Doctors will be 12 – (2 + 1 + x) = 9 – x.
And the number of persons who were chess players but neither Indians nor
doctors will be =15 – (2 + 1 - x) = 12 – x.
Now if we add all the values from the Venn Diagram, the sum should be equal
to 24 = total number of persons,
Therefore, 1 + 2 + 1 + 2 + x + 9 – x + 12 – x = 24
i.e. 27 – x = 24
Therefore x = 3.
Hence there were 3 Doctors who played chess, but were not Indians.

Example 2: If U = {0, 1, 2, 3, 4, 5, 6, 7, 8, 9}, A = {0, 2, 4, 6, 8} and B = {1, 2, 3, 4, 5}

then find the values of the following

(a) Α′ (b) B′ (c) A ∪ B (d) (A ∪ B)′

(e) A ∩ B (f) A ∪ B′ (g) Α′ ∪ B (h) (A ∩ B)′
(i) A′ ∪ B′ (j) Α′ ∩ B′
Para 7.7 set theory 214

Solution:
(a) Α′ = U ~ A = {0, 1, 2, 3, 4, 5, 6, 7, 8, 9} ~ {0, 2, 4, 6, 8} = {1, 3, 5, 7, 9}
(b) B′= U ~ B = {0, 1, 2, 3, 4, 5, 6, 7, 8, 9} ~ {1, 2, 3, 4, 5} = {0, 6, 7, 8, 9}
(c) A ∪ B = {0, 2, 4, 6, 8} ∪ {1, 2, 3, 4, 5} = {0, 1, 2, 3, 4, 5, 6, 8}
(d) (A ∪ B)′= U ~ (A ∪ B) = {0, 1, 2, 3, 4, 5, 6, 7, 8, 9} ~ {0, 1, 2, 3, 4, 5, 6, 8} =
{7, 9}
(e) A ∩ B = {0, 2, 4, 6, 8} ∩ {1, 2, 3, 4, 5} = {2, 4}
(f) Α ∪ B′ = {0, 2, 4, 6, 8} ∪ {0, 6, 7, 8, 9} = {0, 2, 4, 6, 7, 8, 9}
(g) Α′ ∪ B = {1, 3, 5, 7, 9} ∪ {1, 2, 3, 4, 5} = {1, 2, 3, 4, 5, 7, 9}
(h) (Α ∩ B)′ = U ~ (A ∩ B) = {0, 1, 2, 3, 4, 5, 6, 7, 8, 9} ~ {2, 4} = {0, 1, 3, 5, 6, 7,
8, 9}
(i) Α′ ∪ B′ = {1, 3, 5, 7, 9} ∪ {0, 6, 7, 8, 9} = {0, 1, 3, 5, 6, 7, 8, 9}
(j) Α′ ∩ B′ = {1, 3, 5, 7, 9} ∩ {0, 6, 7, 8, 9} = {7, 9}

Example 3: In a class of B.Com. 1st year, 65% of the students like Statistics, and
75% of the students like Accounts. If the class has 120 students, how many of
them like both Accounts and Statistics ?
Solution: Let A be the set of student who like Accounts, and S be the set of student
who like Statistics. Then, n (A) = 75 n(S) = 65and n (A ∪ S) = 100. (Note: we
have taken the percentage values of the number of elements).
Now, n(A ∩ S) = n(A) + n(S) – n(A ∪ S) = 75 + 65 – 100 = 40.
Hence, 40% of the class like both Accounts and Statistics. The number of stu-
dents who like both Accounts and Statistics = 40% of 120 = 48 students.

Example 4: In a group of 95 children, 40 play cricket, 54 play football and 12 play

both cricket and football. Find the number of children who play

(i) Cricket only (ii) Football only

(iii) either Cricket or Football (iv) neither Cricket nor Football.
Solution: Let U = the group of children, C = children who play Cricket and F =
students who play Football
Then n (U) = 95, n (C) = 40,n (F) = 54 and n (C ∩ F) = 12
The number of children who play Cricket only = n(C) – n(C ∩ F) = 40 – 12 = 28
The number of children who play Football only = n (F) – n(C ∩ F) = 54 – 12 = 42
The number of children who play either Cricket or Football = n (C ∪ F)= n(C)
+ n(F) – n(C ∩ F)
= 40 + 54 – 12= 82.
The number of children who play neither Cricket nor Football = n(C ∪ F)’ =
n(U) – n(C ∪ F) = 95– 82 = 13.
215 Objective type questions

Example 5 : If A = {1, 2, 3} and B = {a, b} find A × B

Solution: A × B = {(1, a), (1, b) (2, a), (2, b), (3, a), (3, b)}.

Example 6: If A × B = {(5, 2), (7, 6) (7, 4), (7, 2), (5, 4), (5, 6)}, find A and B.
Solution: A is the set of all first co-ordinates of A × B, while B is the set of all
second co-ordinates of elements of A × B. Therefore A = { 5, 7} and B = {2, 4, 6}

Example 7: If A = {2, 3}, B = {4, 5}, C = {5, 6} then find A × (B ∩ C).

Solution: B ∩ C = {5}
Therefore, A × (B ∩ C) = {2, 3} × {5} = { (2, 5), (3, 5)

Example8 : If A = {2, 3}, B = {4, 5}, C = {5, 6} then find A × (B ∪ C).

Solution: B ∪ C = {4, 5, 6}
Therefore, A × (B ∪ C) = {2, 3} × {4, 5, 6}= {(2, 4) (2, 5) (2, 6) (3, 4) (3, 5) (3, 6)}

Example 9: If A = (1, 2, 3), B = (4, 3, 5), C = (3, 5, 6) then find (A × B) ∩ (C × A).

Solution: (A × B) = {(1, 4), (1, 3), (1, 5), (2, 4), (2, 3), (2, 5), (3, 4), (3, 3), (3, 5)}
(C × A) = {(3, 1), (3, 2), (3, 3), (5, 1), (5, 2), (5, 3), (6, 1), (6, 2), (6, 3)}
Therefore, (A × B) ∩ (C × A) = {(3, 3)}

Example 10: If P has 2 elements, Q has 5 elements and R has 3 elements, how
many elements does the Cartesian product set P × Q × R have?
Solution: If sets P, Q and R have p, q and r sets respectively then the number of
elements in P × Q× R = pqr
n(P × Q × R) = 2 × 5 × 3 = 30.

OBJECTIVE TYPE QUESTIONS

Q1. If U is superset of A, then, A ∪ U =
(a) A (b) U (c) φ (d) Α′
Q2. If U is superset of A, then, A ∩ U =
(a) A (b) U (c) φ (d) Α′
Q3. If U is superset of A, then, U ∪ U =
(a) A (b) U (c) φ (d) Α′
Q4. If U is superset of A, then, A ∩ U’ =
(a) A (b) U (c) φ (d) Α′
Q5. If U is superset of A, then, A ∩ φ =
(a) A (b) U (c) φ (d) Α′
 set theory 216

Q6. If U is superset of A, then, A ∪ A′ =

(a) A (b) U (c) φ (d) Α′
Q7. If A = {1, 2, 3, 5, 6, 7, 8, 9} and B = {1, 3, 6, 7, 10,11, 12}. Cardinal number of A
~ B is
(a) 4 (b) 3 (c) 6 (d) 5
Q8. The set {x: 0 < x < 4, x ∈ N} can be written as
(a) {0, 1, 2, 3, 4} (b) {1, 2, 3} (c) {1, 2, 3, 4} (d) { 2, 3, 4}
Q9. The set of cubes of the natural number is
(a) a finite set (b) an infinite set
(c) a null set (d) singleton set
Q10. The set {2x : x is any positive rational number} is
(a) an infinite set (b) a null set (c) a finite set (d) singleton set
Q11. E is a set of positive even number and O is a set of positive odd numbers, then
E ∪ O is a
(a) set of whole numbers (b) N
(c) set of rational numbers (d) set of real numbers
Q12. If Q is the set of positive rational number and R is the set of real numbers then
(a) Q ⊆ R (b) Q ⊂ R (c) R ⊂ Q (d) R ⊆ Q
Q13. If N is the set of natural numbers and I is the set of positive integers, then
(a) N = I (b) N ⊂ I (c) N ⊆ I (d) I ⊂ N
Q14. If I is the set of isosceles triangles and E is the set of equilateral triangles, then
(a) I ⊂ E (b) E ⊂ I (c) E = I (d) E ⊃ I
Q15. If R is the set of isosceles right angled triangles and I is set of isosceles triangles,
then
(a) R = I (b) R ⊆ I (c) R ⊂ I (d) none of these
Q16. In a group of 500 persons, 350 can play cricket and 250 can play football. Then
the number of persons that can play both games is :
(a) 100 (b) 150 (c) 120 (d) none
Q17. It is known that out of 600 students in a school, 150 students drink Coca Cola,
225 drink pepsi, 100 drink both flavours. Number of students who drink neither
flavour is ___________
(a) 325 (b) 275 (c) 200 (d) none
Q18. Out of 1020 boys in a college, 406 play cricket, 324 play badminton, 250 play
table tennis, 80 play both cricket and badminton, 64 play badminton and table
tennis, 92 play table tennis and cricket, 30 play all three games. Number of
boys that play at least one game is :
217 true/false

(a) 774 (b) 246 (c) 240 (d) none

Q19. In Q18, find the number of boys that play no game.
(a) 774 (b) 246 (c) 240 (d) none
Q20. If A and B are two sets then Α ∩ (Α ∪ B) equals
(a) A (b)B (c)empty set (d) none

FILL IN THE BLANKS

1.
Α ∪ Α = _______________
2.
Α ∩ Α = _______________
3.
(Α ∪ B)′ = ______________
4.
(Α ∩ B)′ = ______________
5. The number of subsets of the set {2, 3, 4} is_____
6. The number of subsets of the set containing n elements is:_
7. The null set is represented by ____________
8. A = {1, 2, 3, 5, 7}, B {4, 6, 8, 10} then A ∩ B = ______________
9.
φ ∪ {φ} = _____________
10. A - (A - B) = ___________
11. Let X ⊂ Y and Y and Y ⊂ B. Then X × Y ⊂ _________

TRUE/FALSE
1.
All void sets are equal.
2.
The void set is a subset of every set.
3.
The power set of the empty set is void.
4.
Every subset of an infinite set is finite.
5.
For any two sets A and B either A ⊂ B or B ⊂ A
6.
P( A∪ B) = P(A) ∪ P(B)
7. P( A ∩ B) = P(A) ∩ P(B)
8. P( A B) = P(A) P(B)
9.
A ∩ B = φ ⇒ either A = φ or A = B = φ
10. (A B) ∩ B = φ
11. A ∩ φ′ = A
12. A × B = φ ⇒ A = φ and B = φ
 set theory 218

ANSWERS TO OBJECTIVE TYPE QUESTIONS

A1. (b)U
A2. (a) A
A3. (b)U
A4. (c) φ
A5. (c) φ
A6. (b)U
A7
(a) 4
If A = {1, 2, 3, 5, 6, 7, 8, 9} and B = {1, 3, 6, 7, 10, 11, 12}. A ~ B = { 2, 5, 8, 9},
therefore cardinal number = 4.
A8. (b) The set {x: 0 < x < 4, x ∈ N} is the set of natural numbers less than 4, hence
it is {1, 2, 3}.
A9. (b)The set of cubes of the natural number is an infinite set because there are
infinite natural numbers.
A10. (a)The set {2x | x is any positive rational number} is an infinite set because x
can be any positive rational number, which are infinite.
A11. (b) E is a set of positive even numbers {2, 4, 6, 8,…….} and O is a set of positive
odd numbers {1, 3, 5, 7,…….}
Then E ∪ O is a set of Natural numbers, N {1, 2, 3 ,4, 5, 6, 7, 8,…….}.
A12. (b) If Q is the set of positive rational number and R is the set of real numbers
then Q ⊂ R, because all positive rational numbers are real numbers, but all
real numbers are not positive rational numbers.
A13. (a) If N is the set of natural numbers and I is the set of positive integers, then
N = I because both have the same elements i.e. 1, 2, 3, 4, 5, 6, 7,………………..
A14. (b) If I is the set of isosceles triangles and E is the set of equilateral triangles,
then E ⊂ I, because some isosceles triangles are equilateral triangles, but all
equilateral triangles are isosceles triangles.
A15. (c) If R is the set of isosceles right angled triangles and I is set of isosceles
triangles, then R ⊂ I, because some isosceles triangles are isosceles right angled
triangles, but all isosceles right angled triangles are isosceles triangles.
A16. (a) 100
n(c) = 350, n(F) = 250, n(C ∪ F) = 500
n(C ∪ F) = n(c) + n(F) – n(C ∩ F) ⇒ 500 = 350 + 250-n(C ∩ F)
A17. (a) 325
n(A) = 150, n(B) = 225, n(A ∩ B) = 100
Number of students who drink either coca cola or pepsi is
n(A ∪ B) = n(A) + n(B) – n(A ∩ B) = 150 + 225 – 100 = 275
Number of students who drink neither coca cola nor pepsi is n( A ∩ B ) = n(
A ∪ B ) = 600 – 275 = 325
A18. (a) 774
219 answers to true/false

n(C ∪ B ∪ T) = n(C) + n(B) + n(T) – n(C ∩ B) – n(B ∩ T) – n(C ∩ T) + n(C ∩T)

+ n(C ∩ B ∩ T)
= 406 + 324 + 250 – 80 – 64 – 92 + 30 = 774
Number of boys who play atleast one game = 774
A19. (b) 246
Number of boys who play none = 1020 – 774 = 246
A20. (a)
A ⊂ (A ∪ B) ⇒ A ∪ (A ∪ B) = A

ANSWERS TO FILL IN THE BLANKS

1. A
2. A
3. A′ ∩ B′
4. A′ ∪ B′
5. 8
6. 2n
7. Ø
8. { }. A = {1, 2, 3, 5, 7}, B {4, 6, 8, 10} Since A and B have no common elements
therefore A ∩ B = { }.
9. Ø
10. A ∩ B
11. A × B

ANSWERS TO TRUE/FALSE
1. True
2. True
3. False. Since P(φ) contains one element φ
4. False. The set of natural numbers is an infinite subset of set of integers.
5. False. If A = {a, b}, B = {p, q} then neither A ⊂ B, nor, B ⊂ A
6. False. If A = {a, b}, B = {p, q} then {a, p} ∈P(A ∪ B), but, {a, p}∉ P(A) ∪ P(B)
7. True
8. False
9. False. If A= {a, b}, B={p, q} then A ∩ B = φ but neither A = φ nor B = φ
10. True
11. True
12. False. If A={1, 2, 3} and B = φ, A × B = φ but A ≠ φ
 C H A P T E R

8 Relations and Functions

Learning Objectives
By the end of this chapter, you will be able to understand:
u Defining relation
u Domain and range of relations
u Types of relations
u Defining Function
u Algebra of functions
u Identify different types of functions such as even and odd, increasing
and decreasing function
u Functions used in business and economics
u Computation of break-even values

8.1 INTRODUCTION
This chapter deals with the concept of relations and functions. A function
is a relation which shows the dependency of one function on another. The
concept of functions is of paramount importance in Mathematics and
among other disciplines also. In this chapter, we first introduce some special
types of functions such as even and odd function, increasing and decreas-
ing function, linear function, quadratic function, rational function, absolute
function, polynomial function etc. After that, we discuss functions related to
business and economics such as demand function, supply function, revenue
and profit function etc.

220
221 types of relations Para 8.3

8.2 RELATION
If A and B are two non-empty sets, then a relation R from A to B is a subset
of A × B . i.e. r ⊆ A × B
If (a, b) ∈ R then we say that a is related to b, represented by a R b.
If (a, b) ∉ R then we say that a is not related to b, represented by a R b
Domain of a relation : If R is a relation from a set A to B, then the set of first
elements of all ordered pairs of R is called the domain of R. Dom (R) = {a :
(a, b) ∈ R}
Range of a relation: If R is a relation from A to B, then the set of second elements
of all ordered pairs of R is called the range of R. Range (R) = {b : (a, b) ∈ R}
Illustration:
Let A = {1, 2, 3} and B = {2, 4, 6}
Then A × B = {(1, 2), (1, 4), (1, 6), (2, 2), (2, 4), (2, 6), (3, 2), (3, 4), (3, 6)} By defi-
nition, every subset of A × B is a relation from A to B.
Let a relation R be such that, R = {(1, 2), (1, 4), (3, 2), (3, 4)}
Then Dom (R) = {1, 3} and Range (R) = {2, 4}
Number of Relations: If the sets A and B have m and n elements respectively,
then the number of ordered pairs in the Cartesian product A × B is mn. There-
fore the number of subsets of A × B is 2mn. Therefore the number of relations
from A to B is 2mn and the number of ordered pairs in the Cartesian product
A × A is m.m = m2 . Therefore the number of relations from A to A is 2m2.

8.3 Types of Relations:

1. Identity Relation : Let A be a set. The relation I = {(a, a) : a ∈ A} is called
the identity relation on A. i.e. every element of A is related to itself only.
e.g: Let A = {1, 2, 3} then I = {(1, 1), (2, 2), (3, 3)}
2. Reflexive Relation : If A = {a, b, c,} be any set then the relation R is a
subset of the product set A × A
If R contains all ordered pairs of the form (a, a) in A × A, then R is called
reflexive. In a reflexive relation ‘a’ is related to itself. For example, ‘Is
equal to’ is a reflexive relation since a = a.
3. Symmetric Relation : If (a, b) ∈ R ⇒ (b, a) ∈ R for every a, b ∈ A then R is
called symmetric.
i.e. a R b ⇒ b R a, for every a, b ∈ A. For example a = b ⇒ b = a. Hence
the relation ‘is equal to’ is a symmetric relation.
4. Transitive Relation : If (a, b) ∈ R and (b, c) ∈ R ⇒ (a, c) ∈ R for every a, b,
c, ∈ A then R is called a Transitive relation. i.e. a R b and b R c ⇒ a R c,
Para 8.5 Relations and functions 222

for every a, b, c ∈ A. For example a = b, b = c ⇒ a = c. Hence the relation

‘is equal to’ is a transitive relation.
5. Equivalence Relation : A relation which is reflexive, symmetric and
transitive is called an equivalence relation or simply an equivalence. ‘is
equal to’ is an equivalence relation.
e.g. If set A is a set of all straight lines in a plane. The relation “is parallel
to” on the set A is Reflexive, since a|| a for a ∈ A It is a symmetric, since a
| | b ⇒ b| | a. It is transitive because a | |b , b | |c ⇒ a||c. Hence, the relation
“is parallel to” on the set A of all straight lines in a plane is an equivalence
relation.
6. Inverse Relation : If R be a relation on A, then the relation R–1 on A,
defined by R–1 = {(b, a) : (a, b) ∈ R} is called an inverse relation on A. Dom
(R–1) = Range (R) and Range (R–1) = Dom (R).
e.g. Let A = {1, 2, 3} and R = {(1, 2), (2, 2), (3, 1), (3, 2)} Then R being a
subset of A × A, it is a relation on A.
Dom (R) = {1, 2, 3} and Range (R) = {2, 1}and R–1 = {(2, 1), (2, 2), (1, 3),
(2, 3)}
Then Dom (R–1) = {2, 1} and Range (R–1) = {1, 2, 3}
Therefore, Dom (R–1) = Range (R) and Range (R–1) = Dom (R).

8.4 FUNCTIONS
Definition: Let A and B be any two non- empty sets. Then a function is a rule
from A to B which associates to each element ‘a’ of A , a unique element ‘b’
of B. The element ‘b’ is called image of ‘a’ under f and ‘a’ is called pre-image
of ‘b’. ‘A’ is called domain of f and ‘B’ is called co-domain of f. The set of all
images of the elements of the domain is called range off. The elements ‘a’ and
‘b’ are called independent and dependent variables respectively.

Example 1: Determine if y2 = x is a function.

Solution : If y2 = x then y = ± √ x. . Therefore, to each value of x, there is associated

two values of y namely xand − √ x . Hence y2 = x is not a function.

8.5 ALGEBRA OF FUNCTIONS

If f and g are two functions then
(i) (f + g)(x) = f(x) + g(x)
(ii) (f - g)(x) = f(x) - g(x)
223 types of functions Para 8.6

(iii) (f g)(x) = f(x) g(x)

(iv) (f/g)(x) = f(x)/g(x) where g(x) ≠ 0

Example 2: If f(x) = 2x2 +1, g(x) = 3x -2, find (a) (f + g)(x) (b) (f - g)(x) (c) (f g)(x)
(d) (f/g)(x)
Solution:
(a) (f + g)(x) = f(x) + g(x) = 2x2 +1+3x -2 = 2x2 +3x -1
(b) (f - g)(x) = f(x) - g(x) = (2x2 +1)-(3x -2) = 2x2 -3x +3
(a) (f g)(x) = f(x) g(x) = (2x2 +1)(3x -2) = 6x3 – 4x2 +3x -2
(b) (f / g)(x) = f(x) / g(x) = (2x2 +1) / (3x -2)

8.6 TYPES OF FUNCTIONS

Even function: A function f(x) is said to be an even function if f(x) = f(‑x). For
example, f(x) = x2 is an even function because f(‑x) = (‑x)2 = x2 = f(x).
Odd function: A function f(x) is said to be an odd function if f(x) = ‑f(‑x). For
example, f(x) = x3 is an odd function because f(‑x) = (‑x)3 = ‑x3 = ‑f(x).
Increasing function: Let f be a function defined on an interval, and let x1 and
x2 denote points in that interval. Then f is increasing on the interval if f(x1) <
f(x2) whenever x1 < x2
Decreasing function: Let f be a function defined on an interval, and let x1 and
x2 denote points in that interval. Then f is decreasing on the interval if f(x1) >
f(x2) whenever x1 < x2
Constant function: Let f be a function defined on an interval, and let x1 and
x2 denote points in that interval. Then f is constant on the interval if f(x1) =
f(x2) for all points x1 and x2. In other words, a function of the form f(x) = c
where c is a constant is called a constant function. The graph of a constant
function f(x) = c is a straight line parallel to x – axis which is above or below
x- axis according as c is positive or negative. If c = 0, then the straight line is
coincident with x axis.
Linear function: A function of the form f(x) = ax+b where a and b are constants
and a ≠0 is called a linear function. The graph of a linear function is a straight
line. Moreover the slope of f(x) = ax+b is ‘a’.

Example 3: Suppose consumers will demand 40 units of product when the price
is ` 12 per unit and 25 units when the price is ` 18 each. Find the demand
function, assuming that it is linear. Also determine the price per unit when 30
units are demanded.
Solution: Let the demand function be x =a p +b where p is the price per unit
and x is the quantity demanded. Then using the given information, we get
Para 8.6 Relations and functions 224

40 = 12 a +b
25 = 18 a +b
Solving these two equations, we get a = -2.5 and b =70. Therefore the demand
function is x = -2.5p +70
Put x =30 in it , we get p =16. Therefore, price per unit is `16 when 30 units
are demanded.

Example 4: The life expectancy, E, of males in the year 1980 was 68 years. It
increased to 75 years in the year 1994. (a) Express E as a linear function of
time t; and (b) Determine life expectancy in the year 2000.
Solution: Let E = at +b be the linear function of time t where E is the life
expectancy. Let x denote the year. Take 1980 as base year. Set t = x -1980. Put
x = 1994 then we get t =14. From the given information, we get
68 = a(0) +b and 75 = a(14) + b.
Solving these two equations, we get a = 0.5 and b = 68. Then E = 0.5 t +68 is
the required linear function.
(b) For year 2000, t = 2000-1980 =20. Put t =20 in the linear function , we get
E = 0.5(20) +68 = 78 years.
Quadratic Function: A function of the form f(x) = ax2 + bx +c where a, b, c
are constants and a ≠0 is called a quadratic function. The graph of a quadratic
function y = f(x) = ax2 + bx +c is a parabola that opens upward or downward
according as a > 0 or a < 0. Each parabola has a vertical axis of symmetry and a
turning point called a vertex. Typical graphs of parabola are shown in figure 3.1
Axis

Axis
Vertex

Vertex

y2 = 4ax
x2 = 4ay

fig 3.1

Example 5: Determine the numbers a, b c such that the function y = = ax2 + bx +c

fits to the data points (-1,7), (0,4) and (2,6). Hence express the quadratic function.
Solution: The given quadratic function is y = = ax2 + bx +c ….(1)
Put x = -1 and y = 7 in (1) , we get 7 = a – b + c …...(2)
225 functions related to Business & Economics Para 8.7

Put x = 0 and y = 4 in (1) , we get 4 = 0 + 0 + c. ..It gives c= 4

Put x = 2 and y = 6 , we get 6 = 4a +2b +c …..(3)
Solving (2) and (3) and using c = 4 , we get a = 4/3 , b = -5/3 and c= 4.
4 2 5
Then the quadratic function is y = x − x+4
3 3
Polynomial function: A function of the form f(x) = a0xn + a1xn-1 + a2xn-2 + .........
an where a0, a1, a2,.........an
are constants and n is a non- negative integer, a0 ≠ 0 , is called a polynomial
function of x of degree n. For example: the function f (x) = 3x3 -5x2 +10x +7
is a polynomial function in x of degree 3.
p (x )
Rational Function: A function of the form f ( x ) = where p(x) and q(x)
q (x )
are polynomials, is called a rational function.
Absolute Function: The function defined by
x when x ≥ 0 
f(x) = x =   is called an absolute function. The domain of the
-x when x < 0 
absolute function is the set R of real numbers and the range is the set of all
non- negative real numbers. The graph of the absolute function is shown in
figure 3.2.
y
=

0
–x

>
,x

x
<

x,
0

=
y

fig. 3.2 : Absolute Function

Identity function: Let I be a function from A to A defined as f(x) = x for all x

∈ A. Then I is called an identity function.

8.7 FUNCTIONS RELATED TO BUSINESS AND ECONOMICS

In this section we present some functions which are very useful in business
and economics.
Demand function: An equation that relates price per unit (p) and quantity de-
manded (x) at that price is called a demand function. It is of the form x = f(p).
Para 8.7 Relations and functions 226

Its graph is shown in figure 3.5. Usually there is an inverse relation between
price and demand i.e., an increase in price corresponds to a decrease in quantity
demanded and vice – versa.

D
em
Price per unit (`)

an
d
cu
rv
e

Quantity demanded

Fig. : 3.5

Supply function: An equation that relates price per unit (p) and quantity sup-
plied (x) at that price is called a supply function. It is of the form x = f(p). Its
graph is shown in figure 3.6. Usually there is an direct relation between price
and supply i.e., an increase in price corresponds to an increase in quantity
supplied and vice – versa.
Price per unit (`)

e
rv
cu
ly
pp
Su

O Quantity supplied

Fig. : 3.6

Cost function: Let C be the total cost incurred in the production of x units of
a commodity. Then a function say, C= C(x) that relates C and x is called a cost
function. We have
227 types of relations Para 8.7

Total cost = fixed cost + variable cost where fixed cost is independent of the
quantity produced and variable cost is the sum of all the cost that are depen-
dent on the level of production, such as raw material, labour etc.
Revenue Function: Let R be the revenue earned from selling x units of a com-
modity at a price p per unit . Then R is given by
R = px
This R is called the total revenue function.
Profit function: Let P(x) be the profit function then P(x) = R(x) – C(x) where
R(x) and C(x) are the revenue and cost functions.
Break – even point: The break- even point is the level of production where the
profit is zero. At this point, the company is neither making a profit nor losing
money. When P(x) = 0 then R(x) = C(x).
Consumption Function: Let C denotes the total national income and I denotes
the total national income , then the function of the form C = f(I) is called the
consumption function. The difference between I and C is savings i.e., S = I –C

Example 6: A garment manufacturer is planning production of new variety of

shirts. It involves initially a fixed cost of `1.5 lacs and a variable cost of `150
for producing each shirt. If each shirt can be sold at `350, then find (i) the cost
function (ii) the revenue function (iii) the profit function (iv) the break-even point
Solution: Let x denotes the number of shirts.
(i) The cost function = C(x) = Fixed cost + variable cost = 150000 + 150x
(ii) Revenue function = R(x) = px = 350x
(iii) Profit function = P(x) = R(x) – C(x) = 350x – (150000 + 150x) = 200x –
150000
(iv) At break –even point , P(x) = 0
Therefore, 200x – 150000=0
⇒ x = 750

Example 7: For a new product, a manufacturer sets up an infrastructure which

costs him `1,50,000. The variable cost is estimated as `125 for each unit of the
product. The sale price per unit is fixed at `160. Write down the cost function
C(x), Revenue function R(x) and Profit function P(x) for x units of the product.
How many minimum number of units are to be produced in the first year of
production so that there may be no loss during that year?
Solution: Set up cost = Fixed cost = `1,50,000
Variable cost = `125 per unit
Selling price = p = `160 per unit
(i) The cost function = C(x) = Fixed cost + variable cost = 150000 +125x
Para 8.7 Relations and functions 228

(ii) Revenue function = R(x) = px = 160x

(iii) Profit function = P(x) = R(x) – C(x) =160x –(150000 +125x) = 35x – 150000
(iv) At break –even point , P(x) = 0
⇒ 35x – 150000=0
⇒ x = 4286 approx.

Thus, at least 4268 units are to be produced in the first year of production so
that there may be no loss during that year.

Example 8: The total cost and the total revenue of a company that produces and
sells x units of a particular product are respectively C(x) = 5x +350 and R(x)
= 50x –x2. Find
(i) the break-even values, (ii) the values of x that produce a profit, (iii) the values
of x that produce a loss.
Solution: Fixed cost = FC = `350, Variable cost = `5 per unit
(i) At break – even point, P(x) = 0
 R(x) = C(x)
 50x-x2 = 5x + 350
 x2-45x +350 =0
 (x-10)(x-35) = 0
 x =10 or 35
(ii) To find the value of x that produces a profit , we put
P(x) > 0
 R(x)-C(x) > 0
 50x – x2 -5x-350 > 0
 -x2 + 45x-350 > 0
 -(x2-45x+350) > 0
 x2-45x+350 < 0
 (x-10)(x-35) < 0 which is possible when 10 < x < 35
(iii) To find the value of x that produces a loss, we put
P(x) < 0
 R(x)-C(x) < 0
 50x – x2 -5x-350 < 0
 -x2 +45x-350 < 0
 -(x2 -45x+350) < 0
 x2-45x+350 > 0
229 types of relations Para 8.7

 (x-10)(x-35) > 0 which is possible when both brackets are positive or

both are negative.
Both brackets are positive when x > 35 and both brackets are negative when
x < 10
Hence, the values of x that produces a loss is when x < 10 or x >35

Example 9: The cost function C(x) for x breads is given by C(x) = `3.5x + `12000.
Each bread is put to a special levy of 20 paise for Andhra Pradesh cyclone
victims. Then
(i) if each bread is sold for `6 , determine the minimum number of breads
that should be produced and sold to ensure no loss,
(ii) If the selling price is increased by 70 paise per bread , what would be the
break –even point,
(iii) If 6000 breads are sold only, what price per bread should be charged to
guarantee no loss.
Solution: Revenue function R(x) = px = 6x
Cost function C(x) = 3.5x +12000 +0.20x = 3.7x +12000
(i) At break –even point , P(x) = 0
 R(x) = C(x)
 6x= 3.7x +12000
 x = 5217.39 or x= 5218 breads.
(ii) New selling price = p = `6.70 per bread
R(x) = px = 6.70 x
At break –even point , P(x) = 0
 R(x) = C(x)
 6.70 x = 3.7x +12000
 3x = 12000 or x = 4000 breads
(iii) Let p be the price charged to ensure no loss. Then,
R(x) = C(x)
px = 3.7x +12000
Put x = 6000,
p(6000) = 3.7(6000) + 12000
 p= `5.70
 Relations and functions 230

OBJECTIVE TYPE QUESTIONS

Q.1 If f(x) = 2x -1 and g(x) = x2 -4x, then (f + g)(x) =
(a) x 2 − 2x − 1 (b) x 2 + 2x − 1
(c) x 2 − 2x + 1 (d) none
Q2. If f(x) = 2x -1 and g(x) = x2 -4x, then (f - g)(x) =
(a) x 2 − 6x − 1 (b) −x 2 + 6x − 1
(c) −x 2 − 2x + 1 (d) none
Q3. If f(x) = 2x -1 and g(x) = x2 -4x, then (f g)(x)
(a) 2x 3 − 9x 2 + 4x (b) 2x 3 − 9x 2 − 4x
(c) 2x 3 − 9x 2 − 4x (d) none
Q.4 If f(x) = 2x - 1 and g(x) = x2 - 4x, then ( f/g)(x)=
2x + 1 2x − 1 2x + 1
(a) (b) (c) (d) none
x(x − 4) x(x − 4) x(x + 4)

Q5. A producer earns ` 4500 in the first week and `6000 in the second week. On
plotting these points , the manufacturer observes a linear function may fit the
data. Then the linear function that fits the data is :
(a) y=3000x +1500 (b) y = 1500x+3000
(c) y = 3000+3000x (d) none
Q6. In Q5. above, the earning for the third week is :
(a) `7500 (b) `7000 (c) `5000 (d) none
Q7. A survey shows that there is a linear function between population of a country
and time. In the year 1980, population was 84 crores and in the year 1990
population was 93 crores. Then the linear function between population and
time is
(a) y = 0.9x +84 (b) y = 9x +84
(c) y = 0.9x +840 (d) none
Q8. In Q7 above, the population in the country in the year 2000 is :
(a) 104 crores (b) 102 crores (c) 100 crores (d) none
Q9. A shopkeeper earns `380 in the first week, ` 660 in the second week and
`860 in the third week. On plotting the points (1,380), (2,660) and (3,860), the
shopkeeper feels that a quadratic function may fit the data.
Find the quadratic function that fits the data.
(a) y = -40 x2 +400x +20 (b) y = 40 x2 +400x +20
(c) y = 40 x2 - 400x +20 (d) none
Q10. In Q9 above, the earnings for the fourth week is:
(a) `1000 (b) `980 (c) `900 (d) none
231 objective type questions

Q11. A publishing house finds that the cost of production directly attributed to each
book is `30 and that the fixed costs are `15,000. If each book can be sold for
`45, then the cost function is:
(a) C(x) = 30x - 15000 (b) C(x) = 30x + 15000
(c) can’t be determined (d) none
Q12. In Q11, above the revenue function is:
(a) R(x) = 45x (b) R(x) = - 45x
(c) can’t be determined (d) none
Q13. In Q11 above, the profit function is :
(a) P(x) = 15x +15000 (b) P(x) = 15x-15000
(c) P(x) = 15x-15000 (d) none
Q14. In Q11, above, the break-even point is:
(a) 1000 (b) x =1500
(c) can’t be determined (d) none
Q15: A profit making company wants to launch a new product. It observes that the
fixed cost of the new product is ` 35,000 and the variable cost per unit is `500.
The revenue function for the sale of x units is given by 5000x – 100x2. Then
the profit function is
(a) P(x) = -100x2 + 450x – 35000
(b) P(x) = -100x2 + 4500x – 35000
(c) Data is insufficient
(d) None
Q16. In Q15 above, break-even values are
(a) 10 and 35 (b) 10 only (c) 35 only (d) none
Q17. The relation “is younger than” over a set of three children a, b, c is
(a) Transitive (T) (b) Symmetric (S)
(c) Reflexive (R) (d) Equivalence
Q18. The relation “Is equal to” over the set of all real numbers is
(a) Transitive (T) (b) Symmetric (S)
(c) Reflexive (R) (d) Equivalence
Q19. The relation “has the same mother as” over the set of children
(a) Transitive (T) (b) Symmetric (S)
(c) Reflexive (R) (d) Equivalence
Q20. Find the Inverse function f –1 if f(x) = 2x – 3.
y+3
(a) x = 2 y+ 3 (b) x =
2
 Relations and functions 232

y−3
(c) x = (d) none
2
x+3
Q21. Find the Inverse of y =
x
3 3
(a) x = (b) x =
y +1 y −1

y−3
(c) x = (d) none
2
Q22. The domain and range of the function f(x) = x2 is
(a) Dom = real numbers, Range = natural numbers
(b) Dom = real numbers, Range = positive real numbers
(c) Dom = real numbers, Range = real numbers
(d) Dom = natural numbers, Range = natural numbers
Q23. The range of the function f(x)=log10 (1+x) for the domain of real values of x
when 0 ≤ x ≤ 9 is :
(a) {0, ‑1} (b) {0, 1} (c) [0, 1] (d) {1}
Q24. Inverse function of y = loga x is:
(a) Y = loga x (b) ax (c) loga (1/x) (d) 1/x
Q25. “Is taller than” over the set of men is
(a) Transitive (b) symmetric (c) reflexive (d) equivalence
Q26. The relation “is perpendicular to” over the set of straight lines in a given plane
is :
(a) Transitive (b) symmetric (c) reflexive (d) equivalence
Q27. The relation “Is equal to” over the set of integers is :
(a) Transitive (b) symmetric (c) reflexive (d) equivalence
Q28. The relation “goes to the same college as”: over a set of students is:
(a) Transitive (b) symmetric (c) reflexive (d) equivalence
Q29. The relation “ is the reciprocal of” over the set of non-zero real numbers is :
(a) Transitive (b) symmetric (c) reflexive (d) equivalence
Q30. The relation “ is the cube of ” over the set of real numbers is:
(a) Transitive (b) symmetric (c) reflexive (d) none

FILL IN THE BLANKS

1. If A and B are two non-empty sets, then a relation R from A to B is a _____ of.
A×B
2. If R is a relation from a set A to B, then the set of first elements of all ordered
pairs of R is called the _____________ of R.
233 answers to objective type questions

3. If R is a relation from A to B, then the set of second elements of all ordered

pairs of R is called the _________ of R.
4. If the sets A and B have m and n elements respectively, then the number of
subsets of A×B is ___
5. In a _____________ relation ‘a’ is related to itself.
6. If (a, b) ∈ R ⇒ (b, a) ∈ R for every a, b ∈ A then R is called ______________.
7. If (a, b) ∈ R and (b, c) ∈ R ⇒ (a, c) ∈ R for every a, b, c, ∈ A then R is called a
____________ relation.
8. Dom (R–1) = ______ and Range (R–1) = __________.
9. A function is a rule from A to B which associates to each element ‘a’ of A, a
____________ element ‘b’ of B.
10. The set of all images of the elements of the domain is called ___________ of f.
11. A function f(x) is said to be an _____ function if f(x) = f(‑x)
12. A function f(x) is said to be an ____________ function if f(x) = ‑f(‑x)
13. f is ______________on the interval if f(x1) < f(x2) whenever x1 < x2
14. f is ______________ on the interval if f(x1) < f(x2) whenever x1 < x2
15. A function of the form f(x) = _______ is called a linear function.
16. A function of the form f(x) = ax2 + bx +c where a, b, c are constants and a ≠0
is called a ______________ function.
17. The domain of the absolute function is the set_______________ and the range
is the set of all __________
18. There is an inverse relation between price and _______
19. There is __________direct relation between price and supply.
20. Total cost = fixed cost + ______________
21. The break- even point is the level of production where the profit is ________.

ANSWERS TO OBJECTIVE TYPE QUESTIONS

A1. (a) x2‑2x‑1
(f + g)(x) = f(x) + g(x) = 2x‑1+x2‑4x=x2‑2x‑1
A2. (b) ‑x2 + 6x ‑ 1
(f ‑ g)(x) = f(x) ‑ g(x) = 2x‑1‑x2 + 4x = ‑x2 + 6x‑1
A3. (a) 2x3‑9x2 + 4x
(f .g)(x) = f(x) .g(x) = (2x‑1)(x2 + 4x) = 2x3 ‑ 9x2 + 4x
2x − 1
A4. (b)
x(x − 4)
f f(x) 2x − 1
(x) = =
g g(x) x(x − 4)

A5. (b) y = 1500x+3000

 Relations and functions 234

Let the linear function be y = a x +b. Then by the given information , 4500 =
a(1) +b and 6000 = a(2) +b. Solving these two equations, we get a = 1500, b
= 3000. Therefore, the linear function is y = 1500x+3000.
A6. (a) `7500
Put x = 3 in the linear function y = 1500x+3000, we get y = 7500
A7. (a) y = 0.9x +84
Let the linear function be y = ax + b. Taking year 1980 as origin, we get 84 =
a(0) +b and 93 = a(10) +b. Solving we get, a = 84 and b = 0.9. Therefore, linear
function between population and time = y = 0.9x +84 where y is population
and x for time.
A8. (b) 102 crores
Put x =20 in y = 0.9x +84 we get y = 102. Therefore, population in the year
2000 is 102 crores.
A9. (a) y = - 40 x2 +400x +20
Let the quadratic function be y = a x2 + bx + c. Then,
380 = a(1)2 + b(1) + c; 660 = a(2)2 + b(2) + c; 860 = a(3)2 + b(3) + c
Solving the above three equations, we get a = ‑40, b = 400, c = 20.
A10. (b) `980
Put x = 4 in y = -40 x2 +400x +20, we get y = `980
A11. (b) C(x) = 30x + 15000
Cost = fixed cost + variable cost = 15000+30x
A12. (a) R(x) = 45x
A13. (b) P(x) = 15x-15000
Profit = Revenue – Cost = 45x – (30x + 15000) = 15x – 15000
A14. (a) 1000
At break- even point, profit = 0. This gives 15x-15000= 0 . i.e., x = 1000
A15. (b)P(x) = -100x2 + 4500x – 35000
Cost function = 35000 + 500x, Revenue function = 5000x – 100x2
Then Profit =Revenue – Cost = (5000x – 100x2 )-( 35000 + 500x) = -100x2 +
4500x – 35000
A16. (a) 10, 35
Put profit = 0 i.e., -100x2 + 4500x – 35000 = 0. This gives x = 10, 35
A17 (a) transitive
a R b is ”a is younger than b”, b R c is “ b is younger than c”, this implies that “a
is younger than c”, i.e. a R c , therefore the relation is transitive. But a R b is “a
is younger than b” does not imply b R a is “b is younger than a”, because a and b
cannot be both simultaneously younger than each other, therefore the relation
is not symmetric. Also a R a is “a is younger than a”, is not defined because a
cannot be younger than himself, therefore the relations is not reflexive.
235 answers to objective type questions

A18. (d) Equivalence

a R b is “a = b”, b R c is “ b = c” this implies that “a = c”, i.e. a R c, therefore
the relation is transitive.
a R b is “a = b”, it implies b R a i.e. “b = a”, therefore the relation is symmetric.
Also a R a is “a = a”, which is true therefore the relations is reflexive.
Since the relation is Transitive, Symmetric and Reflexive, therefore it is an
Equivalence relation.
A19. (d) equivalence
a R b is “a has the same mother as b”; b R c is “ b has the same mother as c”
This implies that “a has the same mother as c”, i.e. a R c, therefore the relation
is transitive.
a R b is “a has the same mother as b” implies b R a i.e. “b has the same mother
as a”, therefore the relation is symmetric.
Also a R a is “a has the same mother as a”, which is true, therefore the relations
is reflexive.
Since the relation is Transitive, Symmetric and Reflexive, therefore it is an
Equivalence relation.
y+3
A20 (b) x =
2
y+3
Given, f(x) = 2x – 3. Let f(x) = y. Therefore, y = 2x – 3 ⇒ 2x = y + 3 ⇒ x =
2
3
A21 (b) x =
y −1

x +3 3
y=
⇒ xy = x + 3 ⇒ xy - x = 3 ⇒x=
x y +1
A22. (b)
The domain and range of {(x, y) : y = x2} is x can have any real value, therefore
Domain is set of Real numbers, but since y = x2 , therefore Range is set of
positive real numbers.
A23. [0, 1]
0 ≤ x ≤ 9 f(0) ≤ f(x) ≤ f (9)  log10 (1+0) ≤ f(x) ≤ log10 (1+9)
 log10 (1) ≤ f(x) ≤ log10 (10) 0 ≤f(x) ≤ 1
Therefore, range is [0, 1]
A24. (b) ax
y = loga (x) ⇒ x = ay
Replace x by f-1and y by x, we get f-1 = ax
A25. (a) Transitive
“Is taller than” over the set of men a R b is “a is taller than b”, b R c is “b is taller
than c”. This implies that “a is taller than c”, i.e. a R c, therefore the relation is
transitive.
 Relations and functions 236

But a R b is “a is taller than b” does not imply b R a is “b is taller than a”, because
a and b cannot be both simultaneously taller than each other, therefore the
relation is not symmetric.
Also a R a is “a is taller than a”, is not defined because a cannot be taller than
himself, therefore the relations is not reflexive.
A26. (b) Symmetric
“is perpendicular to” over the set of straight lines in a given plane is a R b is “a
is perpendicular to b”
b R c is “b is perpendicular to c”, this does not imply that “a is perpendicular
to c”, i.e. a R c, because a will be parallel to c. therefore the relation is not
transitive.
a R b is “a is perpendicular to b”, implies b R a i.e. “b is perpendicular to a”,
therefore the relation is symmetric.
Also a R a is “a is perpendicular to a”, which is meaningless, because a line
cannot be perpendicular to itself therefore the relations is not reflexive.
A27. (d) equivalence
“Is equal to” over the set of integers is a R b is “a = b”, b R c is “ b = c”;this
implies that “a = c”, i.e. a R c, therefore the relation is transitive. a R b is “a =
b”, it implies b R a i.e. “b = a”, therefore the relation is symmetric.
Also a R a is “a = a”, which is true, therefore, the relations is reflexive. Since the
relation is transitive, symmetric and reflexive, therefore it is an Equivalence
relation.
A28. (d) equivalence
“goes to same college as”…….. over a set of students a R b is “a goes to same
college as b”; b R c is “b goes to same college as c”, this implies that “a goes to
same college as c”, i.e. a R c, therefore the relation is transitive.
a R b is “a goes to same college as b” implies b R a i.e. “b goes to same college
as a”, therefore the relation is symmetric.
Also a R a is “a goes to same college as a”, which is true therefore the relations
is reflexive.
Since the relation is Transitive, Symmetric and Reflexive, therefore it is an
Equivalence relation.
A29 (b) symmetric
“is the reciprocal of”…….. over the set of non-zero real numbers is a R b is “a
is the reciprocal of b”
b R c is “b is the reciprocal of c”, this does not imply that “a is the reciprocal
of c”, i.e. a R c, because a will be equal to c as b is reciprocal of c, therefore
the relation is not transitive.
a R b is “a is the reciprocal of b” implies b R a i.e. “b is the reciprocal of a”,
therefore the relation is symmetric.
Also a R a is “a is the reciprocal of a”, which is meaningless, because a number
237 answers to fill in the blanks

cannot be a reciprocal of itself if it is not equal to 1, therefore the relations is

not reflexive.
A30. (d) none
“Is the cube of” over the set of real number is a R b is “a Is the cube of b”, a =
b3
b R c is “b Is the cube of c”, b = c3 therefore, a = (c3)3 = c9 this does not imply
that “a Is the cube of c”
therefore the relation is not transitive.
a R b is “a Is the cube of b”does not imply, b R a i.e. “b Is the cube of a”, therefore
the relation is not symmetric.
Also a R a is “a Is the cube of a”,which is meaningless, because a cannot be a
cube of itself if it is not equal to 1. therefore the relations is not reflexive.

ANSWERS TO FILL IN THE BLANKS

1. Subset
2. Domain
3. Range
4. 2mn
5. Reflexive
6. Symmetric
7. Transitive
8. Range (R), Domain R
9. Unique
10. Range
11. Even
12. Odd
13. Increasing
14. Decreasing
15. ax + b where a and b are constants and a ≠0
16. quadratic
17. R of real numbers, non- negative real numbers.
18. Demand
19. Direct
20. variable cost
21. zero
 C H A P T E R

9 Theory of Probability

Learning Objectives
By the end of this chapter, you will be able to understand:
u Meaning of Probability
u Understand the concept of experiment, sample point and sample space.
u Understand the meaning of event, mutually exclusive events, equally likely
events, exhaustive events, complementary events.
u Independent and dependent events.
u Different approaches to probability- classical approach, relative frequency
approach, subjective approach and modern approach.
u Important theorems of probability- Addition Theorem and Multiplication
theorem of probability
u Concept of conditional probability.
u Bayes’ Theorem

9.1 Introduction
The word probability is very common in everyday life. For instance, probability
that it may rain tomorrow, probability that India beat Australia in T-20 match
tomorrow, chances that BJP wins election this time etc. All the words such
as chance, possibility, probably etc., convey the same sense of uncertainty of
happening of the event. However under some conditions, a degree of certainty
can be assigned by a numerical value to the happening of the event. In this
chapter, we will discuss different approaches to probability, addition and mul-
tiplication theorem on probability, Baye’s theorem through different examples.

238
239 basic terminology Para 9.3

9.2 Meaning of Probability

Probability is an expression of likelihood or chance of occurrence of an un-
certain event.
In other words, Probability is the measure of the chance that an uncertain
event will occur. It takes on numerical values when considered in relation to
an experiment.

9.3 Basic Terminology

Experiment : An experiment is a well-defined procedure or a situation that
results in one of the possible outcomes. For instance, the experiment could be
tossing of a coin, throwing of a die, drawing a card from a well-shuffled pack
of 52 cards etc.
Sample Space: It is a set of all possible outcomes of an experiment. For example,
when a coin is tossed, the sample space is {Head, tail}.
Sample Point: Each possible outcome in a sample space is called sample point.
For example, In tossing of a coin, sample points are head and tail.
Event: An event is a sample point of the sample space in which we are interest-
ed. If an event contains only one element, it is called simple event. If an event
is made up of two or more sample points, it is called a compound event. A
compound event can be decomposed into a number of disjoint sample events.
Mutually Exclusive Events: Two or more events defined on a sample space are
said to be mutually exclusive if they cannot occur simultaneously. It means
that the happening of one event precludes the happening of the other. For
instance, in tossing of a coin, both head and tail cannot occur simultaneously
on the same toss.
Collectively Exhaustive Events: If the union or collection of two or more events
is equal to the sample space on which they are defined, they are said to be col-
lectively exhaustive. In other words, the events are said to be exhaustive when
their totality includes all the possible outcomes of a random experiment. For
example, there are 6 exhaustive number of cases in throwing a dice.
Equally Likely Events: Events are said to be equally likely if in no case, one is
preferred to the other. For instance, in tossing a coin, head and tail have equal
chances of coming up. So they are equally likely events.
Complementary Events: Two events E and e are said to be complementary
when the sample space is partitioned into two segments, one that represents
the occurrence of E and the other that is not a part of E. For instance, if a
person attempts to hit a target, then the events that he hits the target and he
fails to hit the target are complementary events since only one of these events
can occur in one trial and both cannot occur simultaneously.
Para 9.4 theory of probability 240

Independent events: Two or more events are said to be independent if the oc-
currence or non-occurrence of one event does not influence the occurrence
of the other. For example, event that it will rain tomorrow in India and India
will win the cricket match tomorrow in Australia are independent events.
Another example could be the tossing of a coin and throwing of a dice are
independent events.
Dependent Events: Two or more events are said to be dependent if the oc-
currence of one event influence the occurrence of the other. For example, if
a card is drawn from a deck of 52 cards without replacement, this will affect
the chances of second card drawn.

9.4 Different Approaches to Probability

Classical Approach to Probability: It is the oldest approach to probability. Since
the theory of probability had its origin in gambling games such as throwing a
die, tossing a coin, drawing cards from a deck of 52 cards etc., the method of
determining probabilities which was just developed was particularly appropriate
for such gambling situations. This method of measuring probability is called
classical or priori approach to probability. It is based on the assumption that all
possible outcomes of an experiment are mutually exclusive and equally likely.
According to this approach, if a trial results in n exhaustive, mutually exclusive
and equally likely cases and m of them are favourable to the happening of an
event E, then the probability of happening of E is given by
Favourable number of cases m
p = P (E ) = =
Total number of cases n
Since the number of cases favourable to happening of E is m and the exhaustive
number of cases is n, therefore the number of cases unfavourable to happening
E are n - m­. Then the probability that the event E will not happen is given by :
Unfavourable number of cases n − m m
q = P ( Ç) = = = 1− = 1− p
Exhaustive number of cases n n

or p + q = 1p
or p(E) + P( e ) = 1
Statistical or Relative Frequency Approach to Probability: The classical ap-
proach to probability is best suited for solving gambling problems but it does
not provide answers to a wide range of other types of problems. For instance,
it cannot tell the probability of producing defective items in a production run
or expected demand of a particular product. Such type of questions are an-
swered with the help of statistical data. The probability of such events can be
determined on the basis of past records of the frequency distribution. In the
19th century British statisticians became interested in computing risk involved
in life insurance and commercial insurance. For this, they used census data
241 Addition theorem of probability Para 9.5

on births and deaths. This approach of using statistical data or past records
is known as relative frequency approach. For instance, if a train comes daily
and past records shows that it was late on 21 days in the last year (365 days)
then the probability of its late coming is 21/365. According to Van Mises, If
an experiment is repeated a large number of times under essentially identical
situations, the limiting value of the ration of the number of times the event
A happens to the total number of trials of the experiments as the number of
trials increases indefinitely is called the probability of occurrence of A. Then
m
P (A ) = lim . We assume that limit is finite and unique.
n →∞ n
Subjective Approach to Probability: This approach views that the probability
of an event is a measure of the degree of belief or confidence that an inves-
tigator has in the happening of the event based on the evidence available to
him. This approach is of recent origin. It is also called personalistic approach to
probability. It is mainly used in forecasting demand price etc., on the basis of
subjective probabilities. The probability is determined between 0 and 1. If the
probability of an event is zero then it is called an impossible event. For example,
probability of falling a fan at a given time is zero. If the probability of an event
is one then that event is called a certain event or sure event.
Modern Approach to Probability: It is an axiomatic approach to probability.
It was introduced by Russian mathematician A.N Kolmogorov who define the
probability through certain axioms in his book “ Foundations of probability”.
It is based on three axioms which are as follows:
To every event A, there corresponds a real value P(A) called probability of
happening of event A which satisfy the following three axioms:
1. 0 ≤ P(A) ≤ 1
2. The probability of entire sample space is 1. It means that the sum of the
probabilities of all sample points constitutes sample space. We write as
P(S) = 1 where S is the sample space.
3. If A1, A2 , ……….An are n mutually exclusive events then
P(A1 ∪ A2 ∪ ........... ∪ An) = P(A1) + P(A2) + ..............+ P(An)
It simply means that the probability of a compound event is the sum of the
probabilities of simple events comprising the compound event.

9.5 Addition Theorem of Probability

Statement : Let A and B be any two mutually exclusive events then the prob-
ability that either A or B occurs is given by P(A ∪ B) = P(A) + P(B)
In particular, if A and B are not mutually exclusive then P(A ∪ B) = P(A) +
P(B) – P(A ∩ B)
Para 9.6 theory of probability 242

Proof: Let the event A can occur in p ways and B in q ways then the number
of ways in which either event can happen is p + q. if the total number of pos-
sibilities is n, then by definition of probability,
The probability of either A or B occurs =
Favourable number of cases p + q p q
= = + = P (A ) + P (B )
Totaln umber of cases n n n

∴ P(A or B) = P(A ∪ B) = P(A) + P(B)

Remark: In case of three events which are mutually exclusive, addition theo-
rem is given by :
P(A ∪ B ∪ C) = P(A) + P(B) + P(C)
If A , B and C are not mutually exclusive, then
P(A ∪ B ∪ C) = P(A) + P(B) + P(C) – P(A ∩ B) – P(B ∩ C) ‑ P(A ∩ C) + P(A ∩ B ∩ C)

9.6 Multiplication Theorem of Probability

Statement: The probability of simultaneous occurrence of two events A and
B is given by
P(A∩B) = P(A).P(B/A) provide P(A) ≠ 0
or P(B∩A) = P(B).P(A/B) provide P(B) ≠ 0
where P(B/A) is the conditional probability of B when A is known to have oc-
curred. Similarly P(A/B) is the probability of A given that B has already occurred.
Proof: Let S be a sample space with n elements. Let A and B are any two
events in S.
n (A ∩ B )
Then, P ( A ∩ B ) =  ……….(i)
n (S )
n (A ∩ B )
For the event A/B, B is the sample space then P(A/B) = ………(2)
n (B )
n (A ∩ B )
Similarly, P(B/A) =  ………(3)
n (A )
n (A ∩ B ) n (A )
From (1), we have P ( A ∩ B ) = .
n ( A ) n (S )

= P(B/A).P(A) From (3)

n (A ∩ B ) n (B )
Similarly, P ( A ∩ B ) = .
n ( B ) n (S )
= P(A/B).P(B From (2)
243 Bayes’ theorem Para 9.8

Multiplication theorem for independent events: It states that if A and B are any
two independent events then the probability that both will occur simultaneously
is equal to the product of individual probabilities.
Symbolically, P(A ∩ B) = P(A).P(B)
Proof: Let A be the event can occur in m ways out of which a1 are successful
and B be the event that can occur in n ways out of which a2 are successful then
the total number of successful happenings in both cases is a1 × a2
Probability of simultaneous occurrence of both the events is
a1 × a 2 a1 a 2
= × = P (A ).P ( B )
m ×n m n
Therefore, P(A and B) = P(A)P(B)

9.7 Conditional Probability

If A and B are any two dependent events such that B can occur only when A
is known to have occurred. Then the conditional probability or probability of
B given that A has happened is denoted by P(B/A) and is given by

P (A ∩ B )
P (B / A ) = , P (A ) ≠ 0
P (A )
Similarly, the probability of A given that B has already occurred is given by
P (A ∩ B )
P (A / B ) = , P (B ) ≠ 0
P (B )
Multiplication Theorem of Probability:
For any two events A and B,
P(A ∩ B) = P(A)P(B/A), if P(A) ≠ 0
Or P(A ∩ B) = P(B)P(A/B), if P(B) ≠ 0

9.8 Bayes’ Theorem

Bayes rule may be viewed as a means of transforming our priori probability
of an event into posteriori probability of that event. Bayes’ theorem can be
stated as :
If A1, A2, ............ An be a set of n mutually exclusive and exhaustive events. If B
is another event such that P(B) ≠ 0 then

P ( B / Ai )P (Ai )
P (Ai / B ) = n

∑ P (B / A )P (A )
i =1
i i
Para 9.6 theory of probability 244

Example 1: (Classical Approach) What is the probability of drawing a jack from

a deck of 52 cards?
Solution: There are 4 jacks in a deck of 52 cards. So the number of favourable
cases is 4 and the total number of cases is 52. Then by classical approach to
probability, probability of drawing a jack is 4/52.

Example 2: (Classical Approach) If two dice are thrown simultaneously, find the
probability of throwing :

1. A doublet 2. Total of 9 3. Two six 4. Not throwing a total of 9.

Solution: If two dice are thrown simultaneously then total number of cases is 36.
1. Favourable outcomes are (1,1); (2,2); (3,3);(4,4);(5,5);(6,6). Therefore,
favourable number of cases are 6 . Then by classical approach to
probability, P(a doublet) = 6/36 or 1/6
2. A total of 9 can occur in the following ways:
(4,5); (5,4); (6,3); (3,6)
Therefore, favourable number of cases is 4. Then probability of getting
a total of nine is 4/36 or 1/9
3. The probability of having two six (6,6) is 1/36.
4. Probability of not throwing a total of nine = 1 – 1/9 = 8/9

Example 3: (Classical Approach) What is the probability of drawing a face card

in a single draw from a pack of 52 cards.
Solution: Face cards include 4 king, 4 queen and 4 jack. There are 12 face cards.
Favourable number of cases is 12. Then probability of drawing a face card in
a single draw from a pack of 52 cards = 12/52

Example 4: (Addition Theorem) A card is drawn from a pack of 52 cards. What

is the probability that it is either a spade or an ace?
Solution: Let S be the event that the card drawn is a spade. Then P(S) = 13/52
Let A be the event that the card drawn is an ace then P(A) = 4/52
A and S are not mutually exclusive, P(S∩A) = 1/52. We find P(S ∪ A)
Then by addition theorem, P(S ∩ A) = P(S) + P(A) – P(S ∩ A)
13 4 1 16
⇒ P (S ∪ A ) = + − =
52 52 52 52
Example 5: (Addition theorem) A college has invited applications for the post of an
assistant professor. The probability that an applicant has research experience
is 0.3 and that he has adequate work experience is 0.7 and that he has both
research experience and work experience is 0.4. Assuming that 50 persons have
applied for this post in the college, find out how many applicants would have
either research experience or work experience.
245 Bayes’ theorem Para 9.8

Solution: Let A be the event that the applicant has research experience then
P(A) = 0.3
Let B be the event that the applicant has work experience then P(B) = 0.7
Probability that the applicant has both research and work experience = P(A∩B)
= 0.4
We find the probability that an applicant has either research or work experi-
ence = P(A ∪ B) = ?
By addition theorem, P(A ∩ B) = P(A) + P(B) – P(A ∩ B)
⇒ P(A ∪ B) = 0.3 + 0.7 – 0.4 = 0.6
Number of applicants having either research or work experience = 0.6 × 50 = 30

Example 6: An insurance salesman sells policies to 5 men all of identical age and
good health. According to the actuarial tables, the probability that a man of
this particular age will be alive 30 years hence is 2/3. Find the probability that
30 years hence :
(a) At least 1 man will be alive
(b) At least 3 men will be alive
Solution: (a) P (At least one man will be alive) = 1 - P(none will be alive)
5
1 1 242
= 1−   = 1− =
 3 243 243
(b) P(at least three men will be alive) = P(X = 3) + P(X = 4) +P(X = 5)
3 5− 3 4 5− 4 5 5− 5
2 1 2 1 2 1
= 5C 3     + 5C 4     + 5C 5    
 3  3  3  3  3  3
 8  1   16  1   32 
= 10    + 5    + 
 27  9   81  3   243 


 80   80   32  192
= + + =
 243   243   243  243

Example 7: A speaks the truth 2 out of 3 times and B speaks truth 4 out of 5 times.
They agree that from a bag of 6 balls of different colors, a black ball has been
drawn. Find the probability that the statement is true.
Solution: Let A be the event that A speaks truth then P(A) = 2/3 and P( A ) = 1/3

Let B be the event that B speaks truth then P(B) = 4/5 and P( B ) = 1/5
They will agree when both speak truth or both tell a lie.
2 4 1 1 9
Let C be the event that they both agree = P (A )P ( B ) + P (A )P ( B ) = × + × =
3 5 3 5 15
Para 9.8 theory of probability 246

2 4
×
3 5 8
Probability that the statement is true = =
2 4 1 1 9
× + ×
3 5 3 5
Example 8: The odds against A solving a problem are 10 to 7 and the odds in
favour of B solving the problem are 15 to 12. What is the probability that if
both of them try the problem will be solved?
Solution: We are given that P(A)= P(A solves the problem) = 7/17 Then P
( A ) = 10/17
P(B) = P(B solves the problem) = 15/27 Then P( B ) = 12/17
The problem will be solved when at least one of them solves the problem.
P(At least one solves the problem ) = 1-P(none solves)
10 12 
=1-[P( A )P( B ) = 1-  ×  = 1-0.2614 = 0.7386
17 27 
Example 9:An urn contains 9 red, 7 white and 4 black balls. If two balls are
drawn at random , find the probability that (a) Both balls are red (b) One ball
is white (c) Balls are of same colour.
Solution: There are 9 + 7 + 4 = 20 balls in the urn. Number of ways in which
two balls can be drawn out of 20 balls is 20C2
(a) Probability that both balls are red
9
C 9! 2!18! 9 × 8 × 7 ! 2 × 18! 18
= 20 2 = × = × =
2!7 ! 20 ! 2 7 ! 20 19 18! 95
C 2
× × ×

(b) Probability that one ball is white mean one is white and other ball is non-
white. Its probability is
7
C1 × 13C1 7 × 13 × 2!18! 7 × 13 × 2 × 18! 91
= 20
= = =
C2 20 ! 20 × 19 × 18! 190

(c) Probability that balls are of same colour means that either both balls are
red or white or black. Its probability is
9×8 7×6 4×3
9 7 4 + +
C C C 2 2 2 = 72 + 42 + 12 = 63
= 20 2 + 20 2 + 20 2 =
C2 C2 C2 20 × 19 380 190
2

Example 10: A box contains 50 tickets numbered 1,2,3…..50. Five tickets are drawn
at random and arranged in ascending order of magnitude (x1 < x2 <x3 <x4 <x5).
Find the probability that x3 = 30
247 Bayes’ theorem Para 9.8

Solution: Number of ways in which 5 tickets can be drawn out of 50 tickets are 50C5
If x3 = 30 then the first two tickets x1 and x2 must come from tickets numbered
1 to 29. This can be done in 29C2ways. Then the last two tickets x4 and x5 will
be drawn from the tickets numbered 31 to 50. This can be done in 20C2 ways.
Therefore, favourable number of cases = 29C2×20C2

29 × 28 20 × 19
29
C 2 × 20C 2 2
×
2 406 × 190 551
Required probability = = = =
50
C5 50 × 49 × 48 × 47 × 46 2118760 15134
5 × 4 × 3 × 2 ×1

Example 11: Odds against a person who is 40 years old living till he is 70 is 8 to 5.
Odds against another person now 50 he will be living till 80 is 4 to 3. Find the
probability that one of them will be alive next 30 years.
Solution: Probability that first man will be alive for next 30 years = 5/13
Probability that second man will be alive for next 30 years = 3/7
5 4 3 8 44
P(only one of them live for next 30 years) = × + × =
13 7 7 13 91

Example 12: Find the probability that a leap year selected at random contains 53
Sundays.
Solution: There are 366 days in a leap year which consists of 52 weeks and 2 days.
52 weeks contains 52 Sundays. The remaining days can be any of the following:
1. Mon , Tue
2. Tue, Wed
3. Wed, Thu
4. Thu, Fri
5. Fri, Sat
6. Sat, Sun
7. Sun , Mon
Sunday occurs in 2 cases out of 7 cases in all. Thus, Probability of 53 Sundays
= 2/7

Example 13: A speaks truth in 75% cases and B in 80% of the cases. In what
percentage of cases they are likely to contradict each other?
Solution: Let A be the event that A speaks truth=P(A) = 0.75.

Then probability that A does not speak truth = P( A ) = 1‑P(A) = 1‑0.75 = 0.25
Let B be the event that B speaks truth=P(B) = 0.80.
Then probability that B does not speak truth = P( B ) = 1‑P(B) = 1-0.80 = 0.20
Para 9.8 theory of probability 248

They contradict each other means that only one of them is speaking truth at
a time.
Probability that they contradict each other = P(A)P( B ) + P( A )P(B) = 0.75 ×
0.20 + 0.25 × 0.80 = 0.35

Example 14: (Independent events) If P(A) = 0.2, P(B) = 0.3 and P(AUB) = 0.4,the
events A and B are independent. Comment upon the statement.
Solution: By addition theorem, P(A ∪ B) = P(A) + P(B) – P(A ∩ B)
 0.4 = 0.2 + 0.3 – P(A ∩ B)
 P(A ∩ B) = 0.1 .......(i)
By Multiplication theorem, if A and B are independent then P(A ∩ B) = P(A)P(B)
= 0.2 × 0.3 = 0.06 which is contradictory to (i). So the given statement is false.

Example 15: (Complementary events) You note that your officer is happy on 60%
of your calls, so that you assign a probability of his being happy on your visit
as 0.6. You have noticed that if he is happy, he accedes to your request with a
probability of 0.4 whereas if he is not happy, he accedes to the request with a
probability of 0.1. You call one day and he acedes to your request. What is the
probability that he is happy?
Solution: The given data can be represented as :

Request ↓ Happy (60%) Not happy (40%) Total

Mood→
Accepted 0.6 × 0.4 = 0.24 0.4 ×0.1 = 0.04 0.28
Not accepted 0.6 × 0.6 = 0.36 0.4 × 0.9 = 0.36 0.72
Total 0.60 0.40 1.00
Probability that your officer is happy when he accepts your request on a par-
0.24 6
ticular day = =
0.28 7
Example 16: (Addition theorem and conditional probability) Among the examinees
in an examination, 30%, 35% and 45% failed in Statistics, in Mathematics and
in at least one of the subjects respectively. An examinee is selected at random.
Find the probabilities that :
(i) He is failed in Mathematics only.
(ii) He passed in Statistics if it is known that he failed in Mathematics.
Solution: P(S) = 0.30, P(M)= 0.35, P(S ∪ M) = 0.45
By addition theorem on probability,
P(S ∪ M) = P(S) + P(M) – P(S ∩ M)
 0.45 = 0.3 + 0.35 – P(S ∩ M)
249 Bayes’ theorem Para 9.8

 P(S ∩ M) = 0.2
Probability that he passed in Mathematics only = P(M) – P(S∩M) = 0.35 – 0.2
– 0.15
(ii)

P(M) = P(S ∩ M) + P( S ∩ M)
⇒ 0.35 = 0.2 + P( S ∩ M)

⇒ P( S ∩ M) = 0.35 – 0.2 = 0.15

Probability that he passed in Statistics if it is known that he failed in Mathe-
matics =
P (S ∩ M ) 0.15 3
P (S / M ) = = =
P (M ) 0.35 7

Example 17: (Conditional probability) A box of 100 gaskets contains 10 gaskets

with type A defect, 5 gaskets with type B defect and 2 gaskets with both types
of defect. Find the probabilities that:
(i) A gasket to be drawn has a type B defect under the condition that it has
a type A defect and
(ii) A gasket to be drawn has no type of defect under the condition that it
has no type A defect.
Solution: P(A) = 10/100 = 0.1 and P(B) = 5/100 = 0.05, P(A∩B) = 2/100 = 0.02
(i) A gasket to be drawn has a type B defect under the condition that it has
a type A defect =P(B/A)
P (A ∩ B ) 0.02
P (B / A ) = = = 0.2
P (A ) 0.1

(ii) A gasket to be drawn has no type of defect under the condition that it
has no type A defect =
P (A ∩ B ) 1 − P ( A ∪ B ) 1 − [P ( A ) + P ( B ) − P ( A ∩ B )

P (B / A ) = = =
P (A ) 1 − P (A ) 1 − P (A )

1 − 0.1 + 0.05 − 0.02

=
1 − 0.1
1 − 0.13
= = 0.966
0.9
Example 18: (Conditional probability) Two factories manufacture the same machine
parts. Each part is classified as having either 0, 1, 2 or 3 manufacturing defects.
The joint probability for this is given below:
Para 9.8 theory of probability 250

Number of defects

Manufacturer ↓ 0 1 2 3
X 0.1250 0.0625 0.1875 0.1250
Y 0.0625 0.0625 0.1250 0.2500

(i) A part is observed to have no defect. What is the probability that it was
produced by X manufacturer?
(ii) A part is known to have been produced by manufacturer X. What is the
probability that the part has no defect?
(iii) A part is known to have two or more defects. What is the probability that
it was manufactured by X?
(iv) A part is known to have one or more defects. What is the probability that
it was manufactured by Y?
Solution:

Manufacturer ↓ 0 1 2 3 Total ↓
X 0.1250 0.0625 0.1875 0.1250 0.5
Y 0.0625 0.0625 0.1250 0.2500 0.5
Total→ 0.1875 0.1250 0.3125 0.375 1.0
(i) Let A be the event that a part has no defect. Then we find P(X/A)
P (X ∩ A ) 0.1250
P (X / A ) =
= = 0.67
P (A ) 0.1875

P (X ∩ A ) 0.1250
(ii) P (A / X ) = = = 0.25
P (X ) 0.5
(iii) Let B be the event that two or more defects are produced. Then we find
P(X/B)
P (X ∩ B ) 0.1875 + 0.1250

P (X / B ) = = = 0.4545
P (B ) 0.3125 + 0.3750
(iv) Let C be the event that one or more defects are produced. Then we find
P(Y/C)
P (Y ∩ C ) 0.0625 + 0.1250 + 0.2500
P (Y / C ) =
= = 0.5385
P (C ) 0.1250 + 0.3125 + 0.3750

Example 19: (Conditional probability) The probability that a person stopping at

a petrol pump will get his tyres checked is 0.12, the probability that he will get
his oil checked is 0.29 and the probability that he will get both checked is 0.07.
251 Bayes’ theorem Para 9.8

(i) What is the probability that a person stopping at this pump will have
neither his tyres checked nor oil checked.
(ii) Find the probability that a person who has oil checked, will also have his
tyres checked.
Solution: Let B1 be the event that tyres are checked then P(B1) = 0.12
Let B2 be the event that oil is checked then P(B2) = 0.29 and P(B1 ∩ B2) = 0.07
(i) Probability that a person stopping at this pump will have neither his tyres
checked nor oil checked
P( B1 ∪ B 2 ) = 1 ‑ P(B1 ∪ B2) = 1 ‑ [P(B1) + P(B2) – P(B1 ∩ B2)]
= 1-[0.12 + 0.29 – 0.07]
= 0.66
(ii) Probability that a person who has oil checked, will also have his tyres
checked =
P ( B1 ∩ B 2 ) 0.07
P ( B1 / B 2 ) =
= = 0.24
P (B2 ) 0.29

Example 20: (Baye’s theorem) A company has two plants to manufacture cars.
Plant A manufactures 70% of the cars and plant B manufactures 30%. At plant
A, 80% of cars produced are of standard quality and at plant B , 90% of cars
are of standard quality. A car is picked up at random and is found to be of
standard quality. What is the chance that it has come from plant B?
Solution: Let A be the event that car is manufactured by Plant A then P(A) = 0.70
Let B be the event that car is manufactured by Plant B then P(B) = 0.30
Let E be the event that the car is of standard quality. Then P(E/A) = 0.80,
P(E/B) = 0.90
Then P(E) = P(E/A)P(A) + P(E/B)P(B) = 0.8 × 0.7 + 0.9 × 0.3 = 0.83
We find P(B/E) .
P ( B ∩ E ) P (E / B )P ( B ) 0.90 × 0.30
P (B / E ) = = = = 0.3253
P (E ) P (E ) 0.83

Example 21: (Baye’s theorem) If a machine is correctly set-up, it produces 90%

acceptable items. If it is incorrectly set-up, it produces 40% acceptable items.
Experience shows that 80% of the set-ups are correctly done.
(i) If after a certain set-up, out of the first two items produced, first is found
to be acceptable and second unacceptable, what is the probability that
the machine is correctly set-up?
(ii) If the machine produced first two items as acceptable, what is the
probability that the machine is correctly set-up?
Para 9.8 theory of probability 252

Solution: Let B1 be the event that the machine is correctly set-up then P(B1) = 0.8
Let B2 be the event that the machine is incorrectly set-up then P(B2) = 0.2
Let A be the event that the first item is acceptable and second item is unac-
ceptable.
Then P(A/B1) = 0.9 × 0.1 = 0.09 and P(A/B2) = 0.4 × 0.6 = 0.24
P ( B1 ∩ A ) 0.8 × 0.9 × 0.1 0.072
(i) P ( B1/A ) = = = = 0.6
P (A ) 0.8 × 0.9 × 0.1 + 0.2 × 0.4 × 0.6 0.012
(ii) Let A be the event that the first two items are acceptable then P(A/B1) =
0.8×0.9×0.9 and P(A/B2) = 0.2×0.4×0.4
P ( B1 ∩ A ) 0.8 × 0.9 × 0.9 0.648
P ( B1 / A ) =
= = = 0.953
P (A ) 0.8 × 0.9 × 0.9 + 0.2 × 0.4 × 0.4 0.680

Example 22: (Conditional probability, Baye’s theorem) What is conditional

probability?
The contents of urn I, II and III are as follows:
1white, 2 black and 3 red balls; 2 white, 1 black and 1 red balls; 4 white, 5 black
and 3 red balls. One urn is chosen at random and two balls are drawn. They
happen to be a white and a red. What is the probability that they come from
(i)urn I (ii) urn II.
Solution: Conditional Probability: Two events A and B are said to be dependent
when B can occur only when A is known to have occurred. The probability
attached to such an event is called conditional probability and is denoted by
P (A ∩ B )
P(A/B) and is given by P (A / B )
P (B )
Let E1 ,E2, E3 be the events that urn I, II and III are chosen. Then P(E1) = P(E2)
= P(E3) = 1/3
Let A be the event that one red and one white ball is drawn.
1
C1 × 3C1 1 2
C1 × 1C1 1 4
C1 × 3C1 2
P (A / E1 ) = 6
= , P ( A / E 2 ) = 4
= , P ( A / E 3 ) = 12
=
C2 5 C2 3 C2 11

1 1 2 118
P(A) = P(E1)P(A/E1) + P(E2)P(A/E2) + P(E3)P(A/E3) = + + =
5 3 11 165
Probability that one white and one red ball came from Urn I
P (E1 ∩ A )
= P (E1 /A ) =
P (A )
1 1
×
P (E1 )P (A/E1 ) 3 5 33
= = =
P (A ) 118 118
165
253 objective type questions

Probability that one white and one red ball came from Urn II
P (E 2 ∩ A )
= P (E 2 /A ) =
P (A )
1 1
×
P (E 2 )P (A/E 2 ) 3 3 55
= = =
P (A ) 118 118
165

Example 23: (Bayes’ Theorem) In a class of 75 students, 15 were considered to be

very intelligent, 45 as medium and rest below average . The probability that a
very intelligent student fails in a viva-voce examination is 0.005. The medium
student failing has a probability 0.05 and the corresponding probability for a
below average student is 0.15. If a student is known to have passed the viva-
voce examination, find the probability that he is below average?
Solution: Let A be the event that a student is very intelligent then P(A) = 15/75 = 0.2
Let B be the event that a student is medium then P(B) = 45/75 = 0.6
Let C be the event that a student is below average = P(C) = 15/75 = 0.2
Let E be the event that a student passed in viva-voce examination.
P(E/A) = 1-0.005 = 0.995, P(E/B) = 1 – 0.05 = 0.95, P(E/C) = 1- 0.15 = 0.85

P (C )P (E / C )
P (C / E ) =
P (A )P (E / A ) + P ( B )P (E / B ) + P (C )P (E / C )

0.2 × 0.85
= = 0.181
0.2 × 0.995 + 0.6 × 0.95 + 0.2 × 0.85

OBJECTIVE TYPE QUESTIONS

Q1. A card is drawn from a pack of 52 cards. The probability that it is either a
spade or a king is:
(a) 1/26 (b) 3/26 (c) 4/13 (d) 3/13
Q2. Two cards are drawn one by one from a well shuffled pack of 52 cards without
replacement. The probability that both cards are aces is:
(a) 2/13 (b) 1/221 (c) 2/43 (d) 1/51
Q3. Two dice are thrown simultaneously. The probability of obtaining a total of 5
is:
(a) 1/12 (b) 1/9 (c) 1/18 (d) none
Q4. Two dice are thrown simultaneously. The probability of obtaining a total of 7 is:
(a) 1/6 (b) 7/36 (c) 5/36 (d) none
 theory of probability 254

Q5. Two dice are thrown simultaneously. The probability of obtaining a total of
10 is:
(a) 1/12 (b) 1/9 (c) 6/36 (d) none
Q6. If A, B and C hit a target 4 times in 5 shots, 3 times in 4 shots, 2 times in 3 shots
respectively. Then the probability that exactly two of them will hit the target
is :
(a) 13/30 (b) 5/16 (c) 17/30 (d) 4/30
Q7. In above question 6, the probability that at least one of them hit the target is
:
(a) 59/60 (b) 1/60 (c) 17/30 (d) none
Q8. In above question 6, the probability that exactly one of them hit the target is :
(a) 19/60 (b) 9/60 (c) 17/30 (d) none
Q9. The probability of a problem being solved by two students are ½ and 1/3
respectively. The probability that the problem is solved is :
(a) 4/3 (b) 1/3 (c) 2/3 (d) none
Q10. In question 9 above, the probability that the problem is solved by exactly one
of them is :
(a) 1/6 (b) 1/3 (c) 3/6 (d) none
Q11. In question 9 above, the probability that the problem is solved by both A and
B is :
(a) 1/6 (b) 1/3 (c) 3/6 (d) none
Q12. A die is rolled. The probability that the number obtained is 1 or 5 is :
(a) 2/3 (b) 5/6 (c) 2/6 (d) none
Q13. The probability of three mutually exclusive events A, B and C are given by
2/3, ¼,1/6 respectively. The statement :
(a) is true (b) is false
(c) nothing can be said (d) could be either
Q14. The probability of an event happening in one trial of an experiment is 0.6.
Three independent trials are made. The probability that the event happens at
least once is:
(a) 0.432 (b) 0.064 (c) 0.936 (d) none
Q15. One of the two events must occur. If the chance of one is 2/3 of the other,
then odds in the favour of the other are:
(a) 1:3 (b) 2:3 (c) 3:2 (d) none
Q16. The odds in the favour of A solving a problem are 3:4 and the odds against B
solving the same problem are 5:7. If they both try, the probability that problem
is solved is:
(a) 16/21 (b) 5/21 (c) 1/4 (d) none
255 objective type questions

Q17. The probability of solving a problem by three students A, B and C are ½, 1/3,
¼ respectively. The probability that the problem will be solved:
(a) 1/4 (b) ½ (c) 3/4 (d) none
Q18. A die and two coins are tossed. The probability that both the coins show heads
and the die shows 3 or 4 is :
(a) 7/12 (b) 4/7 (c) 1/12 (d) 2/12
Q19. The probability that Ram will be alive 15 years hence is 7/15 and Shyam will
be alive is 7/10. The probability that both Ram and Shyam will be dead 15
years hence is :
(a) 49/150 (b) 24/150 (c) 21/150 (d) none
Q20. The probability of getting exactly 2 tails in 6 tosses of a fair coin is :
(a) 3/8 (b) 15/64 (c) 1/4 (d) none
Q21. The probability of getting 2 heads and 2 tails when 4 coins are tossed is :
(a) 1/2 (b) 6/16 (c) 1/16 (d) none
Q22. Two cards are drawn from a pack of 52 cards at random. The probability that
one is a king and the other is a queen is:
(a) 8/663 (b) 4/52 (c) 2/52 (d) none

1 1 1
Q23. If P(A) = , P(B) = , P(A ∪ B) = then P(A ∩ B) =
4 2 4
(a) 1/8 (b) 1/2 (c) 5/8 (d) none
Q24. Among the workers in a factory, only 30% receive bonus and among those
receiving bonus, only 20% are skilled. The probability that a randomly selected
worker is skilled and is receiving bonus is:
(a) 0.02 (b) 0.03 (c) 0.06 (d) none
Q25. A bag contains 5 red and 4 green balls. Three balls are drawn out at random.
The probability that balls are of same colour is :
(a) 1/6 (b) 10/84 (c) 4/84 (d) none
Q26. A bag contains 5 white and 3 green balls. Four balls are drawn out at random.
The probability that equal number of white and green balls are among them is :
(a) 3/7 (b) 10/70 (c) 3/70 (d) none
Q27. Six ladies seat themselves at one side of a table. The probability that two
particular ladies will be next to each other is :
(a) 1/3 (b) 1/6 (c) 1/5 (d) none
1 5 1
Q28. If P( B ) =
, P(A ∪ B) = , P(A ∩ B) = then the events A and B are:
2 6 3
(a) independent (b) dependent
(c) cannot say anything (d) mutually exclusive
 theory of probability 256

Q29. Seven ladies seat themselves at a round table. The probability that two particular
ladies will be next to each other is :
(a) 1/3 (b) 1/6 (c) 1/5 (d) none
Q30. Three faces of a fair die are yellow, two faces red and one blue. The die is
tossed three times. The probability that the colours yellow, red and blue appear
in the first, second and third tosses respectively is :
(a) 1/36 (b) 3/6 (c) 1/6 (d) none
Q31. Six boys and six girls are to sit in a row, the probability that they sit alternately
is :

6! × 7 P6
(a) 5040/12! (b) (c) 6!/12! (d) none
12!
Q32. An urn contains 5 white and 7 black balls. Another urn contains 4 white and
6 black balls. If an urn is chosen at random and a ball is drawn from it then
the probability that it is white is :
(a) 1/9 (b) 20/120 (c) 49/120 (d) none
Q33. If A and B are two events, then P(neither A nor B) equals :
(a) 1‑P(A ∪ B) (b) P( A ) + P( B )
(c) 1‑P(A) –P(B) (d) none
Q34. A bag contains 5white and 4 black socks. 2 socks are pulled out at random.
The probability that they match is :
(a) 4/9 (b) 5/9 (c) 7/12 (d) none
Q35. Three unbiased dice are thrown. The probability that the same number appear
on each of them is :
(a) 1/6 (b) 1/36 (c) 1/18 (d) none
Q36. The probability that at least one of the events A and B occurs is 0.6. If A and
B occur simultaneously with probability 0.2 then P( A ) + P( B ) is :
(a) 0.2 (b) 0.8 (c) 0.4 (d) 1.2
Q37. The odds against a certain event are 5:2 and the odds in favour of another
independent event is 6:5. The probability that at least one of the events will
happen is:
(a) 25/77 (b) 52/77 (c) 12/77 (d) none
Q38. The probability that an event happens in one trial of an experiment is 0.4. Three
independent trials of an experiment are performed. The probability that the
event A happens at least once is :
(a) 0.936 (b) 0.784 (c) 0.904 (d) none
Q39. An insurance company insured 2000 scooter drivers, 4000 car drivers and 6000
truck drivers. The probability of their accident is 0.1,0.3 and 0.2 respectively.
One of the insured persons met with an accident. What is the probability that
he is a scooter driver?
257 objective type questions

(a) 1/13 (b) 0.083 (c) 25/54 (d) none

Q40. Urn I contains 3 defective and 7 non- defective items. Urn II contains one
defective and nine non-defective items. We select an urn at random and then
draw one item from the urn. What is the probability that a non- defective item
is drawn.
(a) 16/20 (b) 9/10 (c) 16/20 (d) 7/10
Q41. In question number 40, what is the probability that a defective item is drawn?
(a) 4/20 (b) 3/10 (c) 1/10 (d) none
Q42. In question number 40, what is the probability that an Urn I was chosen given
a defective item is drawn.
(a) 3/20 (b) 4/20 (c) 3/4 (d) none
Q43. Box 1 contains 8 black and 2 white balls. Box 2 contains 3 black and 7 white
balls. Box 3 contains 5 black and 5 white balls. A fair die is to be cast. If die
turns up 1,2 and 3 then a ball is selected from box 1. If die turns up 4 or 5 , a
ball is selected from Box 2. If die turns up 6 then the ball will be selected from
box3. What is the probability that the ball is selected from box2 given that the
ball drawn is black.
(a) 6/35 (b) 29/35
(c) data is insufficient (d) none
Q44. In a reservation office, two clerks are engaged in checking reservation forms.
On an average, the first clerk checks 55% of the forms while the second does
the remaining. The first clerk has an error rate of 0.03 and second has an error
rate of 0.02. A reservation form is selected at random from the total number of
forms checked during a day and is found to have an error. Find the probability
that it was checked (i) by the first (b) by the second clerk.
(a) 0.353, 0.647 (b) 0.647, 0.353 (c) 0.647, 0.647 (d) none
Q45. In a factory, machine M1, M2, M3 manufacture 25%, 35%, 40% of the total
output. Out of their output, 5%, 4%, 2% are defective items. An item is drawn at
random from the output and is found to be defective. What is the probability
that it is manufactured by machine M1, M2 and M3?
(a) 0.36, 0.41, 0.23 (b) 0.41, 0.23, 0.36
(c) 0.23, 0.36, 0.41 (d) none
Q46. In a factory, certain parts are to be fixed to the chasis in a section before it
moves into another section. On a given day, one of the three persons, A, B and
C carries out this task. A has 45% , B has 35% and C has 20% chance of doing
it. The probabilities that A, B and C will take more than the allotted time are
1/16, 1/10 and 1/20 respectively, if it is found that none of them has taken
more time, what is the probability that A has taken more time?
(a) 5/13 (b) 8/13 (c) 1/16 (d) none
Q47. Suppose that there is a chance for a newly constructed house to collapse
whether the design is faulty or not. The chance that the design is faulty is 20%.
 theory of probability 258

The chance that the house collapse if the design is faulty is 98% and otherwise
it is 25%. It is seen that the house collapsed. What is the probability that it is
due to faulty design?
(a) 0.4949 (b) 0.5050 (c) 0.98 (d) none

1 1
Q48. If P(A ∩ B) = , P( A ∩ B ) = , 2P(A) = P(B) = p then the value of p is :
2 2
(a) ¼ (b) 1/2 (c) 1/3 (d) 2/3

1 1
Q49. If P(A ∩ B) = , P( A ∩ B ) = , P(A) = P(B) = p then the value of p is :
2 3
(a) 7/8 (b) 1/2 (c) 1/3 (d) 7/12

Q50. If A and B are two independent events such that P(A ∪ B) = 0.8, P( A ) = 0.7,
P( B ) = k then the value of k is :
(a) 5/7 (b) 2/7 (c) 1 (d) none

FILL IN THE BLANKS

1. One card is drawn from a pack of 52 cards. The probability that the card
drawn is an ace is ____________
2. One card is drawn from a pack of 52 cards. The probability that the card
drawn is either red or king is _________________
3. One card is drawn from a pack of 52 cards. The probability that the card
drawn is both red and king is_________
4. Suppose we have a box with 3 red, 2 black and 5 white balls. Each time a ball
is drawn, it is returned to the box. Then the probability of drawing either a red
or a black ball is ____________ and probability that it is either white or black
is _______________
5. An educational institution has offered admission to 100 students. On an
average, the institution found 20 students secure grade A, 25 students grade
B, 20 students grade C and 35 students grade D. The probability of selecting
a student who has either grade A or B is ______________and either grade C or
D is _______
6. X is a registered contractor with the government. Recently, X has submitted
his tender for two contracts A and B. The probability of getting the contract
A is ¼ , the contract B is ½ and both contracts A and B is 1/8. The probability
that X will get contractor A or B is _______________.
7. A card is drawn from a pack of 52 cards. Then the probability that it will be
a diamond or jack is ____
8. A card is drawn from a pack of 52 cards. Then the probability of drawing a
queen of spade or king of heart is _____________
259 Fill in the blanks

9. A bag contains 5 red and 4 green socks. Two socks are drawn at random
from the bag. Find the probability that the drawn socks are of same color is
_______________
10. Two cards are drawn from a pack of 52 cards. Then the probability that either
both are red or both are queens is _______________
11. The probability that X passed in Mathematics is 2/3. The probability that
he passed in statistics is 4/9. The probability that he passed in at least in
one subject is 4/5. Then the probability that he passed in both subjects is
______________________
12. A problem is given to two students A and B. Their chances of solving it
correctly are 0.4 and 0.9 respectively. The probability that both of them solve
it is______________
13. A company employs a total of 140 engineers, of whom 72 are males and
remaining are females. Of the female engineers, 28 are under 35 years of age,
30 are between 35 and 45 years of age and the remaining are over 45 years.
Then the probability that a randomly selected engineer is a female under 35
years of age is_______________
14. The probability that a vowel selected at random from an English book is e
is________
15. Ten digits are marked 0 to 9 are marked on 10 cards, one digit being marked
on one card only. Cards are then thoroughly mixed in a box. If a card is
drawn at random, Then the probability that the card has an odd digit on it is
____________________
16. The probability of drawing a black card in a single draw from 52 cards is
___________
17. In a simultaneous toss of two coins, find the probability of getting two heads
is _____
18. In a simultaneous toss of two coins, find the probability of getting exactly one
head is _________
19. In a simultaneous toss of two coins, find the probability of getting exactly two
heads is _____
20. In a simultaneous toss of two coins, find the probability of getting one tail is
_____
21. In a simultaneous toss of two coins, find the probability of getting no tail is
__________.
22. Three coins are tossed once, the probability of getting all heads is ___________
23. Three coins are tossed once, the probability of getting at least two heads is
_________
24. Three coins are tossed once, the probability of getting at most two heads is
___________
25. Three coins are tossed once, the probability of getting no heads is ___________
26. Three coins are tossed once, the probability of getting exactly one tail is ________
 theory of probability 260

27. Three coins are tossed once, find the probability of getting exactly two heads
is ___________
28. Three coins are tossed once, find the probability of getting a head on first coin
is ___________.
29. A letter is chosen at random from the word ‘PROFESSOR’. The probability
that it is a vowel is ____ and the probability that it is a ‘S’ is _________________
30. Three salesmen A, B and C have been given a target of selling 10,000 units of
a particular product, the probabilities of their achieving their targets being
respectively 0.25, 0.30 and 0.50. If these three salesmen try to sell the product,
then the probability of success of only one salesman and failure of the other
two is___________
31. A problem in statistics is given to 5 students A, B , C , D, E. Their chances of
solving it are ½; 1/3; ¼; 1/5 and 1/6 respectively. Then the probability that the
problem will be solved is _______________
32. The probability that a man hits a target is 1/5. Then the probability that at
least one target is hit in 10 shots is ____________
33. A committee of 2 persons is to be selected from 5 females and 8 males. Then
the probability that at least one of the selected person will be a female is
________________
34. In solving a hurdle, odds against A are 4 to 3 and odds in favour of B in
solving the same is 7 to 5. Then the probability that problem will be solved
is_________________
35. Probability that a man will be alive 10 years hence is 7/15 and that a woman
will be alive is 7/10. The probability that both man and woman will be dead
10 years hence is _____________
36. A couple appear in an interview for two vacancies in the same post. The
probability of husband’s selection is 1/7 and that of wife’s selection is 1/5.
The probability that only one of them is selected is ____
37. A problem in statistics is given to A and B. The odds in favour of A solving the
problem are 6 to 9 and against B solving the problem are 12 to 10. If both A
and B attempt, the probability that the problem is solved is _____________
38. ______________ is an expression of likelihood or chance of occurrence of an
uncertain event.
39. Probability of sample space is _____________
40. Probability of null set is _____________

TRUE/FALSE
1.
Probability of an impossible event is 1.
2.
Probability of sample space is 1.
3.
Probability of an event is greater than one.
4.
Probability of null set is zero.
261 Answers to objective type questions

5.
P(A/B)P(B) = P(B)

P(A) = P( A )
6.

P( A ∩ B ) = 1‑ P(A ∪ B)
7.
8.
A single letter is selected at random from the word PROBABILITY. The
probability that it is a vowel is 4/11.
9.
In the simultaneous throw of two dice, the probability of getting a doublet is
5/6.
10. Addition theorem is P(A ∩ B) = P(A) + P(B) ‑ P(A ∪ B)
11. Probability is an expression of likelihood or chance of occurrence of an
uncertain event.
12. If A and B are mutually exclusive then P(A ∩ B) = P(A)P(B)
13. If A and B are independent then P(A ∩ B) = P(A)P(B)
14. Probability that a leap year selected at random contains 53 Sundays is 1/7
15. Two events are said to be mutually exclusive if in no case one is preferred to
the other.
16. When two coins are tossed simultaneously, then sample space is {HH, TT, TH}.
17. If A and B are mutually exclusive then P(A ∪ B) = P(A) + P(B)
18. The probability of drawing one white ball from a bag containing 6 red, 8
black,10 yellow and 1 green ball is 0.
19. A coin is tossed three times in succession. Then the number of sample points
in a sample space is 8.
20. The probability of drawing any one spade card from a well shuffled pack of
52 cards is ¼

ANSWERS TO OBJECTIVE TYPE QUESTIONS

A1. (c) 4/13
Let S be the event that the card drawn is a spade. Then P(S) = 13/52
Let A be the event that the card drawn is an king then P(A) = 4/52
A and S are not mutually exclusive, P(S∩A) = 1/52. We find P(S ∪ A)
Then by addition theorem, P(S ∩ A) = P(S) + P(A) ‑ P(S ∩ A)
13 4 1 16 4
⇒ P (S ∪ A ) = + − = =
52 52 52 52 13
A2. (b) 1/221
Probability of first card to be an ace is 4/52. Now the card is not replaced.
Therefore, second card will be drawn from the remaining 51 cards out of
which there are only three aces. Probability of second card is 3/51. Then P
4 3
(both aces) = 52 × 51
 theory of probability 262

A3. (b) 1/9

A total of 5 can occur in the cases: (1,4), (4,1), (2,3), (3,2). Total number of cases
when two dice are thrown is 36. Therefore, required probability = 4/36 or 1/9
A4. (a) 1/6
A total of 7 can occur in the cases: (2,5), (5,2), (4,3), (3,4), (1,6), (6,1). Total number
of cases when two dice are thrown is 36. Therefore, required probability =
6/36 or 1/6
A5. (a) 1/12
A total of 10 can occur in the cases: (4,6), (6,4), (5,5). Total number of cases
when two dice are thrown is 36. Therefore, required probability = 3/36 or
1/12
A6. (a) 13/30
4 3 2 1 1 1
P(A) = ,P(B) = ,P(c) = ,P(A) = ,P(B) = ,P(c) =
5 4 3 5 4 3

Probability that exactly two of them hit =

4 3 1 4 1 2 1 3 2 13
P(AB c ) + P(A B C) + P( A BC) = × × + × × + × × =
5 4 3 5 4 3 5 4 3 30
A7. (a) 59/60
Probability that at least one of them hit = 1‑P(none can hit) = 1 ‑ P( ABc )
1 1 1 59
= 1 − × × =
5 4 3 60
A8. (b) 9/60
Probability that exactly one of them hit =
4 1 1 1 1 2 1 3 1 9
P(A B c ) + P( A B C) + P( A B c ) = × × + × × + × × =
5 4 3 5 4 3 5 4 3 60
A9. (c) 2/3
P(problem is solved) = 1 – P(at least one of A and B solves the problem)=
1-P(none can solve)
1 2 2

1 − P(AB) = 1 − × =
2 3 3
A10. (c) 3/6
1 2 1 1 3
P(exactly one of them solve) = P(A B ) + P( A B) = × + × =
2 3 2 3 6
A11. (a) 1/6
1 1 1
P(both of them solve) = P(A)P(B) = × =
2 3 6
A12. (c) 2/6
Probability of getting 1 is 1/6. Probability of getting 5 is 1/6. By addition
theorem, probability of getting 1 or 5 is 1/6 +1/6 = 2/6
A13. (b) is false
By addition theorem, if A, B and C are mutually exclusive events, then
263 Answers to objective type questions

2 1 1 13
P(A ∪ B ∪ C) = P(A) + P(B) + P(C) = + + = > 1 which is not possible
3 4 6 12
as probability can not be greater than one.
A14. (c) 0.936
P(at least one) = 1 – P(none) = 1 ‑ 0.4 × 0.4 × 0.4 = 0.936
A15. (c) 3:2
2 3

P(A) = P(B) ⇒ P(B) = P(A)
3 2
A16. (a) 16/21
3 7

P(A) = ,P(B) =
7 12
P(problem is solved) = 1 – P(at least one of A and B solves the problem)=
1-P(none can solve)
4 5 16

1 − P(AB) = 1 − × =
7 12 21
A17. (c) 3/4
1 1 1

P(A) = ,P(B) = ,P(c) =
2 3 4
P(problem is solved) = 1 – P(at least one of A ,B and C solves the problem)=
1-P(none can solve)
1 2 3 3

1 − P(ABc) = 1 − × × =
2 3 4 4
A18. (c) 1/12
1 1 2
Probability of getting two heads = ¼. Probability that die shows 3 or 4 is
+ =
6 6 6
By multiplication theorem for independent events, probability that both the
2 1 1
coins show heads and the die shows 3 or 4 = × =
6 4 12
A19. (b) 24/150
7 7
P(Ram is alive) = ,P(Shyam is alive) =
15 10
 7  7  24
P(both dead) = 1 − 1 −  =
 15  10  150
A20. (b) 15/64
Probability of getting a head= ½ and the probability of getting a tail is ½
2 4
1 1 15
Required probability = 6 c2     =
2 2 64
A21. (b) 6/16
Total number of cases when four coins are tossed = 24 = 16. Favourable
6
number of cases = 4C2 = 6. Required probability =
16
 theory of probability 264

A22. (a) 8/663

4
c1 × 4 c1 8
Required probability = 52
=
c2 663
A23. (b) 1/2
By addition theorem,
P(A ∪ B) = P(A) + P(B) – P(A ∩ B)
1 1 1 2
⇒ = + − P(A ∩ B) ⇒ P(A ∩ B) =
4 4 2 4
A24. (c) 0.06
P(receiving bonus and skilled) = 0.30 × 0.20 = 0.06 by multiplication theorem
A25. (c) 1/6
Three balls can be drawn out of total 9 balls in 9C3 = 84 ways. Balls are of same
colour means either all the three balls are red or all three are green. Required
5
c3 + 4 c3 10 + 4 1
probability = 9
= =
c3 84 6
A26. (a) 3/7
Four balls can be drawn out of total 8 balls in 8C4 = 70 ways. Equal number
of white and green balls are drawn means two white and two green balls are
5
c2 × 3 c2 10 × 3 3
drawn. Required probability = 8
= =
c4 70 7
A27. (a) 1/3
Six ladies can sit in 6! Ways. Consider the two particular ladies as one unit.
Then the number of ways in which five ladies can sit is 5!. Two ladies can sit
in 2! Ways. Therefore, favourable number of cases is 2! × 5!.
2! × 5! 1
Required probability = =
6! 3
A28. (a) independent
By addition theorem,
P(A ∪ B) = P(A) + P(B) – P(A ∩ B)
5 1 1 2

∞⇒ = P(A) + - ⇒ P(A) =
6 2 3 3
1 1 2

∴ P(A ∩ B) = = × = P(A)P(B)
3 2 3
Therefore, A and B are independent.
A29. (a) 1/3
Seven ladies can sit around a round table in 6! Ways. Consider the two particular
ladies as one unit. Then the number of ways in which six ladies can sit is 5!.
Two ladies can sit in 2! Ways. Therefore, favourable number of cases is 2! ×
5!.
2! × 5! 1
Required probability = =
6! 3
265 Answers to objective type questions

A30. (a) 1/36

P(A)=P(yellow)=3/6; P(B)=P(red in second draw) = 2/6; P(C) = P(blue in third
draw) = 1/6
3 2 1 1
Required probability = P(A ∩ B ∩ C) = × × = by multiplication theorem
6 6 6 36
6! × 7 P6
A31. (b)
12!
12 people can sir in 12! Ways. Therefore, total number of cases = 12!. Six boys
can sit in 6! Ways. Now there are seven gaps in which six girls can sit in 7P6
6! × 7 P6
= 5040 ways. Therefore, required probability =
12!
A32. (c) 49/120
Probability of selecting an urn = ½. Probability of drawing a white ball from
urn I is 5/12 and from urn II is 4/10. Therefore, required probability
1 5 1 4 49
= × + × =
2 12 2 10 120

A33. (a) 1‑P(A ∪ B)

Required probability= P( A ∩ B ) = 1‑P(A ∪ B)
A34. (a) 4/9
2 socks can be drawn out of 9 socks in 9C2 ways. Therefore, total number of
cases is 9C2. Two socks will match if they are of same color. Therefore, required
5
c + 4 c2 4
probability 29 =
c2 9
A35. (b) 1/36
Exhaustive number of cases when three dice are thrown = 6 × 6 × 6 = 216.
Same number can appear when we get (1,1,1), (2,2,2), (3,3,3) (4,4,4) (5,5,5) (6,6,6).
i.e., six cases are favourable. Required probability = 6/216 = 1/36
A36. (d) 1.2
By addition theorem,
P(A ∪ B) = P(A) + P(B) – P(A ∩ B)
 0.6 = P(A) + P(B) ‑ 0.2  P(A) + P(B) = 0.8

 1 – P( A ) + 1 – P( B ) = 0.8  P( A ) + P( B ) = 1.2

A37. (b) 52/77
2 6 3 5 52
P(A) =
, P(B) = .Then P(atleast one)=1 - P(none) = 1 - × =
7 11 7 11 77
A38. (b) 0.784
P(atleast one) = 1 – P(none) = 1-0.6 × 0.6 × 0.6 = 0.784
A39. (a) 1/13
By Bayes theorem, required probability
 theory of probability 266

(1/ 6) × 0.1
= = 1/13
(1/ 6) × 0.1 + (1/ 3) × 0.3 + (1/ 2) × 0.2
A40. (c) 16/20
P(non defective) = P(urn I and non-defective) + P(urn II and non- defective)
1 7 1 9 16
× + × =
2 10 2 10 20

A41. (a) 4/20

P(defective) = P(urn I and defective) + P(urn II and defective)
1 3 1 1 4
× + × =
2 10 2 10 20
A42. (c) 3/4
3 / 20
P(urn I / defective) = P(Urn I ∩defective)/P(defective)=
4 / 20
A43. (a) 6/35
2 / 6 × 3 /10 6

P (B2 / B ) = =
3 / 6 × 8 /10 + 2 / 6 × 3 /10 + 1/ 6 × 5 /10 35
A44. (b) 0.647, 0.353
0.55 × 0.03
(i) P(clerk1/ Error) = = 0.647
0.55 × 0.03 + 0.45 × 0.02
0.02 × 0.45
(ii) P(clerk2/ Error) = = 0.353
0.55 × 0.03 + 0.45 × 0.02
A45. (a) 0.36, 0.41, 0.23
P(M1) = 0.25, P(M2)= 0.35, P(M3) = 0.4
P(m1 ∩ d) 0.25 × 0.05
P(m1/ d) =
= = 0.36
P(d) 0.25 × 0.05 + 0.35 × 0.04 + 0.4 × 0.02

P(m2 ∩ d) 0.35 × 0.04

P(m2 / d) =
= = 0.41
P(d) 0.25 × 0.05 + 0.35 × 0.04 + 0.4 × 0.02

P(m3 ∩ d) 0.4 × 0.02

P(m3/ d) =
= = 0.23
P(d) 0.25 × 0.05 + 0.35 × 0.04 + 0.4 × 0.02
A46. (a) 5/13
Let H denote the event of taking more time. Let E1, E2 and E3 denote the
events of carrying out the task by A,B and C respectively. P(E1) = 0.45, P(E2)=
0.35, P(E3) = 0.20
P(e1 ∩ H) 0.45 × 1/16 5
P(e1/ H) =
= =
P(H) 0.45 × 1/16 + 0.35 × 1/10 + 0.20 × 1/ 20 13
A47. (a) 0.4949
267 Answers to fill in the blanks

0.2 × 0.98
P(A1/ B) =
= 0.4949
0.2 × 0.98 + 0.8 × 0.25
A48. (d) 2/3
P( A ∩ B ) = 1 – P(A ∪ B) = 1 ‑ P(A) – P(B) + P(A ∩ B)
1
p 1 2
= 1− − p + ⇒ p=
2 2 2 3
A49. (d) 2/3
P( A ∩ B ) = 1 – P(A ∪ B) = 1 ‑ P(A) – P(B) + P(A ∩ B)
1 1 7
= 1− p − p + ⇒ p=
3 2 12
A50. (b) 2/7

P(A) = 1 – P( A ) = 1‑0.7 = 0.3, P(B) = 1 ‑ k

P(A ∪ B) = P(A) + P(B) – P(A) P(B)
 A and B are independent

⇒ 0.8 = 0.3 + 1 – k – 0.3(1 ‑ k)

⇒ k = 2/7

ANSWERS TO FILL IN THE BLANKS

1.
4/52
26 4 2 28
2.
P(either red or king ) = + − = by addition theorem.
52 52 52 52
3. 2/52 since there are only two cards that are both red and king.
4. P(red or black ) = 3/10 + 2/10 = 5/10 , P(white or black) = 5/10 + 2/10 =
7/10
5. P(Grade A or B) = 20/100 + 25/100 = 45/100 , P(grade C or Grade D) = 20/100
+ 35/100 = 55/100
6. P(A or B) = P(A) + P(B) – P(A and B) = ¼ + ½ - 1/8 = 5/8
7. P(diamond or jack) = 13/52 + 4/52 – 1/52 = 16/52
8. P(queen of spade or king of heart) = 1/52 +1/52 = 1/26
5
C 2 + 4C 2 4
9. P(same color) = 9
=
9
C2
26
C 2 + 4C 2 − 2C 2 55
10. 52
=
C2 121
2 4 4 14
11. P(A ∩ B) = P(A) + P(B) – P(A ∪ B) = + − =
3 9 5 45
12. P(A and B) = 0.4 × 0.9 = 0.36
13. P(female engineer) = 68/140 , P(under 35/ female ) = 28/68 then P(female
and engineer) = 68/140 × 28/68 = 1/5
 theory of probability 268

14. 1/5
15. 5/10
16. 26/52
17. P(HH) = ¼
18. P(HT , TH) = 2/4
19. P(HH) = ¼
20. P(TH, HT) = 2/4
21. P(HH) = ¼
22. P(HHH) = 1/8
23. P(HHH, HHT, HTH, THH) = 4/8
24. P(HHT, HTH, THH, HTT, THT, TTH, TTT)= 7/8
25. P(TTT) = 1/8
26. P(HHT, HTH, THH) = 3/8
27. P(HTT, THT, TTH)= 3/8
28. P(HHH, HHT, HTH, HTT)=4/8
29. 3/9, 2/9
30. 0.4625 P(A B C ) = 0.25(1 – 0.30)(1 – 0.50) = 0.0875, P( A B C ) = 0.30(1 – 0.25)
(1‑ 0.50) = 0.1125
P(C A B ) = 0.50(1 – 0.25)(1‑ 0.30) = 0.2625. Required probability = 0.0875 +
0.1125+ 0.2625= 0.4625
31. 5/6. P(problem is solved) = P(at least one solves the problem) = 1- P( none
can solve) =
1 2 3 4 5 5

1−  × × × ×  =
2 3 4 5 6 6 10
4
32. P(atleast one) = 1-P(none) = 1-  
5
 
5
C1 × 8C1 5C 2 25
33. 13 + 13 =
39
C2 C2
 4 5  16
34. P(solve) = P(atleast one) = 1 – P(none) = 1-  ×  =
 7 12  21
35. P(man is dead)×P(woman is dead) = 8/15×3/10 = 24/150
1 4 1 6 2
36. P(only one) = P(A)P( B ) + P( A )P(B) = × + × =
7 5 5 7 7
9 12 37
37. P(solve) = P(atleast one) = 1 – P(none) = 1 − × =
15 22 55
38. Probability
39. one
40. zero
269 Answers to true/false

ANSWERS TO TRUE/FALSE
1. False. Probability of an impossible event is 0.
2. True
3. False. 0 ≤ P(A) ≤ 1
4. True
5. False. P(A/B)P(B)=P(A)

6. False P( A ) = 1 – P(A)
7. True
8. True as the word PROBABILITY contains 4 vowels.
9. False. A doublet can occur in 6 ways as (1,1) (2,2) (3,3) (4,4) (5,5), (6,6). So
required probability is 6/36
10. True. As it is same as P(A ∪ B) = P(A) + P(B) – P(A ∩ B)
11. True
12. False. If A and B are mutually exclusive then P(A ∩ B) = 0
13. True
14. False. It is 2/7 Refer to example 12 for explanation
15. False. These events are called equally likely.
16. False. When two coins are tossed simultaneously, then sample space is {HH,
HT, TT, TH}.
17. True. It is addition theorem for mutually exclusive events.
18. True. As there is no white ball, so probability is zero
19. True.
20. True. There are 13 spade cards in a pack of 52 cards.
 C H A P T E R

10 Permutation And
Combinations

Learning Objectives
By the end of this chapter, you will be able to understand:
u Concept of factorial
u Fundamental principle of addition and multiplication
u Permutation and combination

10.1 Introduction
In this chapter, we will discuss the factorial notation and fundamental princi-
ples of counting which enable us to understand the concepts of permutation
and combination.

10.2 Factorial
The continued product of first n natural numbers is called the “n factorial”
and is denoted by n!
i.e., n! = n(n - 1)(n - 2)(n - 3) ............3.2.1
For example, 4! = 4 × 3 × 2 × 1 = 24
Remark 1: Zero factorial = 0! = 1
2. Factorial of proper fractions or negative integers are not defined. Factorial is defined
only for whole numbers.

Example 1: Deduce n! = n(n - 1)!

Proof: n! = n(n - 1)(n - 2)............3.2.1
= n[(n - 1)(n - 2)............3.2.1]
= n[(n - 1)!]
270
271 Functional principle of addition Para 10.4

Example2 : Find the LCM of 4!, 5! and 6!

Solution: 5! = 5 × 4! and 6! = 6 × 5 × 4!
∴ LCM of 4!, 5! and 6! = LCM [4!, 5 × 4!, 6 × 5 ×4!]
= 4! × 5 × 6 = 6! = 720

10.3 Fundamental Principle of Multiplication:

If there are two jobs such that one of them can be completed in m ways and
when it has been completed in any one of these m ways, second job can be
completed in n ways then the two jobs in succession can be completed in m ×
n ways. This principle can be extended to any finite number of jobs.

Example3: In a class of 20 boys and 10 girls, the teacher has to select a boy and a
girl to form a committee. In how many ways can the teacher make this selection?
Solution: Number of ways in which a boy can be selected out of 20 boys is
20. Similarly the number of ways to select a girl = 10. Then by fundamental
principle of multiplication, the required number of ways = 20 × 10 = 200.

Example4: Eight athletes are participating in a race. In how many ways can the
first three prizes be won.
Solution: First prize can be won by any of the eight athletes in 8 ways. Then the
second and third prize can be won by the remaining two athletes in 7 and 6 ways
respectively. Then by fundamental principle of multiplication, total number of
ways in which eight athletes can participate in a race = 8 × 7× 6 = 336

10.4 Fundamental Principle of Addition:

If there are two jobs such that they can be performed independently in m
and n ways respectively, then either of the two jobs can be performed in (m
+ n) ways.

Example5: There are 3 students for scholarship A, 5 for scholarship B and 4 for
scholarship C.
(i) In how many ways can these scholarships be awarded?
(ii) In how many ways can any one of these scholarships be awarded?
Solution:
(i) Scholarship A can be awarded to any of the three candidates . Therefore,
number of ways in which scholarship A can be awarded is 3. Similarly,
scholarship B and C can be awarded in 5 and 4 ways respectively.
Therefore, required number of ways to award these scholarships = 3×
5× 4 = 60 by fundamental principle of multiplication.
Para 10.5 Premutations and combinations 272

(ii) Number of ways in which any one of these scholarships be awarded = 3

+ 5+ 4= 12 ways by fundamental principle of addition.

10.5 Permutations
Each of the arrangements which can be made by taking some or all of a number
of things is called a permutation. In permutation, the order of arrangement is
taken into account but when the order is changed, a different permutation is
obtained. If n and r are positive integers such that 1≤ r ≤ n, then the number
of all permutations of n distinct things, taken r at a time is denoted by n pr .
The value of n pr is given by:
n
pr = n(n - 1)(n - 2)(n - 3)..............(n - (r - 1))
n!
Moreover, n pr =
(n − r)!
Remark: The number of permutations of n distinct things taken all at a time
n! n!
is n pn = = = n!
(n − n)! 0 !

Example6: Write down all permutations of a set of three objects a, b, c taken (a)
two at a time (b) taken all at a time.
Solution:
(a) Different permutations of a set of three objects a, b, c taken two at a time
are {ab, bc, ac, ca, cb, ba}. These are six in number.
(b) Different permutations of a set of three objects a, b, c taken all three at
a time are {abc, bca, acb, cab, cba, bac}. These are six in number.

Example7: In how many different ways can three rings be worn in four fingers
with at most one in each finger?
Solution: Number of arrangements of 4 fingers taken 3 at a time =
4 4! 4!
p3 = = = 24
(4 - 3)! 1!

Example8: In how many ways can 5 persons stand in a queue?

Solution: This is same as the number of arrangements of 6 different things taken
all at a time = 5! = 120

Example9: How many numbers lying between 100 and 1000 can be formed with
the digits 1, 2, 3, 4, 5 if the repetition of digits is not allowed?
Solution: Every number lying between 100 and 1000 is a three digit number.
Then the number of permutations of five digits taken three at a time is
273 Permutations under different conditions Para 10.6

5 5! 5! 5 × 4 × 3 × 2!
p3 = = = = 5 × 4 × 3 = 60
(5 - 3)! 2! 2!

Example10: Ten different letters of an alphabet are given. Words with five letters
are formed from these given letters. Determine the number of words which
have at least one letter repeated.
Solution: Total number of 5 letter words which can be formed from 10 letters
is 10 × 10 ×10 × 10 × 10 = 100000
Number of 5 letter words which can be formed from 10 letters with no letter
repeated = 10 p5 = 10 ! = 30240
5!
Therefore, the number of five letter words which have at least one of their
letters repeated = 100000 – 30240 = 69760

10.6 Permutations Under Different Conditions

1. The number of all permutations of n different things taken r at a time
when a particular object is to be always included in each arrangement is
r.n −1 pr −1
( )
2. The number of all permutations of n different things taken r at a time when
a particular object is never taken in each arrangement is n −1 pr because
one particular thing out of n distinct things is never taken, so we have to
take the arrangement of n-1 things taken r at a time.
3. The number of permutations of n different objects taken r at a time in
which two specified objects always occur together is 2.(r − 1) n − 2 pr − 2
4. The number of mutually distinguishable permutations of n things taken
all at a time, of which p are alike of one kind, q are alike of second kind,
r are alike of third kind such that p +q + r = n is
n!

p ! q! r!

5. The number of permutations of n different things, taken r at a time when

each may be repeated any number of times in each arrangement is nr
6. The number of circular permutations of n distinct objects is (n - 1)!
7. r n −1pr −1 + n −1
pr = n pr
Example11: In how many ways can the letters of the word PENCIL be arranged
so that (i) N is always next to E? (ii) N and E are always together?
Para 10.6 Premutations and combinations 274

Solution:
(i) When N is always next to E then we may consider EN as one unit. Then
we have five letters {P, EN, C,I, L}which can be arranged in 5P5 = 5! = 120
ways.
(ii) Consider E and N as one unit, then five letters of the word PENCIL be
arranged in 5 p5 = 5! = 120 ways but E and N can arrange themselves in
2! = 2 ways. Hence the required number of ways = 120 × 2 = 240

Example12: In how many ways can the letters of the word DELHI be arranged
so that the vowels occupy only even places?

Solution: There are two vowels E and I in the word Delhi which can occupy only
2nd and 4th place. These two vowels can be arranged in the two even places in 2!
= 2 ways. Then the remaining three letters {D,L,H} can be arranged in 3 places
in 3! = 6 ways. Hence the required number of ways = 6 × 2 = 12

Example13: How many different words can be formed with the letters of the
word MISSISSIPPI?
Solution: MISSISSIPPI is a eleven letter word in which there are 4 S , 4 I , 2P .
11!
Therefore, total number of words that can be formed is = 34650
4 ! 2! 4!
Example14:
(i) How many different words can be formed with the letters of the word
HARYANA?
(ii) How many of these begin with H and end with N?
(iii) In how many of these H and N are together?
Solution:
(i) HARYANA is a seven letter word in which there are 3A and the remaining all
7!
are each of its own kind. So the total number of words = = 840
3! 1! 1!1! 1!
(ii) When H is fixed is at first place and N is fixed at last place then we have
5!
five letters out of which three are alike. This can be done in = 20 ways.
3!
(iii) When H and N are always together, we consider them as one unit and
arrange 6 letters out of which three are alike i.e., A’s and others are each
of its own kind. These six letters can be arranged in 6! ways. But H and
3!
N can arrange themselves in 2! ways. Therefore, the required number of
6!
ways = × 2! = 240
3!
Example15: In how many ways 5 rings of different types can be worn in 4 fingers?
275 combinations Para 10.7

Solution: The first ring can be worn in any of the 4 fingers, so there are 4 ways
of wearing it. Similarly, each one of the other rings can be worn in 4 ways.
Therefore, the required number of ways = 45

Example16: In how many ways can 8 students be seated in a (i) line (ii) Circle?
Solution:
(i) The number of ways in which 8 students can be seated in a line = 8! =
40320
(ii) The number of ways in which 8 students can be seated in a circle is (8
–1)!= 7! = 5040

10.7 Combinations
Each of the different selections made by taking some or all or a number of
objects, irrespective of their arrangements is called a combination. The number
of all combinations of n things taken r at a time is generally denoted by n C r
and is given by n cr = n!
r ! (n - r)!
Properties of n cr
1. n cr = n cn − r for 0 ≤ r ≤ n. The utility of this theorem is felt when
r is very large. For instance, to calculate 30 c29 , we can calculate
30
c29 = 30 c30 − 29 = 30 c1 = 30 .
2. Let n and r be non- negative integers such that r ≤ n. Then, n cr + n cr −1 = n +1 cr
3. n cx + n c y ⇒ x = y or x + y = n
4. n pr = n cr × r!
5. The number of ways of selecting one or more items from a group of n
distinct items is n c1 + n c2 + n c3 + ....... n cn .
Also, n c1 + n c2 + n c3 + ....... n cn = ( n c0 + n c1 + n c2 + ....... n cn ) - n c0 = 2n - 1
6. The total number of ways of selecting some or all out of p + q + r items
where p are alike of one kind, q are alike of second kind, and rest are
alike of third kind is (p + 1)(q + 1)(r + 1) - 1. This is because, we may
select 0, 1, 2,….p items from p identical items in (p+1) ways. Similarly, q
and r identical items may be dealt within (q+1) and (r+1) ways. Hence,
the total number of ways of disposing all the items is (p+1)(q+1)(r+1).
But the number includes one case in which none of the items is taken,
therefore the total number of ways is (p + 1)(q + 1)(r + 1) - 1
7. The total number of ways of selecting one or more items from p identical
items of one kind; q identical items of second kind; r identical items of
third kind and n different items is (p + 1)(q + 1)(r + 1) 2n - 1
Para 10.7 Premutations and combinations 276

Example17: List the different combinations formed of three letters a, b, c taken

two at a time.
Solution: The different combinations formed out of three letters a, b and c are
{ab, bc, ac}. These are three in number.

Example18: Ifc8 = n c5 , find the value of n.

n

Solution: We have n cx = n c y if x + y = n or x = y therefore n c8 = n c5  n =

8 + 5 = 13

Example19: If 10 10
cn = cn + 4 , find the value of n.
Solution: 10
cn = 10
cn + 4  n + n +4 = 10  n = 3
Example20: In how many ways can 4 students be selected out of 32 students of
a class for forming a committee?

Solution: 4 students be selected out of 32 students in

32 32! 32 × 31 × 30 × 29 × 28!
c4 = = = 35960
4 ! 28! 4 × 3 × 2 × 1 × 28!

Example21: In how many ways, a committee of 5 members can be selected from

6 men and 5 women, consisting of 3 men and 2 women?
Solution: Three men out of 6 men can be selected in 6C3ways. Two women out
of 5 women can be selected in 5C2 ways. Therefore, required number of ways
= 6C3 × 5C2 =200

Example22: From a class of 25 students, 10 are to be chosen for a trip. There are
3 students who decide that either all of them will join or none of them will join.
In how many ways can they be chosen?
Solution: When three particular students join the party then we have to choose
7 more students from the remaining 22 students which can be done in 22C7 =
170544 ways
When three particular students do not join the party then we have to choose
all 10 students from the remaining 22 students which can be done in 22C10 =
646646 ways
Therefore, by fundamental principal of addition, required number of ways =
170544+ 646646 = 817190

Example23: Out of 7 consonants and 4 vowels, how many words of 3 consonants

and 2 vowels can be found?

Solution: 3 consonants can be chosen out of 7 consonants in 7C3 35 ways and 2

vowels can be chosen out of 4 vowels in 4C2= 6 ways. Therefore, by fundamental
principal of counting, total number of ways of selecting these consonants and
277 Objective type questions

vowels is 35 × 6 = 210 But these five letters can arrange themselves in . 5! =

120 ways Therefore, required number of words = 210 × 120 = 25200

Example24: Ramesh has 5 friends. In how many ways can he invite one or more
of its friends to lunch?
Solution: Ramesh has to select one or more of its friends from a group of five
friends. This can be done in 25 - 1 = 31 ways.

Example25: Find the total number of proper factors of 38808.

Solution: Factorizing 38808, we get 38808 = 23.32.72.11. The total number of
divisors of this number is same as the number of ways of selecting some or
all of the two 2’s, two 3’s, two 7’s and one 11. This can be done in (3+1)(2+1)
(2+1)(1+1) –1 = 71. But this includes the division by the number itself, hence
the required number of divisors are 71 – 1 = 70

Example26: Find the total number of factors excluding 1 and the expression itself
of the product a7b4c3 def where a, b, c, d, e, f are all prime numbers.
Solution: This can be done in (7+1)(4+1)(3+1)(1+1)(1+1)(1+1) –1 = 1279. But
this includes the division by the number itself, hence the required number of
divisors are 1279 – 1 = 1278

OBJECTIVE TYPE QUESTIONS

Q 1. The number of ways in which n distinct balls can be put into two different
bags is:
(a) 2n (b) n2 (c) 2n (d) nP2
Q 2: The number of ways in which one can post 5 letters in 7 letter boxes is
(a) 35 (b) 75 (c) 57 (d) 7P5
Q 3: Out of 10 consonants and four vowels, the number of words that can be formed
using 6 consonants and 3 vowels is:
(a) 10
C6 × 6C3 (b) P6 × 6P3 (c)
10
P6 × 4P3 (d) 9! × 10C6 × 4C3
10

Q4: If 12Pr = 11P6 + 6. 11P5 then r is equal to:

(a) 6 (b) 5 (c) 7 (d) none of these
Q5. If Pr = 720 Cr , then the value of r is
n n

(a) 6 (b) 5 (c) 7 (d) 4

Q6. If 35Cn+7 = 35C4n–2 then the value(s) of n are:
(a) 28 (b) 3 (c) 6 (d) 6, 3
Q7. If 2n+1Pn–1 : 2n–1Pn = 3 : 5 then the value of n is:
(a) 6 (b) 3 (c) 8 (d) 4
 Premutations and combinations 278

Q8. Everybody in a room shakes hands with everybody else. The total number of
hand shakes is 66. The total number of people in the room are:
(a) 11 (b) 12 (c) 13 (d) 14
Q9. Number of ways in which 15 students of a class exchange greeting cards with
each other is:
(a) C2 (b)
15 15
C2 ×2 (c) P2 (d)
15 15
P2 ×2
Q10. If n+2C8 : n-2P4 = 57 : 16, then n is :
(a) 17 (b) 18 (c) 19 (d) 20
Q11. A polygon has 44 diagonals, the number of its sides is:
(a) 9 (b) 10 (c) 11 (d) 12
Q12. A polygon has 170 diagonals, the number of its sides is:
(a) 17 (b) 20 (c) 25 (d) 12
Q13. The number of ways of painting the faces of a cuboid with six different colours
is:
(a) 720 (b) 6 (c) 1 (d) none
Q14. Ten different letters of an alphabet are given. Words with five letters are formed
from these given letters. Then the number of words which have at least one
letter repeated is :
(a) 69760 (b) 99780 (c) 30240 (d) none
Q15. An urn contains two white balls, three black balls and four red balls. In how
many ways can three balls be drawn from the urn if at least one black ball is
to be included in the draw?
(a) 84 (b) 64 (c) 129 (d) none
Q16. The number of permutations of the word BANANA is:
(a) 360 (b) 120 (c) 720 (d) 60
Q17. The number of permutations of the word MATHEMATICS is:
(a) 4989600 (b) 39916800 (c) 19958400 (d) none
Q18. The number of ways in which 8 different flowers can be strung to form a
garland so that 4 particular flowers are never separated is :
8!
(a) 4! 4! (b) 288 (c) (d) none
4!
Q19. If 7 points out of 12 are in the same straight line, then the number of triangles
formed is :
(a) 158 (b) 185 (c) 201 (d) 19
Q20. In an examination, there are three multiple choice questions and each question
has four choices. Number of ways in which a student can fail to get all answers
correct is :
279 Objective type questions

(a) 15 (b) 11 (c) 80 (d) 63

Q21. The total number of proper factors of 7875 are:
(a) 23 (b) 20 (c) 22 (d) none
Q22. The total number of proper factors of 75600 are:
(a) 120 (b) 119 (c) 118 (d) none
Q23. The number of ways in which 5 pictures can be hung from 7 pictures nails
on the wall is:
(a) 2520 (b) 78125 (c) 16807 (d) none
Q24. The number of straight lines can be formed out of 10 points of which 7 are
collinear is:
(a) 26 (b) 25 (c) 21 (d) none
Q25. The number of ways in which 52 cards can be divided be divided equally
amongst four players in order is :
52! 52!
(a) (b) (c) C13 (d) none
52

(13!) (13!)4 4 !
Q26. The number of ways in which 15 objects can be divided into groups of 8, 4
and 3 respectively is :
15! 15! 15!
(a) (b) (c) (d) none
8! 4 ! 3! 8! 4 ! 8! 4 ! 4!

Q27. There are 3 copies each of 4 different books. The number of ways in which
they can be arranged in a shelf is :
12! 12! 12!
(a) (b) (c) (d) none
3! 3! 3! 3! 4 ! 4 ! 4! ( )4 4 !
3!
Q28. The total number of ways in which 12 persons can be divided into three groups
of 4 persons each is:
12! 12! 12!
(a) (b) (c) (d) none
3! 3!3! 4 ! 4! 4!4! (4 !)3 3!
Q29. The total number of ways in which 2n persons can be divided into n couples
is:
2n ! 2n ! 2n !
(a) (b) (c) (d) none
n! n! (2!)n n ! (2!)n

Q30. The total number of permutations of all the letters of the word EXERCISES
is :
(a) 10080 (b) 30240 (c) 60480 (d) none
Q31. The number of ways in which a hall can be illuminated by 10 lamps when
each one of them can be switched on independently is :
 Premutations and combinations 280

(a) 100 (b) 1023 (c) 1024 (d) none

Q32. The total number of selections of fruit which can be made from 3 apples, 4
bananas and 2 papayas is :
(a) 315 (b) 512 (c) 59 (d) none
Q33. The total number of arrangements of the letters in the expression a3b2c4 when
written at full length is :
(a) 610 (b) 1260 (c) 2520 (d) none
Q34. A book shelf contains a copies of one book, b copies of each of the two books,
c copies of each of the three books, single copy of d books. The total number
of ways in which these books can be distributed is:

(a + b + c + d) ! (a + 2b + 3c + d) !
(a) (b) 2 3
a ! b! c! a ! ( b!) (c!)

(c)
(a + 2b + 3c + d) ! (d) none
a ! b! c!
Q35. 6 women and 6 men are to sit around a circular table such that there is a man
on either side of every women, the number of seating arrangements is :
(a) 6!×5! (b) 6!×6! (c) 6! (d) none
Q36. The total number of ways in which a team of eleven players can be selected
from 22 players including 2 of them and excluding 4 of them is :
(a) 16C11 (b) 16
C9 (c) C6 (d) none
22

Q37. In world cup cricket, 153 matches were played. Every team played one match
with each other. The number of teams participating in the cricket is :
(a) 17 (b) 9 (c) 18 (d) none
Q38. Number of ways in which 5 red and 4 white balls may be drawn from a bag
containing 10 red and 8 white balls is :
(a) C9 (b) 8C5 × 10C4 (c)
18 8
C4 × 10C5 (d) none
Q39. Number of diagonals that can be drawn by joining the vertices of an octagon
are :
(a) 28 (b) 20 (c) 48 (d) none
Q40. There are 10 points in a plane, out of these 6 are collinear. The number of
triangles formed by joining these points is:
(a) 100 (b) 120 (c) 150 (d) none
Q41. The number of permutations of the word ACCOUNTANT is:
(a) 226800 (b) 113400 (c) 10! (d) none
Q42. The number of permutations of the word ENGINEERING is:
(a) 277200 (b) 46200 (c) 11! (d) none
281 Objective type questions

Q43. In how many ways can 4 Indians and 4 Pakistanis be seated around a circular
table so that no two Indians may sit together?
(a) 4! × 3! (b) 4! × 4! (c) 4! (d) none
Q44. Number of four letter words that can be formed out of the word LOGARITHMS
is:
(a) 10P4 (b) 10
C4 (c) 4! (d) none
Q45. In how many ways can 5 English, 3 Mathematics, 3 Hindi books be arranged
if the books of each different subject are kept together?
(a) 5!×3!×3! (b) 5!×3!×3!×3! (c) 11! (d) none
Q46. The number of permutations of the word ASSASSINATION is:
(a) 10810800 (b) 13! (c) 2702700 (d) none
Q47. In how many ways can the letters of the word ARRANGE be arranged such
that the two R come together
(a) 1260 (b) 360 (c) 900 (d) none
Q48. In how many ways can the letters of the word ARRANGE be arranged such
that the two R do not come together
(a) 1260 (b) 360 (c) 900 (d) none
Q49. In how many ways can the letters of the word ARRANGE be arranged such
that the two R and two A always come together
(a) 1260 (b) 360 (c) 900 (d) 120
Q50. Which of the following is correct?
n n −1
(a) pr = n × pr −1 (b) n pr = n × n pr −1
n n −1
(c) n
pr = n ! × n −1
pr −1 (d) pr = n × pr

FILL IN THE BLANKS

1. 15
P3 =________
2. P6 = _________
6

3. nPr =________× n–1Pr–1

4. 6C6 =_____________
5. nCn=_____________
n!
6. =__________
(n − r ) !
n!
7. =__________
r ! (n − r ) !
8. n! = n ×_______
9. The number of circular permutations of n distinct objects is _____________
 Premutations and combinations 282

10. The number of ways in which 8 persons can sit around a circular table is _____
11. The number of mutually distinguishable permutations of n things, taken all
at a time, of which p are alike of one kind, q are alike of second such that p +
q = n, is _____________
12. 0!=___________
13. Each of the arrangements which can be made by taking some or all of a
number of things is called_______
14. Each of the different selections made by taking some or all of a number of
objects irrespective of their arrangements is called a ________________
15. The number of all combinations of n distinct objects taken r at a time is
________________
16. Number of ways in which a person can invite one or more of his 6 friends for
dinner is ________
17. If 18Cr = 18Cr+2then r = ______________
18. nCx = nCy  x = y or _________
19. nPr = nCr × __________
20. The number of ways of selecting one or more items from a group of n distinct
items is _______
21. Number of ways in which a cricket team of 2 wicket keepers, 4 bowlers, 5
batsmen can be formed from a group of players containing 4 wicket keepers,
8 bowlers, 11 batsmen is ________
22. There are 12 points in a plane out of which 5 are in a line. Then the maximum
number of triangles that can be formed with vertices at these points are
________________
23. There are 12 points in a plane out of which 5 are in a line. Then the maximum
number of straight lines that can be formed with vertices at these points are
________________
24. There are n points in a plane out of which p are collinear. Then the maximum
number of straight lines that can be formed with vertices at these points are
________________
25. There are n points in a plane out of which p are collinear. Then the maximum
number of triangles that can be formed with vertices at these points are
________________
26. In order to pass an examination, minimum marks have to be secured in
each of the 7 subjects. Then the number of ways in which student can fail is
_____________
27. A question paper contains 6 questions each having an alternative. Then the
number of ways in which an examinee answer one or more questions is
___________________
28. If 20Cr = 20Cr–10 , then 18Cr =________________
29. If 20Cr = 20Cr 10 then rC3 =________________
283 true/false

30. If 15C3r = 15Cr + 3 then r =________________

31. If 20Cr+1 = 20Cr–1 then r =________________
32. If nPr = 720, nCr =120 then r = _____________
33. Total number of words formed by 2 vowels and 3 consonants taken from 4
vowels and 5 consonants is equal to ______________
34. Three persons enter an airport. If there are 5 seats vacant then the number
of ways in which they can take these seats is _______________
35. The number of words that can be formed out of the letters of the word
COMMITTEE is ______
36. Number of ways in which 5 prizes can be distributed among 4 boys when
every boy can take one or more prizes is _______________
37. Number of committees of 5 that can be formed from 6 men and 4 women of
which exactly 3 are men and 2 are women are _____________________
38. The number of ways to arrange the letters of the word CHEESE is ______________
39. 6 teachers and 6 students have to sit round a circular table such that there is
a teacher between any two students. The number of ways in which they can
sit is ________________
40. The number of proper divisors of 115500 is ___________

TRUE/FALSE
1. There are 12 points in a plane of which 6 are collinear, then the number of
straight lines obtained by joining these points in pairs is 12 c - 6 c + 1
2 2
2. Three letters can be posted in five letter boxes in 35 ways
52!
3. A pack of 52 cards can be divided equally among four players in order in
ways. (13!)4
4. There are six vacant seats in a room. Then the number of ways in which 3
persons can sit is 120.
5.
Different four digit numbers greater than 7000 that can be formed from the
digits 3,4,7,8,9 are 120
6. Number of three digit numbers that can be formed with distinct digits with
each digit odd is 60
7. Number of different signals that can be transmitted by arranging 3 red, 2
yellow and 2 white flags on a pole are 7!
8. Number of 5 digit even numbers that can be formed using the digits 1,2,7,7,4
are 24

9. Number of ways in which the product x 2 y 2 z can be written without using

exponent is 30.
10. Number of arrangements that can be made out of the letters of the word
SUCCESS so that all S do not come together is 420
 Premutations and combinations 282

ANSWERS TO OBJECTIVE TYPE QUESTIONS

A1: (c) 2n
First ball can be put in any of the two bags in 2 ways, second ball can be put
in any of the two bags and so on. Therefore, required number of ways = 2 ×
2 × 2 ........................n terms = 2n
A2: (b) 75
First letter can be put in any of the 7 letter boxes in 7 ways, second letter can
be put in any of the 7 letter boxes and so on. Therefore, required number of
ways = 7 × 7 × 7 × 7 ×7= 75
A3: (d) 9! × 10C6 × 4C3
6 consonants and 3 vowels can be selected out of 10 consonants and 4 vowels
in 10C6 × 4C3 ways. Then these 9 letters can arrange themselves in 9! ways.
Therefore, required number of ways is 9! × 10C6 × 4C3
A4: (a) 6
We know that r n −1 p + n-1p = n p
r −1 r r
Comparing this with the given equation, we get r = 6
A5. (a) 6
We have n
pr = n cr × r!
Comparing this with the given equation we get r! = 720  r = 6
A6. (d) 6, 3
35 35
cn + 7 = c4n-2  n + 7 = 4n -2 or n + 7 + 4n - 2 = 35  n = 3 or 6
A7. (d) 4
2n +1
We have
pn −1 3
2n −1
= . Expanding this and solving we get
pn 5
5(2n + 1)(2n)(2n − 1)! 3.(2n − 1)!
=
(n + 2)(n + 1)(n − 1)! (n − 1)!

 3n2 - 11n - 4 = 0  n = 4
A8. (b) 2
n(n − 1)
Let the number of persons be n then n c2 = 66 ⇒ 66 ⇒ n = 12
2
A9: (b) 15C2 × 2
A10: (c)19

We have
n+2
c8 57 . Expanding this and solving we get (n + 2)!(n − 6)! = 57
n−2
= (n − 6)!(n − 2)!8! 16
p4 16
 (n2 + n - 2)(n2 + n) = 143640
 (n2 + n)2 – 2 (n2 + n) +1 = 143641

285 Answers to objective type questions

 (n2 + n - 1)2 = (379)2

 (n2 + n - 1) = 379  n2 + n -380 = 0

 (n + 20)(n - 19) = 0  n = 19

A11. (c) 11
Let there be n sides of the polygon. Then the number of vertices is also n. A
straight line is obtained by joining any two vertices at a time which can be
done in nC2ways. But these lines also include n sides of the polygon. Therefore,
the required number of diagonals = nC2 – n

n n(n − 1)
Then, c2 − n = 44 ⇒ − n = 44 . Solving we get n = 11
2
A12. (b) 20
Refer to Q11 for the explanation
A13. (c) 1
Since the number of faces is same as the number of colours, therefore, the
number of ways of painting them is 1
A14. (a)69760
The number of ways in which 5 letters can be chosen out of 10 different letters
when repetition is allowed is 105. The number of ways in which 5 letters can
be chosen out of 10 different letters when none of the letter is repeated is 10P5
= 30240. Therefore, number of words which have at least one letter repeated
is 105 - 30240 = 69760
A15. (b) 64
At least one black ball can be included in the following ways:
(i) One black and two non-black balls: 3C1 × 6C2
(ii) Two black and one non-black ball: 3C2 × 6C1
(iii) All three black balls: 3C3
Therefore, required number of ways = 3C1 × 6C2 + 3C2 × 6C1 + 3C3 = 64
A16. (d) 60
In the word BANANA, there are 3 A, 2N and 1 B. Therefore, required number
6!
of permutations is = 60
3! 2!
A17. (a) 4989600
In the word MATHEMATICS, there are 2M, 2A, 2T, 1 H, 1E, 1C, 1 S and 1 I.
11!
Therefore, required number of permutations is = 4989600
2! 2! 2!
A18. (a) 4! 4!
Let us consider that 4 particular flowers as one flower then we have to arrange
5 flowers in a garland which can be done in (5 - 1)! =4! ways. Moreover, those
four flowers can arrange themselves in 4! ways. Then, required number of
ways is 4! 4!
A19. (b)185
 Premutations and combinations 286

3 points can be selected out of 12 points in 12C3 ways. Collinear points cannot
form a triangle.3 points out of 7 collinear points can be selected in 7C3 ways.
Hence, the number of triangles formed is 12C3 - 7C3 = 220 - 35 = 185
A20. (d) 63
The number of ways in which a student can answer three questions is 4 × 4 ×
4 = 64. There is only one way of answering all answers correctly. Therefore,
number of ways in which a student can fail to get all answers correct is :64 - 1
= 63
A21 (c) 22
Factorizing 7875, we get 7875 = 32.53.71. The total number of divisors of this
number is same as the number of ways of selecting some or all of the two
3’s, three 5’s, one 7. This can be done in (2 + 1)(3 + 1)(1 + 1) -1 = 23. But this
includes the division by the number itself, hence the required number of
divisors are 23 – 1 = 22
A22 (c)118
Factorizing 75600, we get 75600 = 24.33.52.71. The total number of divisors
of this number is same as the number of ways of selecting some or all of the
four two’s, three 3’s, two 5’s, one 7. This can be done in (4 + 1)(3 + 1)(2 + 1)
(1 + 1) -1 = 119. But this includes the division by the number itself, hence the
required number of divisors are 119 – 1 = 118
A23 (a) 2520
It is same as the number of arrangements of 7 things taken 5 at a time is 7P5
= 2520
A24 (b) 25
A straight line is formed by joining any two points. This can be done out of 10
points in 10C2 ways. But since 7 points are collinear, we must subtract 7C2 lines
and add the one corresponding line formed by all collinear points. Thus the
required number of straight lines = 10C2 - 7C2 + 1 = 25 ways.
52!
A25 (a)
(13!)4
The players who are to receive the cards are different, the required number
52!
of ways is
(13!)4
15!
A26 (a) 8! 4! 3!
12!
A27. (a) 3! 3!3! 3!
12!
12 books can be divided into 4 sets of 3 books each in 3! 3!3! 3!4! × 4!
12!
A28. (c)
(4 !)3 3!
287 Answers to objective type questions

The number of persons in each group is same therefore, required number of

12!
ways is
(4 !)3 3!
2n !
A29. (c)
n ! (2!)n
The number of n couples is same as dividing 2n people into n groups of 2 each.
12!
This can be done in ways.
(4 !)3 3!
A30. (b)30240
The word EXERCISES is a 9 letter word out of which there are 3 E’s, 2 S’s
9!
and all others are different. This can be done in = 30240 ways
2! 3!
A31. (b) 1023
The hall can be illuminated when one or more lamps are illuminated. Therefore,
the required number of ways = 210 - 1 = 1023
A32. (c) 59
The total number of selections of fruit is (3 + 1)(4 + 1)(2 + 1) - 1 = 59
A33. (b) 1260
9!
Required number of arrangements is 3! 2! 4! = 1260

(a + 2b + 3c + d) !
A34. (b)
a ! (b!)2 (c!)3
Total number of books = a + 2b + 3c +d. Out of these books, a are of one
kind, b are alike of the other kind, c are alike of third kind and all other books
(a + 2b + 3c + d) !
are different. Therefore, required number of ways is:
a ! (b!)2 (c!)3
A35. (a) 6! × 5!
6 women can sit around a round table in 5! Ways. Now six places are created
which can be filled by men in 6! Ways. Hence required number of sitting
arrangements is 6! × 5!
A36. (b) 16C9
When two players are included and four are always excluded, then we have
to select 9 players out of remaining 16 players which can be done in 16C9 ways.
A37. (c) 18
n(n - 1)
We have nC2 = 153 ⇒ = 153  n2 - n - 306 = 0  n = 18
2
A38 (c) 8C4 × 10C5
5 red balls can be selected out of 10 red balls in 10C5ways. Similarly, 4 white
balls can be selected out of eight white balls in 8C4 ways. Therefore required
number of ways is 8C4 × 10C5
 Premutations and combinations 288

A39. (b) 20
A straight line is obtained by joining any two vertices. This can be done in 8C2
ways. But this also includes the sides of octagon. Therefore, required number
of ways is 8C2 - 8 = 28 - 8 = 20
A40. (a) 100
A triangle is obtained by joining three non-collinear points. 3 points can be
selected out of 10 points in 10C3 ways. But out of ten points, six points are
collinear which cannot give us a triangle. So the number of triangles lost are
6
C3 . Therefore, required number of triangles are 10C3 - 6C3 = 120 - 20 = 100
A41. (a) 226800
10 !
It is given by = 226800
2! 2! 2! 2!
A42. (a) 277200
11!
It is given by = 277200
3! 3! 2! 2!
A43. (a) 4! × 3!
4 Pakistanis can sit around a round table in 3! Ways. Now four places are
created which can be filled by Indians in 4! Ways. Hence required number of
sitting arrangements is 4! × 3!
A44. (a) 10P4
A45. (a) 5! × 3! × 3! × 3!
5 English books can be arranged in 5! ways, 3 Mathematics books can be
arranged in 3! ways, 3 Hindi books can be arranged in 3! Ways. These three
different types of books can arrange themselves in 3! Ways. Therefore, total
number of ways = 5! × 3! × 3! × 3!
A46. (a)10810800
13!
It is given by = 10810800
3! 4! 2! 2!
A47. (b) 360
Consider the two R as one letter then there are 6 letters of which two A’s are
similar. Therefore, required number of ways is : 6! = 360
2!
A48. (c) 900
The word ARRANGE consist of 7 letters of which two are A, two are R and
7!
the rest are different. Hence they can be arranged in = 1260 ways. Now,
2!2!
consider the two R as one letter then there are 6 letters of which two A’s are
6!
similar. Therefore, required number of ways is : = 360 . Thus the number of
2!
arrangements in which two R are not together is 1260 – 360 = 900
289 answers to fill in the blanks

A49. (d) 120

Consider the two R as one letter and two A as one letter then there are 5 letters
which are all different. Therefore, required number of ways is : 5! = 120
A50. (a) nPr = n × n–1Pr–1
(n − 1)! (n − 1)! n!
n × n −1pr-1 = n × n× = = n pr
[(n − 1) − (r − 1)! (n − r)! (n − r)!

ANSWERS TO FILL IN THE BLANKS

15!
1. = 2730
12!
2. 6! =720
3. n
4. 1
5. 1
6. nPr
7. nCr
8. (n-1)!
9. (n-1)!
10. (8-1)! = 7!
n!
11.
p!q!
12. 1
13. Permutation
14. Combination
15. nCr
16. 26 - 1
17. 18
Cr = 18Cr +2
 r + r + 2 = 18  r = 8
18. x + y = n
19. r!
20. 2n - 1
21. 4
c2 × 8c4 × 11
c5
22. 12 5
c3 − c3
23. 12
c 2 − 5c 2 + 1
24. n
c2 − p c2 + 1
25. c3 − p c3
n
 Premutations and combinations 290

26. Each subject can be dealt in two ways, the student can pass or fail in it. So
the 7 subjects can be dealt in 27 ways. But this includes the case in which the
student passes in all the seven subjects. Excluding this case, we get that the
number of ways in which the student can fail is 27 -1
27. Each question can be dealt in three ways : answered , alternative is answered,
not answered. Therefore, the student can attempt 6 questions in 36 ways.
But this includes the case in which the student do not answer any question.
Therefore, required number of cases = 36 - 1
28. 20
cr = 20
cr-10 ⇒ r + r − 10 = 20 ⇒ r = 15. ∴ 18cr = 18c15 = 816
29. 20
cr = 20
cr+4 ⇒ r + r + 4 = 20 ⇒ r = 8. ∴ r c3 = 8c3 = 56
30. 15
c3r = 15cr+3 ⇒ 3r + r + 3 = 15 ⇒ r = 3
31. 20
cr +1 = 20
cr-1 ⇒ r + 1 + r − 1 = 20 ⇒ r = 10
32. n
pr = r! n cr ⇒ 720 = r!(120) ⇒ r ! = 6 ⇒ r = 3
33. 4
c2 × 5c3 × 5!
34. 5 × 4 × 3 = 60
9!
35.
2! 2! 2!
36. 4 × 4 × 4 × 4 × 4 = 1024
6
37.
c3 × 4 c2 = 120

38. 6! = 120
3!
39. 5! × 6!
40. 115500 = 22.53.3.7.11. Therefore, the number of proper divisors are (2 + 1)(3
+ 1)(1 + 1)(1 + 1)(1 + 1) - 2 = 94

ANSWERS TO TRUE/FALSE
1. True
2. False . It can be done in 5 × 5 × 5 = 125 ways
52!
3. True. Divide 52 cards in to 4 groups of 13 cards each. It can be done in
ways. (13!)4
4. True. First person can sit on any of the six vacant seats. Then second and third
person can sit in 5 and 4 ways. Therefore, total number of ways is 6 × 5 × 4
= 120
5. False. Digit at first place can be any of 7, 8, 9 so this can be done in 3 ways.
Now the remaining three digits can be any of the four digits left which can be
done in 4 × 3 × 2 = 24 ways. Therefore, total number of ways = 3 × 24 = 72
ways
291 answers to true/false

6. True. Odd digits are 1, 3, 5, 7, 9. Three distinct digits can be selected in 5 × 4

× 3 = 60 ways.
7!
7. False. Number of different signals is = 210
3! 2! 2!
8. True. Unit digit can be 2 or 4. That is unit digit can be chosen in 2 ways. Other
4!
digits can be selected in ways. Total number of ways to form a 5 digit even
2!
4!
number is × 2 = 24
2!
5!
9. True. Number of ways = =30
2! 2!
7!
10. False. Total number of arrangements of the word SUCCESS is
3! 2! .
Now if all S are to occur together, we consider them as one unit. Then we are
5!
left with arranging 1U, 2C, 1E and 1 unit of S. This can be done in ways.
2!
7! 5!
Therefore, total number of ways when all S do not come together is -
= 360 3! 2! 2!
 C H A P T E R

11 Progressions and Series

Learning Objectives
By the end of this chapter, you will be able to understand:
u Meaning of a progression
u Types of Progressions : Arithmetic Progression (A.P), Geometric Progression
(G.P), Harmonic Progression(H.P)
u Arithmetic mean , Geometric mean and Harmonic mean of two numbers.

11.1 Introduction
In this chapter, we will first introduce the concept of sequence and series. Then
we will discuss progressions and its types. At last, we will discuss how to find
A.M , G.M and H.M of two numbers.

11.2Sequence and Series

A real sequence is a function whose domain is the set N of Natural numbers
and range is the set R of real numbers. Terms of the sequence are denoted by
a1,a2,..........an. If a1,a2,..........an. is a sequence then an expression of the form a1 +
a2 +.........+an+....... is called a series. A series is finite or infinite according as the
number of terms is finite or infinite.

11.3 Progressions
It is not necessary that the terms of a sequence always follow certain pattern or
they are described by some explicit formula for the nth term. Those sequences
whose terms follow certain patterns are called progressions.

292
293 arithmetic progression Para 11.4

11.4 Arithmetic Progression (A.P)

A sequence is called an arithmetic progression if the difference of a term and
the previous term is always same, i.e., a n-1 -a n =d,∀n ∈ N where d is a constant
and is called common difference. For example, 1, 4, 7, 10, ….is an A.P whose
first term is 1 and the common difference is d = 3.
General term of an A.P: Let a be the first term and d be the common difference
of that A.P. Then the nth term is an = a + (n-1) d
nth term of an A.P from the end: Let a be the first term and d be the common
difference of the A.P. having m terms Then the nth term from the end is (m - n
+ 1)th term from the beginning i.e., am-n+1 a = + (m-n+1-1)d=a+(m-n)d
Selection of terms in an A.P
Sometimes we require certain number of terms in A.P. The following ways of
selecting terms are generally very convenient. When three terms are in A.P.
then we choose these three terms as a-d, a, +d. When four terms are to be
chosen in an A.P, then we take it as a-3d, a-d, a + d, a+3d. Five terms in an A.P
are to be chosen as a-2d, a-d, a,a + d, a +2d.
Sum to n terms of an A.P: The sum of the first n terms of an A.P with first
n
term a and common difference d is sn = [2a+(n-1)d] . It can also be obtained
2
from the first term a and last term l of the A.P as sn = n [a+l]
2
Example 1: The nth term of a sequence is 3n-2. Is the sequence an A.P? If so, find
its 10th term.
Solution: We are given that an = 3n-2 Then an-1 = 3 (n-1)-2 = 3n-5
Then an-1-an = 3n -5-3n + 2 = -3, n∈N. Here the common difference d is -3
which is a constant, so it is an A.P. Consequently, for finding the 10th term, put
n = 10 in an = 3n-2. Then a10 = 3 (10)-2 = 28

Example 2: Show that the sequence defined by an = 2n2 + 1 is not an A.P

Solution : We are given that an = 2n2 + 1. Then an+1= 2(n + 1)2 + 1=2n2 +4n +3.
 an+1 - an = 2n2 + 4n + 3 - 2n2 - 1 = 4n + 2
Here the common difference d is 4n+2 which is not a constant, so it is not an A.P.

Example 3: Which term of the series 12+9+6+........ is equal to -30?

Solution: The given series is an A.P with first term a = 12 and common difference
d = 9 – 12 = -3.
Let the nth term of this A.P be -30.
Then an = a + (n - 1)d = 12 + (n - 1)(-3) = 15 - 3n = -30 ⇒ n = 15. Therefore,
15th term is -30.
Para 11.4 progressions and series 294

Example 4: Find the sum of the series: 72 +70 +68 +.......... + 40

Solution: The given series is an A.P with first term a = 72, d = 70 – 72 = -2. Let
this A.P has n terms then an = a + (n - 1)d = 72 + (n - 1)(-2) = 40 ⇒ n = 17.
n 17
Then sn = [a+l]= [72+40]=952
2 2
Example 5: Find the sum of the series: 1+3-5+7+9-11+13+15-17+...........3nterms
Solution: The given series 1+3-5+7+9-11+13+15-17+......3nterms
= (1+7+13+.......nterms)+(3+9+15+nterms) - (5+11+17+....nterms)
Each expression in the bracket is an A.P with nterms and d = 6
n n n
Therefore, required sum = 2+(n-1)6+ 6+(n-1)6- 10+(n-1)6
2 2 2
n
= 2+6n-6+6+6n-6-10-6n+6
2
n
= 6n-8=3n 2 -4n
2

Example 6: The first and the last terms of an A.P are respectively -4 and 146 and
the sum of an A.P is 7171. Find the number of terms of the A.P and also its
common difference.
Solution: We have a = -4, l = 146, Sn= 7171. Let n be the number of terms of
an A.P. Therefore,
n 17
sn = [a + l]  7171 = [ −4 + 146]  n=101
2 2
Also, 146 = (-4)+(101-1)d 100d=146+4=150  d = 1.5

Example7: If the sum of the first n terms of an A.P is Sn = 2n2 + 3n, show that
the series is an A.P.
Solution: We are given that Sn = 2n2 + 3n.
Put n = 1, we get S1 = 2(1)2 + 3(1)=5
Put n = 2, we get S2 = 2(2)2 + 3(2)=14
Put n = 3, we get S3 = 2(3)2 + 3(3)=27
Put n = 4, we get S4 = 2(4)2 + 3(4)=44
Now first term = S1=5. Second term = S2 - S1 = 14-5 = 9. Third term = S3 - S2
= 27-14 = 13
Fourth term = S4 - S3 = 44 - 27 = 17. Therefore, the series is 5,9,13,17,........ which
is an A.P with a = 5, d = 4.
Example: Find the sum of all natural numbers between 200 and 400 which are
divisible by 7.
295 arithmetic progression Para 11.4

Solution: The natural numbers between 200 and 400 which are divisible by 7
are 203, 210, 217, …….399. These numbers are in A.P with first term 203 and
d = 7, nth term = an = a + (n - 1)d = 399
We have 399 = 203 + (n - 1) × 7  n=29
n 29
Also, sn = [a+l]= [203+399]=8729
2 2
Example: Find the sum of the first 200 natural numbers excluding those divisible
by 5.
Solution: The required sum is (1 + 2 + 3 +.......200) - (5 + 10 + 15 + 20 + ................200)
200
The sum of the first bracket is S1 = (1 + 200) = 20100
2
Consider the second bracket , (5+10 +15 +20 +……….200). It is an A.P with a
= 5, d = 5, Last term = 200
We have a + (n - 1)d = 200  5 + (n - 1)(5)=200  n=40
n 40
Hence, sum of the 40 terms of this A.P = s2 = [a+l]= [5+200]=4100
2 2
Therefore, the required sum = 20100+ 4100 = 16000

Example: If a, b, c be the sum of p, q, r terms respectively of an A.P , show that

a(q-r) b(r-p) c(p-q)

+ + =0
p q r
Solution: Let A be the first term and D be the common difference of an A.P. Then
p a d
a= [2A+(p-1)d] ⇒ =A+(p-1)
2 p 2
q b d
b= [2A+(q-1)d] ⇒ =A+(q-1)
2 q 2
r c d
c= [2A+(r-1)d] ⇒ =A+(r-1)
2 2 2
Multiplying the above equations by q-r, r - p , p – q respectively and add, we get
a(q-r) b(r-p) c(p-q)
+ + = A(q - r + r - p + p - q)
p q r
d
+ [(p - 1)(q - r) + (q - 1)(r - p) + (r - 1)(p - q)] = 0
2
Arithmetic Mean
When three terms are in A.P, the middle one is called arithmetic mean of other
a+c
two terms. If a, b, c are in A.P, we have b - a = c - b ⇒ b=
2
Para 11.4 progressions and series 296

In general, when any number of quantities are in A.P, the quantities lying
between the first and the last are called the Arithmetic Means. Thus if the
terms a,A1,A2,A3.........,An, b are in A.P, the quantities A1,A2,A3..........,An are called
A.M’s between a and b.
Insertion of Arithmetic Means:
Let A1,A2,A3..........,An be the A.Ms between a and b. Then a,A1,A2,A3.........,An, b are
in A.P. These are (n+2) terms in number. Then
b-a
b = a + (n + 2 - 1)d ⇒ d=
n+1
b-a
Hence, A1 = a+d = a+
n+1
b-a
A 2 =a + 2d = a+2.
n+1
b-a
A 3 =a + 3d = a+3.
n+1
…..
….
….
b-a
A n =a + nd = a+n.
n+1

Example: Find 14 arithmetic means which can be inserted between 5 and 8 and
show that there sum is 14 times the A.M between 5 and 8.

Solution: Let A1,A2,A3......................,A14 be the 14 A.M between 5 and 8.

Then 5,A1,A2,A3.............,An,8 will be in A.P. with a = 5, 16th term = 8
Then 8 = 5 + (16 - 1)d ⇒ d=1/5
A1 = a + d = 5 + 1/5=26/5; A2 = a + 2d = 5 + 2(1/5) = 27/5
Hence, 14 A.Ms are 26/5, 27/5, 28/5, ………..
n 14  26 1
Sum = sn = 2a+(n-1)d = 2× +(14-1)×  =91
2 2  5 5

A.M between 5 and 8 = 5 + 8 = 13

2 2
13
14 times the A.M is 14 × = 91
2
Hence proved.

Example: Find four numbers in A.P whose sum is 20 and sum of whose squares
is 20.
297 arithmetic progression Para 11.4

Solution: Let the four terms be a - 3d,a - d, a + 3d

Then sum = a - 3d + a - d + a + d + a + 3d = 4a = 20  a= 5
Sum of squares = (a - 3d)2 + (a - d)2 + (a + d)2 + (a + 3d)2 = 120
(5 - 3d)2 + (5 - d)2 + (5 + d)2 + (5 + 3d)2 = 120
Expanding and solving, we get d2 = 1 d = + 1
Put a = 5 and d = 1 in the terms chosen we get 2, 4, 6 and 8 as four numbers.
Put a = 5 and d = -1 in the terms chosen we get 8, 6, 4 and 2
Example: Find three numbers in A.P whose sum is 9 and product is -165.
Solution: Let the three terms in A.P be a - d, a, a + d
Then sum = a - d + a + a +d = 9  a= 3
Product = (a - d)a(a + d) = - 165
(3-d) (3) (3+d) = - 165
 9 - d = -55  d2 = 64
2
 d=+8
Put a = 3 and d = 8 in the terms chosen we get -5, 3 and 11 as three numbers.
Put a = 3 and d = -8 in the terms chosen we get 11, 3 and -5
Example: Divide 12.5 into five parts in A.P such that the first and the last part
are in the ratio 2:3.
Solution: Let the five parts in A.P be a - 2d, a-d, a, a, + d, a + 2d
Then a - 2d + a - d + a + a + d + a + 2d = 12.5
 5a = 12.5  a = 2.5
Since the first and the last part are in the ratio 2:3, therefore,
a − 2d 2
=  3a - 6d = 2a + 4d  10d = a = 2.5  d = 1/4
a + 2d 3
Putting the values of a and d in a - 2d, a - d, a, a, + d, a + 2d, We get the num-
bers as 2,2 1 ,2 1 ,2 3 ,3
4 2 4
1 1 1
Example: If , , are in A.P, prove that a2, b2, c2 are also in A.P
b+c c+a a+b

1 1 1
Solution: Since , , are in A.P then on multiplying each of these
b+c c+a a+b
numbers by (b + c)(c + a)(a + b), we get (c + a)(a + b), (a + b)(b + c) (b +d)(c
+ a) which are also in A.P.
i.e., a2 + (bc + ca + ab), b2 + (bc + ca + ab), c2 + (bc + ca + ab) are also in A.P
Subtracting (bc + ca + ab) from each of these numbers, we get a2, b2, c2 which
will be in A.P
Para 11.4 progressions and series 298

1 1 1
Example: If a2, b2, c2 are in A.P, prove that , , are also in A.P
b+c c+a a+b
1 1 1
Solution: , , are in A.P,
b+c c+a a+b
1 1 1 1
If − = −
c+a b+c a+b c+a

b+c−c−a c+a−a−b
⇒ =
(c + a)(b + c) (c + a)(a + b)
 (b - a)(a + b) = (c - b)(c + b)
 b2 - a2 = c2 - b2
 a2, b2, c2 are also in A.P which is true.

Example: A man saved ` 16500 in 10 years. In each year, after the first , he saved
`100 more than he did in the preceding year. How much did he saved in the
first year?
Solution: Let the savings of first year be a. Then, n=10, d = 100, Sn = 16500
n
sn = 2a + (n − 1)d 
2
10
⇒ 16500 = 2a + (10 − 1)100 
2
 16500 = 5[2a + 900]
 a = 1200
Thus, he saved `1200 in the first year.

Example: A man agrees to repay a debt of `2500 in a number of instalments,

each instalment beginning with second exceeding the previous one by `2. If
the first instalment be of `1, find how many instalments will be necessary to
repay the loan completely?
Solution: Let the instalment be denoted by a. Then a=1, d = 2, Sn=2500
n
sn = 2a + (n − 1)d 
2
n
⇒ 2500 = 2(1) + (n − 1)2 
2
n
⇒ 2500 = 2 + 2n − 2
2
 n = 50
Thus, he has to pay 50 instalments.
299 arithmetic progression Para 11.4

Example: The rate of monthly salary of a person is increased annually in A.P. It

is known that he was drawing `400 a month during the 11th year of his service
and `760 during the 29th year. Find his starting salary and the rate of annual
increment. What should be his starting salary at the time of retirement just
on the completion of 36 years of service?

Solution: Let the starting salary be ` a and d be the annual increment.

Then a + (11 − 1)d = 400;a + (29 − 1)d = 760
Solving these two equations we get a = 200, d = 20. Therefore, starting sa-
lary is `200 and annual increment = `20. Salary at the time of retirement =
a + 35d = 200 + 35(20) = 900

Exercise 11.1
Q1. Find the nth term of the following and give their 10th term.
(a) -15/8, -7/8, 1/8, 9/8, …………………
(b) 3,8,13,18, ………..
Q2. Find the sum of the following:
(a) 8 +13 +18 +23 +……………..25 terms
(b) 21+ 15 +9 +3 +………………20 terms
(c) 7+14+21+………. 20 terms
(d) -4-1+2+5+………..21 terms
Q3. How many terms are there in each of the following series:
(a) -3+3 +9 +…………+117
(b) 10 + 9.5 +9 + …......+ 0.5
Q4. How many terms of the series 5 +7 +9 +……….. must be taken so that
the sum may be 480?
Q5. Which term of the series 12 +9 +6 + ……..is equal to -100?
Q6. If a, b, c are the pth, qth and rth terms of an A.P, show that a(q - r) +
b(r - p) + c(p - q) = 0
Q7. The pth term of an A.P is q and the qth term is p. Show that the rth term
is p+q-r and the (p+q)th term is zero.
1 1
Q8. Find the sum of the series 2 + 3 + 5 + 6 + ............25 terms
2 2
Q9. The sum of a series in A.P is 72, the first term is 17 and the common
difference is -2, find the number of terms and explain the double answer.
Q10. Find the 20th term in A.P 15, 13, 11, …….. . Calculate the number of terms
required to make the sum equal to zero.
Para 11.4 progressions and series 300

Q11. Show that the sum of all odd numbers between 2 and 1000 which are
divisible by 3 is 83667 and of those not divisible by 3 are 166332.
Q12. Let the sum of n terms of two A.P be in the ratio 7n - 5 : 5n + 17. Show
that the 6th terms of two series are equal.
Q13. Find three numbers in A.P where the sum of the numbers is 24 and sum
of their cubes is 1968.
a(b + c) b(c+ a) c(a + b)
Q14. If a, b, c are in A.P show that , , are also in A.P
bc ca ab
Q15. If a, b, c are in A.P show that a2 (b + c), b2 (a + c), c2 (a + b) are also in
A.P
b+c−a c+a−b a+b−c 1 1 1
Q16. If , , are in A.P, show that , , are also in A.P
a b c a b c
Q17. A piece of equipment cost a certain factory `600000. If it depreciates in
value, 15% in the first year, 13.5% in the next year, 12% in the third year
and so on, what will be its value at the end of 10 years, all percentages
applying to the original cost?
Q18. A man is employed to count `10710. He counts at the rate of ` 180 per
minute for half an hour. After this, he counts at the rate of `3 less every
minute than the preceding minute. Find the time taken by him to count
the entire amount.
Q19. A man arranges to pay off a debt of `9600 in 48 annual instalments
which forms an A.P. when 40 of these instalments are paid, he becomes
insolvent and his creditor finds that `2400 still remains unpaid. Find the
value of each of the first three instalments. You may ignore the rate of
interest.
Q20. A man buys NSC of values exceeding of the last year’s purchase by `100.
After 10 years, he finds that the total value of NSC purchased by him
is `5000. Find the value of these NSC purchased by him. (i) in the first
year (ii) in the eighth year.
Q21. Divide 20 into 4 parts which are in A.P and such that the product of the
first and fourth is to product of second and third in the ratio 2:3

Answer

8n − 23 57
A1. (a) , (b) 5n - 2, 48
8 8
A2. (a) 1700 (b) -720 (c) 1470 (d) 546
A3. (a) 21 (b) 20
A4. 20
301 geometric progression Para 11.5

A5. No term
A8. 500
A9. n = 6 or 12
A10. n=16
A13. 5, 8, 11
A17. `105000
A18. 89 minutes
A19. First three instalments are `82.50, `87.50 and `92.50
A20. `50, `750
A21. 8,6,4,2

11.5 Geometric Progression

A geometric progression (G.P) is a sequence whose terms increase or decrease
by a constant ratio. The constant ratio is called common ratio. That common
ratio can be found by dividing any term by its preceding term. For example,
1, 2, 4, 8, 16, 32, ……………. Is a G.P with first term a =1 and common ratio r
= 2.A G.P with first term a and common ratio r with n terms is given by a, ar,
ar2 ,.......arn-1
nth term of a G.P = an = arn-1
Sum of a series in G.P
The sum of n terms of a series in G.P with first term a and common ratio r is :
 a(1 − r n ) 
 ,r < 1
sn =  n 1 − r 

 a(r − 1) ,r > 1
 r − 1 
a
Sum to infinite terms of a G.P = s∞ = where r <1
1− r
Convenient representation of terms in G.P
a
Three numbers in G.P are ,a,ar
r
a a
Four numbers in G.P are 3 ,ar,ar 3
r r
a a
Five numbers in G.P are ,a,ar,ar 2
r2 r
Geometric Mean
When any number of quantities form a G.P, the quantities lying in between
the first and the last are called the geometric means or G.Ms between the first
Para 11.5 progressions and series 302

and the last. Thus if a, G1, G2, G3,.......,Gn, b are the G.Ms between a and b. Let
a and b be any two numbers. Let G be the geometric mean between a and b.
G b
Then a, G , b are in G.P. Therefore, = ⇒ G 2 = ab ⇒ G = ab
a G
Therefore, we can say that geometric mean of two numbers a and b is ab
Insertion of Geometric Means
Let a and b be two numbers. Let us introduce n G.Ms between and b. Then a,
G1, G2, G3,.......,Gn, b are in G.P. These are n+2 terms in number.
Thus, b = (n + 2)th term = ar(n+2)-1=arn+1
n +1
b b
⇒ r n +1 = ⇒r=  
a a
n +1 2/(n +1) n/(n +1)
 b 2  b n  b
⇒ G1 = ar = a   ; G 2 = ar = a   ;...........G n = ar = a  
 a  a  a

Example: If the third term of a G.P is the square of the first and the fifth term
is 64, find the series.
Solution: Let a be first term and r be the common ratio.
Then third term = ar 2 , fifth term = ar 4 = 64  ……….(1)
Third term of a G.P is the square of the first means ar = a  r = a
2 2 2

Use this relation in (1) we get, ar4 = ar2.r2 = a.a.a = 64  a=4

Then r = 2 or -2
Taking a =4 and r = 2 the series is 4 + 8 + 16 + 32 +……….
Taking a = 4 and r = -2, the series is 4 -8 +16 – 32+……..
Example: Find which term of the series 0.004 + 0.02 + 0.1 + ...........is 12.5
0.02 0.1
Solution: On dividing any term by its preceding term as = 5; = 5;..........
0.004 0.02
Therefore, the given series is a G.P with a = 0.004 and r = 5.
Let the nth term be 12.5 Then arn-1 = 12.5
Then (0.004)5n-1 = 12.5    5n-1 = 3125    5n-1 = 55   n = 6
Therefore, 6th term is 12.5

Example: The sum of three numbers in G.P is 35 and their product is 1000. Find
the numbers.
a
Solution: Let the three numbers in G.P be ,a,ar
r
a
Then sum = + a + ar = 35
r
303 geometric progression Para 11.5

a
Product = . a. ar = 1000 ⇒ a 3 = 103 ⇒ a =10
r
1 
Also sum = a  + 1 + r = 35
r 
⇒ 10(1+r+r2) = 35r
⇒ 2r2 - 5r + 2 = 0
⇒ r = 2 or 1/2
Putting a = 10 and r =1/2 , we get 20, 10, 5 as numbers. Similarly on putting
a = 10 and r = 2, we get the same numbers in reverse order.

Example: If a, b , c are in G.P prove that a(b2 + c2) = c(a2 + b2)

Solution: Since a, b, c are in G.P therefore, b = ar, c = ar2 where r is the common
ratio.
L.H.S = a(b2 + c2) = a(a2r2 + a2r4) = a3r2(1 + r2)
R.H.S = c(a2 + b2) = ar2(a2 + a2r2) = a3r2 (1+r2)
Hence proved.

Example: Three numbers whose sum is 15 are in A.P. If 1, 4 and 19 are added to
them respectively, the results are in G.P Find the numbers.
Solution : Let the three numbers in A.P be a - d, a, a + d
Their sum = a - d + a + a +d = 15  3a = 15  a = 5
According to the given condition, a - d + 1, a + 4, a +d +9 are in G.P
 (a + 4)2 = (a - d + 1)(a + d +9)
 (5 + 4)2 = (5 - d + 1)(5 + d + 9)
 81 = (6 - d)(24 + d)
 d2 + 18d - 63 = 0
 d = 3 or -21
Putting the values of a and d we get the numbers as 2, 5, 8 or 26, 5, -16

Example: If a, b, c are the pth ,qth, rth terms of a G.P prove that a q − r .br − p .c p − q = 1
Solution: Let A be the first term and r be the common ratio of the G.P
Then a = AR p −1 ; b = AR q −1 ;c = AR r −1
Then a q − r .br − p .c p − q = A q − r R(q − r )( p −1) .A r − p R(r − p)(q −1) .A p − q R(p − q)(r −1) = A q − r + r − p + p − q r 0 = 1
Hence proved.

Example: Find the sum of the series 1 + 3 + 9 + 27 + .............10 terms

Solution: It is a G.P with a = 1, r = 3 >1 , n = 10 Then
Para 11.5 progressions and series 304

a(r n − 1) 1(310 − 1)
sn = = = 29524
r −1 3 −1
1 1
Example: Find the sum of the series 4 + 2 + 1 + + . + ...........10 terms
2 4
Solution: It is a G.P with a = 4, r = ½ <1 , n = 10 Then
a(1 − r n ) 1(1 − (1/ 2)10 )
sn = = = 8approx
1− r 1 − (1/ 2)

Example: Find the sum of the series 11 + 103 + 1005 + ..........n terms

Sn = 11 + 103 + 1005 + ...........

Solution: Let
= (10 + 1) + (102 + 3) + (103 + 5) +...............................
= (10 + 102 + 103 + ...............10n) + (1 + 3 +5 + ..............+ (2n - 1)
Now the series in the first bracket is a G.P with a = 10, r = 10 Therefore,
n n
sum = 10(10 − 1) = 10(10 − 1)
10 − 1 9
The series in the second bracket is an A.P with a = 1 , d = 2. Therefore,
n
Sum = (2(1) + (n − 1)2) = n 2
2
10(10n − 1)
Therefore the sum of the given series is = + n2
9
Example: Sum up to n terms the series: 7 + 77 + 777 + 7777 + ...................
Solution: Sn = 7 + 77 + 777 + 7777 + ...................n terms
⇒ = 7(1 + 11 + 111 + 1111 + ...................n terms)

7
⇒ (9 + 99 + 999 + 9999 + ........ n terms)
9
7
⇒ ((10 − 1) + (100 − 1) + (1000 − 1) + ........ n terms)
9
7
⇒ ((10 + 100 + 1000 + ........ + n terms)-(1+1+1+1+.....n terms))
9
7
⇒ ((10 + 102 + 103 + ........ + 10n )-n)
9
7  10(10n − 1)  7
⇒ - n
9  10 − 1  9
7 7
⇒ .10(10n − 1)- n
81 9
305 geometric progression Para 11.5

Example: Sum up to n terms the series: 0.7 + 0.77 + 0.777 + 0.7777 +............
Solution: Sn = 0.7 + 0.77 + 0.777 + 0.7777 + ............n terms
⇒ 7(0.1 + 0.11 + 0.111 + 0.1111 + .........n terms)

7
⇒ (0.9 + 0.99 + 0.999 + 0.9999 + ........ n terms)
9
7
⇒ ((1 − 0.1) + (1 − 0.01) + (1 − 0.001) + ........ n terms)
9
7
⇒ ((1 + 1 + 1 + ........ + n terms)-(0.1+0.01+0.001+.....n terms))
9

7  1 1 1 
⇒ n −  + 2 + 3 + ......... n terms 
9
  10 10 10 

 1 
1− n
7 1
⇒ n − . 10


9 10 1
1− 
 10 

7 1 1 
⇒ n − 1 − n  
9
 9  10  

Example: Find the sum of the series 8 + 4 2 + 4 + ..............∞

1
Solution: It is an infinite G.P with a = 8, r = 4 2 / 8 =
2
a 8
∴ s∞ = = = 8(2 + 2)
1− r 1
1−
2
Example: Insert five G.M between 320 and 5
Solution: When n G.M s are inserted between two numbers a and b such that
n +1
a, G1, G2, G3, ..............., Gn, b are in G.P. Then r =  b 
 a 
n +1 2/(n +1) n/(n +1)
 b  b  b
⇒ G1 = ar = a   ; G 2 = ar 2 = a   ;...........G n = ar n = a  
 a  a  a
6 6
 5   1 1
Here a = 320, b = 5 and n = 5, so r =  =   = and the five G.M are
 320   64  2

1 1 1
G1 = ar = 320 × = 160,G 2 = ar 2 = 320 × = 80,G3 = ar 3 = 320 × = 40,G 4 = 20,G5 = 10
2 4 8
Para 11.5 progressions and series 306

Example: If a, b, x, y, z are positive numbers such that a, x, b are in A.P, a, y, b are

in G.P and (a + b)z = 2ab, prove that x, y, z are in G.P.
a+b
Solution: Since a, x, b are in A.P, x =
2
Numbers a,y,b are in G.P , y2 = ab

Also z = 2ab
a+b
Then y 2 = ab = 2ab . a + b = xz
a+b 2
x y
⇒ = ⇒ x,y,z are in G.p
y z

Example: A person deposits some amount of money in a bank on the first day of
each month for three consecutive months. These three successive amounts
in the deposit , the total values of which is `65, form a G.P. If the two extreme
amounts be multiplied each by 3 and the mean by 5, the products form an A.P.
Find the amount in the first and second deposit.
Solution: Let the three consecutive deposits be `a, ` ar, ` ar2
Then a + ar + ar2 = 65 (1)
Also, 3a, 5ar, 3ar2 are in A.P which gives 3a - 5ar = 5ar - 3ar2
 3ar2 - 10ar + 3a = 0
 3r2 - 10r + 3 = 0
 (r - 3)(3r - 1) = 0
1

⇒ r = 3,
3
Put r = 3 in (i) we get a + 3a + 9a = 65 ⇒ a = 5
Thus the amounts are `5, `15, `45
a a
When r = 1/3 then a + + = 65 ⇒ a = 45
3 9

Then the amounts are `45, `15, `5. Hence the amounts in the first and second
deposits are either `5, `15 or `45 , `15

Exercise 11.2
Q1. Find the 6th term of 5, 15, 45, .........
Q2. Find the 12th term of 2, −2 3,6,.......
Q3. Find the nth term of the series: 9, -6, 4,..............
307 geometric progression Para 11.5

Q4. Find the nth term of the series: 72, -18, 9/2, -9/8,...............................
Q5. Find a G.P whose 3rd and 6th terms are 1 and -1/8 respectively. Write
down the 10th term also.
Q6. The third term of a G.P is 2/3 and 6th term is 2/81, find the 8th term.
Q7. If a, b, c are in A.P and x, y, z are in G.P, prove that xbycza = xcyazb
Q8. Find the sum of the series: 243 + 324 + 432 + …………….+nterms
1 1 1 1 1 1
Q9. Find the sum of the series: + 2 + 3 + 4 + 5 + 6 + ................∞
2 3 2 3 2 3
Q10. The sum of an infinite series in G.P is 57 and the sum of their cubes is
9747, find the series.
Q11. In an infinite G.P , each term is equal to three times the sum of all the
terms that follow it and the sum of the first two terms is 15. Find the
sum of the series to infinity.
Q12. Find three numbers in G.P such that their sum is 21 and sum of their
squares is 189.
Q13. If a, b, c, d are in G.P prove that a + b, b + c, c + d are also in G.P
Q14. If a2 + b2, ab + bc, c2 + b2 are in G.P, prove that a, b, c are also in G.P
Q15. Sum to n terms the series: 5 +55 +555 +………
Q16. Sum to n terms the series: 0.5 +0.55 +0.555 +………
Q17. Find the infinite G.P whose first term is ¼ and the sum is 1/3
Q18. Find three numbers in G.P such that their sum is 130 and their product
is 27,000.
Q19. Find three numbers in G.P such that their sum is 13/3 and sum of their
squares is 91/9.
Q20. At 10% per annum compound interest, a sum of money accumulates to
`8750 in 4 years. Find the sum invested initially.

Answers
A1. 1215
A2. −486 3
n −1
A3. ( −2)
3n − 3
n−4
A4. (5)
2
A5. 4, -2, 1, ……, -1/128
Para 11.6 progressions and series 308

A6. 2/729
A8. 36 − n (4n − 3n )
A9. 19/24
A10. 19, 38/3, 76/9, …………..
A11. 16
A12. 3, 6, 12
50 5
A15. 10n − 1 − n
( )
81 9
5 50  1 
A16. n− 1− n 
9 81  10 


A17. 1 , 1 , 1 ,.............
4 16 64
A18. 10,30,90
A19. 1/3, 1, 3
A20. `5976.37

11.6 Harmonic Progression

A sequence a1, a2, a3, ...............an,............... of non-zero numbers is called a Harmonic
1 1 1 1
progression if the sequence , , ,............ ,.......... are in A.P
a1 a 2 a 3 an
1 1 1
For example, , , ,............ are in H.P as 2,4,6 are in A.P.
2 4 6
Insertion of n Harmonic means (H.M)
Let a and b be any two given numbers. Let H1, H2, H3,............Hn be n H. Ms in-
serted between a and b. Then a1, H1, H2, H3,............Hn, b are n+2 in number and
1 1 1 1 1
are in H.P. Then , , ,............ , are in A.P
a H1 H2 Hn b
1 1
Then = (n + 2) th term = + (n + 1)d where D is the common difference.
b a
a−b
d=
(n + 1)ab

Thus, if n H.M are inserted between two given numbers a and b, then the
a−b
common difference of the corresponding A.P is d =
(n + 1)ab
1 1 1 1 1 1
Also, = + d, = + 2d,......... = + nd
H1 a H2 a Hn a
309 Harmonic progression Para 11.6

Harmonic mean of two numbers :Let a and b be any two non-zero numbers,
2ab
then their harmonic mean is H =
a+b
Relation between A.M, G.M, H.M of two numbers a and b
Let a and b be any two numbers then
2ab a+b
G.M = G = ab,H.M = H = , A.M = A =
a+b 2

(a + b)H
G = ab ⇒ G 2 = ab = = AH
2
Therefore, G2 = AH

Example: Find the harmonic mean of 25 and 30.

2ab 2(25)(30) 1500
Solution: Let a = 25 , b = 30 then H.M = H = = = = 27.27
a+b 25 + 30 55

Example: If the first two terms of a HP are 2/5 and 12/13 respectively. Then
prove that second term is the largest term. Also find the largest term .
1 1 1 1
Solution: Let the HP be , , , ,.................
a a + d a + 2d a + 3d

Then 1 = 2 , 1 = 12 ⇒ a = 5 ,d = −17
a 5 a + d 13 2 12
1 12
Now, nth term of the HP is =
a + (n − 1)d 47 − 17n
So the nth term is largest when 37 – 7n has the least value. Clearly, this has the
least value if n = 2. Therefore, 2nd term is the largest. Then the largest term is
12 17
= =
47 − 17(2) 3

a b c
Example: If a, b,c are in H.P then show that , , are also in HP
b+c a+c b+a
Solution: If a, b, c are in HP then
1 1 1 are in A.P
, ,
a b c

a+b+c a+b+c a+b+c

⇒ , , are in A.P
a b c
b+c a+c a+b
⇒ 1+ ,1 + ,1 + are in A.P
a b c
b+c a+c a+b
⇒ , , are in A.P
a b c
Para 11.6 progressions and series 310

a b c
⇒ , , are in HP
b+c a+c b+a
a−b a
Example: If a, b, c are in HP then prove that =
b−c c
2ac
Solution: Since a, b, c are in HP therefore, b =
a+c
2ac
a− 2
a−b a + c = a − ac = a
⇒ =
b−c 2ac ac − c2 c
−c
a+c

Example: For two unequal numbers, AM = 4, G.M = 2. Then find the H.M
Solution: G2 = AH    4=4H    H=1
 C H A P T E R

12 Index Numbers

Learning Objectives
By the end of this chapter, you will be able to understand:
u Meaning of Index numbers
u Uses of index numbers.
u Price index number, quantity index number, value index
u Methods of constructing index numbers- Fisher’s , Laspeyere’s and Paasche’s
method

12.1 Introduction
Index numbers are widely used in almost every field to measure the effect of
change in prices, quantity consumption, index number of exports, imports,
industrial production or many other business activities.

12.2 Meaning of Index Numbers

An index number is a statistical measure designed to show changes in a vari-
able or a group of related variables with respect to time, geographic location
or other characteristics such as profession, income etc.---Spiegel

12.3 Uses of Index numbers

Important uses of index numbers are:
1. Comparison: Index numbers are used to compare the data over a period
of several years. For instance, prices of a commodity are compared
in a market or a country over time with a view to study the order
of change in the price position over a given period. Comparison can
311
Para 12.4 Index numbers 312

also be made at a given point of time at different markets in the same

country or in different countries to observe the relative levels of prices
of the commodities. Comparisons reflect the true state of supply and
demand of the commodity undetected by the impact of other factors
such as time factor changes, quality specifications, market trend. For
comparison purposes, the price data are maintained in the form of price
index numbers, price relatives etc.
2. Valuation : Valuation of agricultural output in a country is made when
constructing the economic accounts for agriculture and estimating the
share of agriculture in the national product. For this, index number of
agricultural output is created.
3. Framing suitable policies: Business organisations use price index
number to frame policies regarding inventory expansion, purchasing
production requisites, credit policies, deciding nature and volume of
storage accommodation needed for stocking goods. Government use
consumer price index number to decide the dearness allowance.
4. Trends and tendencies: Index numbers reveal trends and tendencies of
phenomenon under study. For example, by considering the index number
of imports of sugar, we can see that our imports are showing an upward
tendency. Similarly, by examining the index numbers of production and
sales of a business activity for the last of few years, we can determine
the trend of production and sales and can draw important conclusions
such as how much change is taking place due to the effect of seasonality,
cyclical forces etc.
5. Forecasting: By identifying the past and present behaviour of any
economic and business activity, we can predict for future also.
6. Inflation: Index numbers are used in inflation also. Many of the index
numbers are related to the measurement of price and wage movements
i.e., to inflation measurement. These index numbers include high profile
consumer price index. Inflation measures persistent price changes.
7. Deflation: Like inflation, index numbers are used in deflation also i.e,
they are used to adjust the original data for price changes or to adjust
wages and salaries for cost of living changes. They are used to convert
nominal wages to real wages.

12.4 Methods of constructing index numbers

1. Unweighted index numbers: While constructing unweighted index numbers
such as price index number, we consider only price data. No weight is used
to compare prices. Unweighted price index numbers are constructed by the
following two methods.
313 methods of constructing index nos. Para 12.4

(a) Simple aggregative method: It is the simplest method of constructing

index numbers. Price index by this method can be calculated by the
following formula:
∑ p1
P01 =
× 100
∑ p0
where P01= price index number
P1 = prices of commodities in current year
P0 = prices of commodities in base year
Advantages:
1. It is very simple and easy to calculate.
2. It does not require much effort and more time.
Disadvantages:
1. Values of index can be manipulated in terms of unit.
2. Equal importance is given to all the items which is practically not true.
3. It does not satisfy unit test.
(b) Simple average of price relatives method: In this method, average of
price relatives is taken. Arithmetic mean or geometric mean may be
used to take average of price relatives. Price index by this method can
be calculated by the following formula:
p 
∑  1 × 100
 p0 
P01 =
n
where P01 = price index number
P1 = prices of commodities in current year
P0 = prices of commodities in base year
n= number of items whose price relatives are to be averaged.
Advantages:
1. It is not influenced by extreme observations.
2. The index is not influenced by the units in which price or quantities
are quoted.
Disadvantages:
1. It is difficult to decide which average is to be used – Arithmetic mean
and geometric mean. Geometric mean is theoretically considered to be
the best average while constructing index numbers but it is difficult
to calculate. Arithmetic mean is preferred as it is easy to compute.
2. Equal importance is given to all items which is practically wrong.
Para 12.4 Index numbers 314

Example 1 : Construct an index for the year 2015 taking 2014 as base year form
the data given below:

Commodity Price in 2014(`) Price in 2015(`)

A 60 70
B 70 60
C 50 40
D 40 40
Solution:
Construction of price index
Commodity Prices (2014) P0 Prices (2015) P1

A 60 70
B 70 60
C 50 40
D 40 40

∑ p0 =220 ∑ p1 = 210

By simple aggregative method,

∑ p1 210
P01 = × 100 = × 100 = 95.45
∑ p0 220

It means that there is a net decrease of (100 – 95.45 = 4.5%) in prices in 2015
as compare to prices in 2014.

Example 2: Calculate quantity index by first taking 2009 as base year and then
2011 as base year.

Year Quantity of X (tonnes)

2009 40
2010 50
2011 60
2012 70
2013 80
2014 90
2015 95
315 methods of constructing index nos. Para 12.4

Solution:
Construction of Quantity Index
Year Quantity Index numbers Index numbers
(2009=100) (2011 = 100)

2009 40 100 40
× 100 = 66.66
60

50 50
2010 50 × 100 = 125 × 100 = 83.33
40 60
60
2011 60 × 100 = 150 100
40

70 70
2012 70 × 100 = 175 × 100 = 116.67
40 60

80 80
2013 80 × 100 = 200 × 100 = 133.33
40 60

90 90
2014 90 × 100 = 225 × 100 = 150
40 60

95 95
2015 95 × 100 = 237.5 × 100 = 158.33
40 60

Example 3: Compute the index number by taking 2000 to 2002 as base year for
the data given below.
Year Price of Tea (`)
2000 4
2001 5
2002 6
2003 7
2004 8
2005 9
2006 10
2007 11
Solution: Since 2000 to 2002 is taken as base year, it means we have to take
average of prices of tea in these years as comparable price.
4+ 5+ 6
Average = =5
3
Para 12.4 Index numbers 316

Year Price(`) Index numbers

2000 4
4
× 100 = 80
5
5
2001 5 × 100 = 100
5
6
2002 6 × 100 = 120
5

7
2003 7 × 100 = 120
5

8
2004 8 × 100 = 160
5

9
2005 9 × 100 = 180
5

2006 10 10
× 100 = 200
5
11
2007 11 × 100 = 200
5

Example 4: Construct price index number for the year 2015 taking 2014 as base
by simple average of price relatives method by using AM for taking average.

Items Price in 2014 (`) Price in 2015 (`)

P 30 40
Q 50 60
R 70 80
S 90 100
Solution:
Index number using 2014 as base
Items Price in 2014 (`) Price in 2015 (`) Price relative
P0 P1 p1
×100
p0

P 30 40 40
×100 =133.33
30
317 weighted aggresative index Para 12.5

Q 50 60 60
×100 =120
50
R 70 80 80
×100 =114.28
70
S 90 100 100
×100 =111.11
90
Total 478.72

p 
∑  1 × 100
 p0  478.72
P01 = = = 119.68
n 4

12.5 Weighted Aggregative Index

Following methods are included under this category.
u Laspeyere’s method
u Paasche’s method
u Fisher’s ideal method
Laspeyere’s method: In this method, quantities of the base year are used as
weights for constructing price index number.
∑ p1q 0
P01 = ×100
∑ p0 q 0

where P01 = price index number

p1 = prices of commodities in current year
p0 = prices of commodities in base year
q0 = quantity of commodities in base year
On the other hand, base year price is used as weight for constructing quantity
index number.
∑ p1p0
Q01 = ×100
∑ p0 p0

where Q01 = quantity index number

q1 = quantity of commodities in current year
q0 = quantity of commodities in base year
p0 = prices of commodities in base year.
Para 12.5 Index numbers 318

Paasche’s method: In this method, quantities of the current year are used as
weights for constructing price index number.
∑ p1p1
P01 = ×100
∑ p0 p1

where P01 = price index number

p1 = prices of commodities in current year
p0 = prices of commodities in base year
q1= quantity of commodities in current year
On the other hand, current year price is used as weight for constructing
quantity index number.
∑ p1p1
Q01 = ×100
∑ p0 p1

where Q01 = quantity index number

q1 = quantity of commodities in current year
q0 = quantity of commodities in base year
p1 = prices of commodities in current year.
Fisher’s Ideal Method: This index is used by taking the geometric mean of
Laspeyere’s and Paasche’s index.
∑ p1q 0 ∑ p1q1
P01 = × ×100
∑ p0 q 0 ∑ p0 q1

∑ q1p0 ∑ p1q1
Q01 = × ×100
∑ q 0 p0 ∑ p0 q1

Fisher’s ideal index formula is known as ideal because of the following rea-
sons:
1. It involves the geometric mean which is theoretically considered to be
the best average while constructing index numbers.
2. Both current year prices and quantities are taken into account.
3. It satisfies both time reversal and factor reversal test.
4. It is free from bias. Laspeyer’s and Paasche’s method are biased in terms
of weights but in this formula, these weights are crossed geometrically.
There is a complete cancellation of biases which makes it unbiased.

Example 5 : On the basis of the following information, compute Fisher’s index

number.
319 weighted aggresative index Para 12.5

Commodity Price in base Qty in base Price in Qty in current

year year current year year
A 2 40 6 50
B 4 50 8 40
C 6 20 9 30
D 8 10 6 20
E 10 10 5 20
Solution:
Computation of Fisher’s Index number
Commodities p0 q0 p1 q1 p0q0 p0q1 p1q0 p1q1

A 2 40 6 50 80 100 240 300

B 4 50 8 40 200 160 400 320
C 6 20 9 30 120 180 180 270
D 8 10 6 20 80 160 60 120
E 10 10 5 20 100 200 50 100
Total 580 800 930 1110

∑ q1q 0 ∑ p1q1
P01 = × ×100
∑ q 0 q 0 ∑ p0 q1

930 1110
P01 = × ×100 = 1.6 ×1.39 × 100 = 149.1
580 800

Example 6: On the basis of the following information, compute Fisher’s index

number.
Commodities Price per unit Expenditure in Price per unit Expenditure in
in base year (`) base year (`) in current year current year
(`) (`)
A 2 40 5 75
B 4 16 8 40
C 1 10 2 24
D 5 25 10 60
Para 12.5 Index numbers 320

Solution:
Computation of Fisher’s Ideal index
Commodities p0 p0q0 q0p1 p1 p1q1 q1 p1q0 p0q1

A 2 40 40/2 = 20 5 75 75/5 = 15 100 30

B 4 16 16/4 = 4 8 40 40/8 = 5 32 20
C 1 10 10/1=10 2 24 24/2 = 12 20 12
D 5 25 25/5 = 5 10 60 60/10=6 50 30
Total 91 199 800 202 92

∑ p1q 0 ∑ p1q1
P01 = × ×100
∑ p0 q 0 ∑ p0 q1

202 199
P01 = × × 100 = 219.12
91 92

Example 7: On the basis of the following information, compute Laspeyer’s,

Paasche’s and Fisher’s index number.
Commodity Price in base Qty in base Price in Qty in current
year year current year year
A 10 30 12 50
B 8 15 10 25
C 6 20 6 30
D 4 10 6 20
Solution:
Computation of Index numbers
Commodities p0 q0 p1 q1 p0q0 p0q1 p1q0 p1q1
A 10 30 12 50 300 500 360 600
B 8 15 10 25 120 200 150 250
C 6 20 6 30 120 180 120 180
D 4 10 6 20 40 80 60 120
Total 580 960 960 1150
(1) Laspeyer’s method
∑ p1q 0 690
P01 = ×100 = × 100 = 118.9
∑ p0 q 0 580

321 weighted aggresative index Para 12.5

(2) Paasche’s method

∑ p1q1 1150
P01 = ×100 = × 100 = 119.8
∑ p0 q1 960

(3) Fisher’s method
∑ p1q 0 ∑ p1q1
P01 = × ×100
∑ p0 q 0 ∑ p0 q1

690 1150
= × ×100 = 1.4251 × 100 = 119.4
580 960

Example 8: On the basis of the following information, compute quantity index

number by Fisher’s method.
Commodity Price in base Qty in base Value in cur- Qty in current
year year rent year year
A 25 40 2000 50
B 22 18 1200 30
C 54 16 1320 44
D 20 40 1350 45
E 18 30 630 15
Solution:
Computation of Quantity Index number
Commodities p0 q0 p1=value/qty q1 p0q0 q1p0 q0p1 q1p1
A 25 40 2000/50=40 50 1000 1250 1600 2000
B 22 18 1200/30=40 30 396 660 720 1200
C 54 16 1320/44=30 44 864 2376 480 1320
D 20 40 1350/45=30 45 800 900 1200 1350
E 18 30 630/15=42 15 540 270 1260 630
Total 3600 5456 5260 6500
By Fisher’s method
∑ q1p0 ∑ q1p1
Q01 = × ×100
∑ q 0 p0 ∑ q 0 p1

5456 6500
= × ×100 =136.85
3600 5260

Example 9: On the basis of the following information, compute Laspeyer’s,

Paasche’s and Fisher’s index number.
Para 12.5 Index numbers 322

Commodity Price in base Qty in base Price in current Qty in current

year year year year
A 8 4 10 9
B 7 3 8 4
C 6 4 7 8
D 5 2 5 4
Solution:
Computation of Index numbers
Commodities p0 q0 p1 q1 p0q0 p0q1 p1q0 p1q1
A 8 4 10 9 32 40 72 90
B 7 3 8 4 21 24 28 32
C 6 4 7 8 24 28 48 56
D 5 2 5 4 10 10 20 20
Total 87 102 168 198
(1) Laspeyer’s method
∑ p1q 0 168
P01 = ×100 = × 100 = 193.1
∑ p0 q 0 87

(2) Paasche’s method
∑ p1q1 198
P01 = ×100 = × 100 = 194.12
∑ p0 q1 102

(3) Fisher’s method
∑ p1q 0 ∑ p1q1
P01 = × ×100
∑ p0 q 0 ∑ p0 q1

168 198
= × ×100 =193.61
87 102

Example 10: On the basis of the following information, compute quantity index
by using appropriate formula.
Commodity Price in base year Qty in base year Qty in current year
A 10 10 12
B 16 6 7
C 12 3 4
Solution : Since we are not given current year prices, only laspeyers method is
applicable here.
323 weighted aggresative index Para 12.5

Computation of Quantity Index number

Commodities p0 q0 q1 q0p0 q1p0

A 10 10 12 100 120
B 16 6 7 96 112
C 12 3 4 36 48

Total 232 280

∑ q1p0 280
Q01 [Laspeyers] = × 100 = × 100 = 120.68
∑ q 0 p0 232

Example 11: If the ratio between Laspeyers and Passche index number is 28:27.
Find missing figure in the following data.
Commodity Price in base Qty in base Qty in current Price in
year year year current year
A 1 10 5 2
B 1 5 2 ----
Solution:
Computation of Missing Figure
Commodities p0 q0 p1 q1 p0q0 p0q1 p1q0 p1q1

A 1 10 2 5 10 5 20 10
B 1 5 x 2 5 2 5x 2x

Total 15 7 20 + 5x 10 + 2x
∑ p1q 0 20 + 5x
L= p01 [Laspeyers] = × 100 = × 100
∑ p0 q 0 15

∑ p1q1 10 + 2x
P = P01[Paasche’s] = × 100 = × 100
∑ p0 q1 7

It is given that L = 28
P 27
20 + 5x
× 100
28
⇒ 15 =
10 + 2x 27
× 100
7
20 + 5x 7 28
⇒ × =
15 10 + 2x 27

x=4
Para 12.6 Index numbers 324

Example 12: On the basis of the following information, compute Laspeyer’s price
index and Paasche’s quantity index number.
Commodity Qty. in base Qty in current Value in base Value in current
year year year year
A 100 150 500 900
B 80 100 320 500
C 60 72 120 360
D 30 33 360 297
Solution:
Computation of Index numbers
Commodities q0 q1 p0q0 p1q1 p0 p1 p1q0 p0q1

A 100 150 500 900 5 6 600 750

B 80 100 320 500 4 5 400 400
C 60 72 120 360 2 5 300 144
D 30 33 360 297 12 9 270 396
Total 1300 2057 1570 1690
(1) Laspeyer’s method
∑ p1q 0 1570
P01 = × 100 = × 100 = 120.77
∑ p0 q 0 1300

(2) Paasche’s method
∑ q1p1 2057
Q01 = × 100 = × 100 = 131.02
∑ q 0 p1 1570

12.6 VALUE INDEX

The value of a commodity is defined as the product of its price and quantity.
Value index can be obtained by comparing the value of commodities in cur-
rent year by value of commodities in base year.
∑ p1q1
Value index = V01 = × 100
∑ p0 q 0

Example 13: Compute value index from the data given below.

Commodity Price in 2000 Qty in 2000 Price in 2003 Qty in 2003

A 2 8 4 6
B 5 10 6 5
C 4 14 5 10
D 2 19 2 13
325 value index Para 12.6

Solution:
Computation of Value Index
Commodities p0 q0 p1 q1 p0q0 p1q1
A 2 8 4 6 16 24
B 5 10 6 5 50 30
C 4 14 5 10 56 50
D 2 19 2 13 38 26
Total 160 130
∑ p1q1 130
V01 = × 100 = × 100 = 81.25
∑ p0 q 0 160

Exercise:
Q1. Construct fisher’s ideal index from the data given below:
Commodity Price in 2000 Qty in 2000 Price in 2003 Qty in 2003
A 10 6 15 5
B 12 10 15 10
C 18 5 27 3
D 8 5 12 4
Q2. Construct fisher’s ideal index from the data given below:
Commodity Price in 2013 Qty in 2013 Price in 2014 Qty in 2014
A 10 20 12 20
B 6 10 8 8
C 5 5 7 8
D 4 5 4 6
Q3. On the basis of the following information, compute Laspeyer’s, Paasche’s
and Fisher’s index number.
Commodity Price in base Qty in base Price in cur- Qty in cur-
year year rent year rent year
A 20 8 40 6
B 50 10 60 5
C 40 15 50 15
D 20 20 20 25
Para 12.6 Index numbers 326

Q4. Construct fisher’s ideal index from the data given below:
Commodity Price in base Qty in base Price in cur- Qty in cur-
year year rent year rent year
A 6 50 10 60
B 2 100 2 120
C 4 60 6 60
Q5. Construct fisher’s ideal index from the data given below:
Commodity Price in base Qty in base Price in cur- Qty in cur-
year year rent year rent year
A 6 50 10 60
B 2 100 2 120
C 4 60 6 60
Q6. Construct fisher’s ideal index from the data given below:
Commodity Price in base Qty in base Price in Qty in
year year current year current year
A 4 8 5 8
B 5 10 6 12
C 3 6 4 7
D 8 5 10 4
Q7. Construct price index , quantity index by fisher’s method from the data
given below. Also compute value index.
Commodity Price in base Qty in base Value in Qty in
year year current year current year
A 2 8 24 6
B 5 10 30 5
C 4 14 50 10
D 2 19 26 14
Q8. Construct price index and quantity index by fisher’s method from the
data given below. Also calculate value index.
Commodity Price in base Qty in base Price in cur- Qty in cur-
year year rent year rent year
Wheat 8 10 20 30
Sugar 6 9 14 18
Tea 2 5 15 20
Q9. Construct price index and quantity index by fisher’s method from the data
given below.
327 value index Para 12.6

Commodity Price in base Value in base price in cur- Value in cur-

year year rent year rent year
A 10 100 12 96
B 8 96 8 104
C 12 144 15 120
D 20 300 25 250
E 5 40 8 64
F 2 20 4 24
Q10. Compute price index number by simple average of price relatives
method.
Commodity Price in base year Price in current year
A 2.00 4.50
B 2.50 3.20
C 3.00 4.50
D 1.00 1.80

ANSWERS:

A1. P01 = 435 354

× × 100 = 139.3
310 256

A2. P01 = 375 384

× × 100 = 123
305 312
∑ p1q 0 2070
A3. P01[Laspeyers] = × 100 = × 100 = 124.70
∑ p0 q 0 1660

∑ p1q1 1790
P01[Paasche’s] = × 100 = × 100 = 121.77
∑ p0 q1 1470

2070 1790
P01 [Fishers] =
× × 100 = 123.24
1660 1470

A4. P01 [Fishers] = 1060 × 1200 × 100 = 143

740 840

A5. P01 [Fishers] = 174 × 180 × 100 = 124.21

140 145

A6. P01 [Fishers] = 200 130

× × 100 = 125.6
160 103
Para 12.6 Index numbers 328

103 130
Q01 [Fishers] =
× × 100 = 64.68
160 200

130

V01 = × 100 = 81.25
160

388 562
A7. P01 [Fishers] = × × 100 = 140.88
274 401

401 562
Q01 [Fishers] = × × 100 = 145.59
274 388

562
V01 = × 100 = 205.109
274

A8. P [Fishers] = 875 658

01 × × 100 = 124.35
700 532
∑ p1q 0 209
A9. P01 [Laspeyers] = × 100 = × 100 = 133.97
∑ p0 q 0 156
∑ p1q1 183

P01 [Paasche ' s] = × 100 = × 100 = 128.87
∑ p0 q1 142

209 183
P01 [Fishers] =
× × 100 = 131
156 142

683
A10. P01 = × 100 = 170.75
4
 C H A P T E R

13 MATHEMATICS OF FINANCE

Learning Objectives
By the end of this chapter, you will be able to understand:
u Concept of simple interest and compound interest.
u Concept of continuous compounding.
u How to find present value of money due in the future or the future value
of money presently invested.
u Meaning of annuity and its types.
u Present and future value of annuity.
u Solving amortization problems.

13.1 INTRODUCTION
Financial mathematics is of great importance in our day to day life. The entire
operation in banking, insurance, property dealing etc. are based on the concept
of money belonging to one individual that may be used by others in return
for periodic payments. Interest plays an important role in almost all the finan-
cial activities. Many people have set up their own finance companies and are
earning a lot. In this chapter, we discuss some of the basic topics of finance.

13.2 BASIC TERMINOLOGY OF FINANCE

(a) Principal amount (P): It is the amount of money that is to be invested
or it may refer to the initial value or cost of the plant or machinery. It
is the capital originally invested.
(b) Rate of interest (r): Interest is the name given to a proportionate amount
of money which is added to some principal amount. It is denoted by r
and is expressed as percentage rate per annum.
329
Para 13.3 Mathematics of Finance 330

(c) Number of periods (n): It is the number of time periods over which
amounts of money are being invested or borrowed. It is denoted by n.
(d) Simple interest: This is where any interest earned is not added back to
the previous amount invested.
(e) Compound interest: This is where interest earned is added back to the
previous amount accrued.
(f) Amount: It is the sum of the principal and the interest.
(g) Capital: It is the stock of accumulated wealth – money or its equivalent.
(h) Consideration: It is the fee.

13.3 SIMPLE INTEREST

Simple interest denoted by S is the interest computed on the principal for the
entire period it is borrowed. It is given by:

Simple interest = S = Prt

Amount = P +S = P(1+rt)
where S = Simple interest
P = principal
R = rate of interest (in decimal form)
T = Time in years
A = amount

Example 1: Compute the simple interest and amount on ` 2000 for 4 years at 6%
rate of interest.
Solution: Here we have , P = 2000 , r = 0.06 , t = 4
We know that S = Prt.
Then S = (2000)(0.06)(4) = `480.
Amount = A = P + S = 2000 + 480 = ` 2480

Example 2: At what rate of interest will `2500 yield ` 300 in simple interest in
3/2 years?
Solution: We are given S = 300, P = 2500, t = 3/2
Now, S = Prt. Therefore, 300 = 2500 × r ×3/2
300 × 2
⇒ r = =.08 or 8%
2500 × 3
Example 3: How much interest will be earned if ` 48,000 will be invested at the
1
rate of 8 % per annum simple interest for 2 years 3 months.
2
331 Simple interest Para 13.3

Solution: We have P = 48000, Rate = r = 17/2 , t =2 years 3 months =  2 + 1  = 9

years.


 4 4
17 9
Then s = Pr t = 48000 × × = ` 9180
2 × 100 4
Example 4: Find the simple interest on ` 1820 for March 9 , 2003 to May 21 , 2003
1
at 7 % rate per annum.
2
15 74
Solution : We have P = 1820 , r = % = 0.075, t = 74 days = years.
2 365
74
Then S = Prt = 1820 × 0.075 × 365 = ` 27.67

Example 5: A person borrows ` 5000 for 2 years at 4% per annum simple interest.
1
He immediately lends it to another person at 6 % rate per annum for 2 years.
Find his total gain in transaction. 2

Solution: Simple interest paid by the person in first transaction = S = Prt =

5000 × 0.04 × 2 = 400
Simple interest paid to the person in second transaction = S = Prt = 5000 ×
25
× 2 = 625
4 × 100
Total Gain = 625 – 400 = `225

Example 6: Find the sum if simple interest at x % for x years is ` x .

Solution: We have S = Prt
x
⇒ x = P× ×x
100

100
⇒P=
x .

 100 
Therefore, sum is `   if simple interest at x % for x years is ` x.
 x 
Example 7: A man borrowed a certain sum of money at 6% per annum rate of
interest for the first three years, 9% for next five years, 13% p.a for the period
beyond eight years. If the total interest paid by him at the end of eleven years
is ` 8160, how much money did he borrow?
Solution: Let P be the sum borrowed. Firstly r = 0.06, t = 3
Then S = Prt = P × 0.06 × 3 = 0.18P
Secondly, r = 0.09, t = 5, then S = Prt = P × 0.09 × 5 = 0.45P
Para 13.3 Mathematics of Finance 332

Thirdly, r = 0.13, t = 11-5-3 = 3 years then S = Prt = P × 0.13 × 3 = 0.39P

According to the given information, 0.18P + 0.45P + 0.39P = 8160
⇒ 1.02P = 8160

⇒ P = `8000

Example 8: Find the simple interest on ` 10 for 4 months at the rate of 3 paise
per rupee per month.
Solution: Interest on 1 rupee per month = 0.03
Interest on 100 rupee per month = 0.03× 100 = 3
Therefore, r = 3% or 0.03 per month.
Now P = 10, r = 0.03, t = 4 months. Then S = Prt 10 × 0.03 × 4 = ` 1.20

Example 9: How long will it take for ` 3000 to amount to `3300 at 4 % simple
interest?
Solution: We have P = 3000, A = 3300 , r = 0.04
Then A = P + S = P(1 + rt)
 3300 = 3000(1 + 0.04t)
 1.1 = 1 + 0.04t  t= 2.5 years

Exercise 13.1
Q1. Find the simple interest on ` 500 for 3 years at 4% , and find the amount.
Q2. Find the time required for ` 2500 to yield ` 300 in simple interest at 8% .
Q3. At what interest rate will ` 3000 yield ` 120 in simple interest in 6 months?
1
Q4. What principal will amount to `645 in 1 years at 5 % simple interest?
2
Q5. Find the principal that will amount to ` 3120 in 6 months at 8 % simple
interest?
Q6. A sum of ` 12500 amounts to ` 15500 in 4 years at the rate of simple
interest. Find the rate of interest?
Q7. A man borrowed ` 1200 with simple interest for as many as years as the
rate of interest. If he paid ` 432 as interest at the end of period , what
was the rate of interest?
Q8. A man paid ` 5400 as interest on a certain sum of money borrowed by
him at 12 % per annum simple interest for 3 years. Find the amount
borrowed by him.
Q9. What is the present worth of ` 132 due in 2 years at 5 % simple interest
per annum?
333 Simple interest Para 13.3

Q10. ` 800 becomes ` 956 in 3 years at a certain rate of simple interest . If the
rate of interest is increased by 4 % , what amount will ` 800 become in
3 years?
Q11. In how many years ` 150 will produce the same interest at the rate of
8% as ` 800 produce in 3 years @ 4.5% ?
Q12. How much additional interest will be earned in one year on a certain
sum of money at 5% per annum if it is given that the interest in that sum
at 4.5% per annum is ` 202.50 in one year?
Q13. Find the ratio of simple interest earned by certain amount at the same
rate of interest for 6 years and that for 9 years?
Q14. A sum of money amounts to ` 815 in 3 years at simple interest. It amounts
to ` 854 in 4 years. Find the sum and rate of interest.
Q15. A sum of money at simple interest doubles in 6 years. In how much time
will it become 4 times?
Q16. How long will it take for a sum of money invested at 5% p.a simple interest
to increase its value by 40%?
Q17. Mr. X lends ` 2500 to Y and a certain sum to Mr. Z at the same time at
7% p.a simple interest. If after 4 years, Mr. X altogether receives ` 1120
as interest from Mr. Y and Mr. Z then find the sum lent to Mr. Z.
Q18. A man invested ` 12000 at the rate of 10% p.a simple interest. He also
invested another sum of money @ 20% p.a simple interest. The total
interest earned on the two investments at end of one year became 14 %
p.a. Find the total money invested.

Answers
A1. S = ` 6 0 and A = ` 560
A2. 1.5 years
A3. 8 %
A4. ` 600
A5. ` 3000
A6. 6%
A7. 6 %
A8. ` 1500
A9. `120
A10. ` 1052
A11. 9 years
A12. `22.50
Para 13.4 Mathematics of Finance 334

A13. 2:3
A14. P= ` 698 , r = 5.58%
A15. 18 years
A16. 8 years
A17. ` 1500
A18. ` 20,000

13.4 COMPOUND INTEREST

Compound interest involves interest on interest. Interest may be converted
into principal annually, semi – annually, quarterly, monthly or at any other
regular intervals. The frequency of conversion is the number indicating how
many times interest is compounded in one year. The time between the two
successive conversions is called conversion period. The total amount due at
the end of the last period is called the compounded amount. It is given by:

r
Compound Amount = a = P(1 + i)n where i =
k
P = Principal
r = annual rate of interest
k = number of times the interest is compounded
in a year.
n= number of conversion periods.
Then Compound interest = C.I= A - P

Example10: Find the compound interest on ` 1200 at 5 % for 5 years compounded

quarterly.
Solution: We are given that P= 1200 , r = 0.05 , k = 4 , n = 5 × 4 = 20

Now, i = r = 0.05 = 0.0125

k 4
We know that A = P(1 + i)n = 1200(1 + 0.0125)20 = 1200(1.0125)20
Let y = (1.0125)20 Take log on both sides we get,
log y = 20 log (1.0125)
 log y = 20 (0.0054) = 0.108
 y = anti log (0.108) = 1.282
Therefore A = 1200 × 1.282 = `1538.4
Then C.I = A – P = 1538.4 – 1200 = ` 338.4
335 compound interest Para 13.4

Example 11: How long will it take ` 700 to amount to ` 2270 at 8 % compounded
semi- annually.
r 0.08
Solution: We are given P = 700 , A = 2270 , i = = = 0.04
k 2
We know that A = P(1+i)n
 2270 = 700 (1+0.04)n
2270

⇒ = (1.04)n
700
 3.24 = (1.04)n
Take log on both sides we get,
 log(3.24) = n log(1.04)
0.51
⇒ 0.51 = n(0.0170) ⇒ n= = 30
0.0170
It takes 30 semi- annual periods or 15 years.

Example 12: Calculate the difference between the compound interest on ` 5000
1
for 1 years at 4 % p.a compounded annually and semi – annually.
2
Solution: When compounded annually:

We have P =5000, i = r = 0.04 = 0.04 , n = 3/2 =1.5

k 1
We know that A = P (1+i) n

1.5
= 5000 (1 + 0.04 ) = 5000(1.04)1.5

Let y = (1.04)1.5.
Take log on both sides we get,
log y = 1.5 log (1.04)
 log y = 1.5 (0.01703) = 0.025545
 y = anti log (0.025545) = 1.0606
Then  A = 5000(1.0606) = `5303
Therefore C.I = A – P = 5303 – 5000 = ` 303
When compounded Semi - annually:
r 0.04 3
We have P =5000, i = = = 0.02 , n = ×2=3
k 2 2
We know that A = P (1+i)n
= 5000 (1+0.02)3 = 5000 (1.02)3 = 5306.04
Para 13.4 Mathematics of Finance 336

Then C.I = A – P = 5306.04 – 5000 = ` 306.04

Difference in C.I = 306.04 – 303 = ` 3.04
Example 13: A man borrowed `12,500 from a bank @ 20 % p.a compound interest.
At the end of every year , he pays ` 2000 as part re-payment. How much does
he still owe after three such instalments?
r 0.20
Solution: We are given that P = 12500, i = = = 0.20 , n =1
k 1
Then A = P (1+i)n = 12500 (1+0.20) = 15000
After paying ` 2000, amount to be repaid = 15000 – 2000 = 13000
Therefore, Principal for next year = ` 13000
Then  A = 13000(1 + 0.20) = 15600
After paying ` 2000, amount left = 15600 – 2000 = ` 13600
Principal for third year = 13600
 A = 13000(1 + 0.20) = 16320
After paying the third instalment of ` 2000, amount left = 16320 – 2000 = ` 14320
Therefore, he still owe ` 14320.

Example 14: In return of a promise to pay ` 500 at the end of 10 years, a person
agrees to pay ` 100 now, ` 200 at the end of 6 years, and a final instalment
at the end of 12 years. If the rate of interest is 2% per annum effective, what
should the final instalment be?
Solution: Let the final instalment be ` x
Then amount corresponding to ` 100 which is paid in the beginning will earn
interest at the rate of 2 % per annum for 10 years and is given by 100 (1+0.02)10
Similarly, ` 200 is given at the end of 6 years. Therefore, interest will be com-
pounded on ` 200 for 10-6 = 4 years at r = 2 %.
Therefore, amount corresponding to ` 200 will be 200 (1+0.02)4
But final instalment of ` x is made at the end of 12th year. Therefore, term
corresponding to ` x will be × (1+0.02)2
According to the given information ,
100 (1+0.02)10 + 200 (1+0.02)4 + x (1+0.0.2)-2 = 200
x
⇒ 121.89 + 216.48 + = 500
(1.02)2
x
⇒ = 500 − 121.89 − 216.48
(1.02)2
⇒ x = 161.63 × (1.02)2 = 168

Therefore the final instalment = ` 168

337 compound interest Para 13.4

Example 15:A manborrows ` 750 from a money lender and the bill is renewed
after every half year at an increase of 21%. After how much time the amount
of bill will become ` 7500?
Solution: Let it takes x years for the amount of bill to become ` 7500. Then
750 (1+0.21)2x = 7500
 (1.21)2x = 10
 2x log(1.21) = log(10) = 1
 2x(0.0828) = 1
 x = 6.04
Thus it takes about 6 years for the amount of bill to become ` 7500.

Example 16:A certain sum of money is invested at 4 % compounded annually. The

interest for the second year is ` 25. Find the interest for the third year.
Solution: Let P be the principal. Then
Amount at the end of first year = P(1.04)
Amount at the end of second year = P(1.04)2
Amount at the end of third year = P(1.04)3
Therefore, interest for the second year = P(1.04)2 - P(1.04)
It is given that interest for the second year = 25, therefore,
P(1.04)2 - P(1.04) = 25
⇒ P (1.04)2 − 1.04  = 25

 P(1.04)(1.04 - 1) = 25
 P(1.04)(0.01) = 25
The interest for the third year = P(1.04)3 - P(1.04)2
= P(1.04)2 (1.04 - 1)
⇒ P(1.04)2 (1.04)(0.04) = 25 × 1.04 = ` 26

Example 17: A sum of money is put at compound interest for two years at 20%
p.a. It would fetch ` 482 more, if the interest were payable half yearly than if
it were payable yearly. Find the sum.
Solution: Let P be the principal. Then the amount of ` P at the end of two years
at 20 % per annum compounded annually = P(1.20)2 = P(1.44)
Also, the amount of ` P at the end of two years at 20 % p.a compounded semi
– annually is = P(1.10)4 = P(1.4641)
According to the given information, P(1.4641) – P(1.44) = 482
 P(0.0241) = 482  P = 20000
Para 13.5 Mathematics of Finance 338

Example 18: A sum of money is deposited in a bank which compounds interest

semi – annually. The amount at the end of 4 years is ` 6333.85 and the amount
became ` 8023.53 at the end of 8 years. Find the money deposited and the
interest rate.
Solution: According to the given information,
8 16
 r  r
P 1 +  = 6333.85 and P 1 +  = 8023.53
 2  2
Dividing, we get
8
r 8023.53
1 + 2  = 6333.85 =1.267 (approx.)


 r
⇒ 8 log 1 + = log(1.267)=0.1028
 2 

 r  0.1028
⇒ log 1 +  = = 0.01285
 2 2
 r
⇒ 1 +  = anti log(0.01285) = 1.030
 2
 r = 0.06 or 6%
∴ P(1.03)8 = 6333.85
 P(1.2667008) = 6333.85
 P = 5000
Hence the money deposited is ` 5000 and rate of interest is 6 %.

13.5 INTEREST COMPOUNDED CONTINUOUSLY

We know that if a principal P is invested for t years at an annual rate of r and
interest is compounded m times a year, then the interest rate per conversion
period is r/m and there are mt conversion periods. In such a case , the com-
pound amount S is given by :
mt
 r
s = P 1 + 
 m
Now, if we take m → ∞ , i.e., number of times the interest is compounded gets
larger and larger. We say that interest is compounded continuously. In such
a case, we have
mt
 r
s = lim P 1 + 
m →∞  m
339 Interest compounded continuously Para 13.5

mt
 r
= P lim 1 + 
m →∞  m
rt
m/r
 r 
= P lim 1 +  
m →∞ 
 m  
rt
m/r
  r 
= P  lim 1 +  
 m→∞  m  
r
If we let = x, then as m → ∞ , we have x → 0 . Thus
m

rt
1/x
s = P  lim (1 + x )  = Pe rt
 x→0 
Hence the compounded amount S of a principal P after t years at an annual
interest rate of r compounded continuously is given by

s = Pe rt
where S = Compound amount
r= rate of interest
t = time in years

Example 19: If ` 1000 is invested at an annual rate of 9 % compounded continuously,

find the amount at the end of 6 years.
Solution: We are given that P = 1000, r = 0.09 , t = 6
We have S = Pert = 1000 × e 0.09×6 =1000 × e 0.54
Take log on both sides we get,
log S = log(1000) + 0.54 log e
 log S = 3 + 0.54(0.4343) = 3.234522
 S = anti log(3.234522)
 S = ` 1716

Example 20: If interest is compounded continuously, at what annual rate will a

principal of P quadruples in 10 years?
Solution: Let r be the annual rate of interest compounded continuously. Then,

s = Pe rt
 4P = Pe10r
 4=e10r
Para 13.6 Mathematics of Finance 340

Take log on both sides we get,

log 4 = 10r loge
 0.6020 = 10(0.4343)(r)
 r =0.1386 or 13.86%

Example 21: How long will it take for ` 4000 to amount to ` 7000 if it is invested
at 7 % compounded continuously?
Solution: We have P = 4000, S = 7000, r = 0.07

s = Pe rt
 700 = 4000e0.007t
 1.75 = e0.07t
 log 1.75 = 0.07t log e
 0.2130 = (0.07)(0.4343)t
 0.2430 = (0.030401)t
 t = 7.99 8years (approx.)

13.6 COMPOUND AMOUNT AT CHANGING RATES

So far we have discussed the problems concerning with constant rate of interest
for the entire duration of investment. But there may be times when interest
changes from time to time. For example, a bank pays interest of 8 % when
an investment is made, may raise it to 8.5 % after few years and later on may
reduce it to 7.5 %. The final compound amount is the product of the original
principal and two or more expressions of the form (1+i)n or ert depending upon
the conditions.

Example 22: A person deposited ` 4000 in a bank at 6% compounded continuously.

After 3 years, the rate of interest was increased to 7 % and after 5 more years,
the rate was further increased to 8%. The money was withdrawn at the end of
10 years. Find the amount.
Solution: Amount due = 4000e0.06×3 × e0.07×5 e0.08×2
= 4000e0.18 ×e0.35 × e0.16
= 4000e0.18+0.35+0.16
= 4000e0.69
= 4000 × 1.9937
= `7974.8

Example 23: A man made a deposit of ` 5000 in a savings account. The deposit
was left to accumulate at 6 % compounded quarterly for the last 5 years and
341 compound amount at changing rates Para 13.6

8 % compounded semi- annually for the next 8 years. Find the amount at the
end of 13 years.
r 0.06
Solution: For the first five years, we have i = = = 0.015 , n=5× 4 =20
k 4
r 0.08
For the next eight years, we have i = = = 0.04 and n = 8 × 2 = 16
k 2
Then the amount at the end of 13 years = 5000 (1+0.015)20 (1+0.04)16
= 5000 × 1.34685 × 1.87298 = ` 12613 approx

Example 24: Rohit deposited ` 10,000 in a bank for 3 years offering interest rate of
6 % compounded half–yearly during first year, at the rate of 12% compounded
quarterly during second year and at 10% compounded continuously during
third year. Find his balance after 3 years.
2 4
 0.06   0.12  0.10
Solution: Balance after 3 years = 10000 1 + 1+ e
 2 
 
 4 
= 10000 (1.03)2 (1.03)4 e0.10
= 10000 (1.03)6 e0.10 ` 13196.64

Example 25 : Amachine depreciates at the rate of 10% p.a for the first two years
and then 7% p.a for the next 3 years, depreciation being calculated on the
diminishing value. If the value of the machine be ` 10,000 initially, find the
average rate of depreciation and the depreciated value of the machine at the
end of the fifth year.
Solution: Value of the machine at the end of the fifth year =
= 10000(1 - 0.10)2(1 - 0.07)3
= 10000(0.9)2(0.93)3 = ` 6515.29
Let r be the average rate of depreciation.
Then 6515.29 = 10000(1 - r)5
 log (6515.29) = log (10000) + 5 log(l - r)
 5 log (1 - r) = 3.8139 - 4 = -0.1861
 log (1 - r) = 0.03722 = 1.96278
 (1 - r) = anti log (1.96278) = 0.91786
 r = 8.214%

Example 26: Ram left `50,000 to be divided between his two daughters A and B.
A’s share was to amount to a certain sum of money at the end of 5 years and
B’s share was to amount to an equal amount at the end of 7 years. If the rate
of interest is 6% compounded annually, find the amount.
Solution: Let A’s share be ` x . Then share of B is ` (50000-x).
Para 13.6 Mathematics of Finance 342

Amount on A’s share at the end of 5 years = x(1.06)5

Amount on B’s share at the end of 7 years = (50000- x )(1.06)7
According to the given information: x(1.06)5 = (50000 - x )(1.06)7
Then x = (50000 – x )(1.06)2
x= (50000 – x )(1.1236)
x= ` 26455
So amount = x(1.06)5 = 26455(1.06)5 = ` 35402.76

Exercise 13.2
Q1. Hari deposits ` 5000 in his bank account which pays an interest of 11
% p.a compounded semi – annually. How much amount will be in his
account after 2 years?
Q2. A certain sum of money amounts to ` 2420 at the end of second year
and ` 2500 at the end of third year. Find the rate of interest and the sum
invested.
Q3. The compound interest on a certain sum of money for two years is `126
and simple interest for two years at the same rate is ` 120. Find the rate
of interest.
Q4. The difference between compound interest and simple interest on a
certain sum of money put out for 2 years at 10% p.a is ` 6. Find the sum.
Q5. Find the compound interest on ` 6950 for 3 years if interest is payable
semi- annually, the rate for the first two years being 6 % p.a and for the
third year 9 % p.a.
Q6. Find the compound amount of ` 2000 for 4 years at 6% converted (i)
annually (ii) Semi- annually (iii) Quarterly (iv) Monthly
Q7. Find the compound amount and the compound interest of ` 700 invested
for 15 years at 8% compounded semi- annually.
Q8. How long will it take for `1200 to amount to ` 2000 at 5 % converted
quarterly?
Q9. A person deposits `5000 in a bank which pays an interest of 11% p.a
compounded continuously. How much amount will be in his account
after 10 years?
Q10. A national savings certificate costs ` 15 and realises ` 20 after 10
years. Find the rate of interest involved when it is added (i) yearly (ii)
continuously.
Q11. If interest is compounded continuously, at what annual rate will a
principal of P double in 10 years?
343 compound amount at changing rates Para 13.6

Q12. If interest is compounded continuously at an annual rate of 7 % , how

many years would it take for a principal P to triple?
Q13. A man invested `8000 in a fixed deposit for 2 years at compound interest
rate 5 % p.a .How much money will he get on maturity of the fixed
deposit? Also find compound interest.
Q14. A man deposits ` 1600 each on 1st January and 1st July of a year in a
bank. The bank offers 5 % compound interest calculated on half yearly
basis. Find the amount he gain at the end of year.
Q15. It is given that compound interest on ` 30,000 at 7 % p.a is `4347. Find
the time in years.
Q16. Find the amount of annual payment that will discharge a loan of `1025
due in 2 years @ 5 % p.a compound interest.
Q17. A man paid two instalments of `882 each to pay back the sum borrowed
at 5 % compound interest. Find the sum borrowed by him.
Q18. The sum of `2000, `3000, `4000 are due at the end of 2, 4 and 8 years
respectively. It is proposed to replace this series of payments by a single
sum of ` 9000 payable at the end of n years. If the rate of interest is10
% per annum effective, find n.
Q19. How long will it take `1200 to amount to `2000 at 5% converted quarterly?
Q20. A machine depreciates at the rate of 8 % of its value at the beginning of a
year. The machine was purchased for `100000. The scrap value realised
when sold was ` 43440. Find the number of years the machine was old.
Q21. If the interest is compounded continuously at an annual rate of 7% , how
many years would it take for a principal P to triple?
Q22. A manmade a deposit of ` 2500 in a savings account. The deposit was
left to accumulate at 6 % compounded quarterly for the first 5 years
and at 8 % compounded semi- annually for the next 8 years. Find the
compound amount at the end of 13 years.
Q23. Mr. A borrowed ` 20,000 from a bank for 6 years @8% p.a compounded
quarterly and `18000 from a friend @ 8% compounded continuously
for the same period of time. Find his total liability after six years.
Q24. A sum of `60000 is invested in a scheme which provides for interest at
6% p.a compounded half-yearly for the first three years and at 5% p.a
compounded continuously for the next two years. Calculate the amount
receivable on maturity.
Q25. A certain sum of money is invested @9% compounded quarterly. How
long will it take for the money to double?
Q26. A certain sum of money at compound interest becomes `6655 in 3 years
and `7320.50 in four years. Find the rate of interest.
Para 13.6 Mathematics of Finance 344

Answers
A1. ` 6195
A2. Sum is invested at 3.3 % rate of interest and sum invested is ` 2261.68
A3. R = 10.08%
A4. ` 600
A5. ` 1589.
A6 (i) ` 2524.95 (ii) `2533.54 (iii) `2537.97 (iv) `2540.97
A7. Amount = `2270.37 , compound interest = `1570.37
A8. 42 quarterly periods or 10 years and 5 months.
A9. `15020 (approx.)
A10. (i)2.92% (ii) 2.88%
A11. 6.9%
A12. 16 years approx.
A13. A = `8820 and C.I = `820
A14. Gain = ` 121
A15. 2 years.
A16. `551.25
A17. ` 1640.
A18. 5 years approx.
A19. 10 years and 6 months approx.
A20. 10 years approx.
A21. 15.69 years
A22. ` 6306.55 approx
4×6
 0.08 
A23. a = 20000 1 + + 18000e 0.8×6 = 61259 approx .
 4 
2×3
A24. A = 60000 1 + 0.06  e 0.05× 2 = 79183.16
 2 
4t
 0.09 
A25. 2P = P 1 + ⇒ t = 76 years
 4 
1
r 
A26. 7320.50 = 6655 1 + ⇒ r = 10%
 100 
345 present value or capital value Para 13.7

13.7 PRESENT VALUE or CAPITAL VALUE

In order to determine the original invested principal to receive a certain desired
amount S at some later date, we use the concept of present value. Since we
know from compound interest formula that A = P(1 + i)n
We get that the present value of amount S due n periods hence at the rate I
per period is given by:

P = S (1 + i)-n
where P= present value
S = amount
i = rate per period
n = number of periods.
Remark: The quantity (1+i)-n is called the discount factor. It represents the
value of `1 due n periods hence at the rate i per period .
In case of continuous compounding, the present value of S due at the end of
t years at the annual rate of r is given by:

P = Se-rt
where P=present value of S
S = amount
t= number of years
r=annual rate of interest compounded continuously

Example 27: Find the present value of ` 6000 due in 20 years at 5% compounded
annually.
Solution: We have r =0.05, S = 6000, n = 20
6000
P = s(1 + i)− n = 6000(1 + 0.05)−20 =
(1.05)20
Let y = (1.05)20
Then logy = 20 log (1.05) = 20 × 0.021189= 0.42378
 y = anti log(0.42378) = 2.65326
6000
∴P = =` 2261.36
2.65326

Example 28: A person invests money in a bank paying 6% compounded semi –

annually. If the person expects to receive `8000 in 6 years, what is the present
value of the investment? What if compounded continuously.
Para 13.7 Mathematics of Finance 346

Solution: When compounded semi - annually

r 0.06
We have r =0.06, k =2 S = 8000, n = 6×2=12 i = = = 0.03
k 2
8000
P = s(1 + i)− n = 8000(1 + 0.03)−12 =
(1.03)12
Let y = (1.03)12
 log y = 12 log(1.03)
 log y = 12 × 0.01283 = 0.15396
 y = anti log(0.15396) = 1.4254
8000
Then,P = = 5612.45
1.4254
When compounded continuously
We have r =0.06, t=6, S = 8000
P = se − rt = 8000e −0.06 × 6 = 8000e −0.36 = `5581.4

Example 29: A trust fund is being set up by a single payment so that at the end of 20
years, there will be ` 50000 in the fund. If interest is compounded continuously
at an annual rate of 5%, how much money should be paid in to the fund initially?
Solution: We are given S = 50,000 ; r = 0.05; t = 20 then
P = se − rt = 50000e −0.05× 20 = 50000e −1 = 18393.9 = `18394 approx.

Example 30: A student is awarded a scholarship and two options are placed
before him:
1. To receive `1100 now or
2. Receive `100p.m at the end of each of next 12 months .
Which option be chosen if the rate of interest is 12% p.a?
Solution: Option I :Receive `1100 now.
Future value of `1100 now after 1 year = Prt = 1100× 0.12 × 1 = `1232
Option II: Receive `100p.m at the end of each of next 12 months.
It means that first instalment of `100 received at the end of first month
would fetch interest for 11 months, second instalment for 10 months and so
on. Last instalment would not fetch any interest.
Therefore, future value of all the 12 instalments at the end of one year =
Principal + interest
100(11 + 10 + 9 + 8 + 7 + 6 + 5 + 4 + 3 + 2 + 1 + 0)
= 100 × 12 +
12 × 100
= 1200 + 66 = `1266
Hence option II is better.
347 annuity Para 13.8

Exercise 13.4
Q1. Find the present value of ` 6000 due in 20 years at 5% compounded
semi- annually.
Q2. Find the present value of ` 4000 due in 6 years at 7% compounded semi-
annually.
Q3. What is the present value of ` 1000 due after 3 years from now if the
interest is compounded monthly at the rate of interest 9%?
Q4. Find the present value of ` 1000 due in 4 years at 7% compounded
annually.
Q5. What is the present value of ` 2500 due after 15 months from now if the
interest is compounded quarterly at the rate of interest 8%?
Q6. Find the present value of ` 500 due 10 years hence when interest of 10%
is compounded half yearly.
Q7. Find the present value of ` 500 due 10 years hence when interest of 10%
is compounded continuously.
Q8. How much should be invested at 6% per annum so that after 4 years the
amount will be ` 2500 when the interest is compounded (i) annually (ii)
quarterly (iii) monthly (iv) continuously.

Answers
A1. `2234.58
A2. ` 2647.13
A3. ` 764.15
A4. ` 762.89
A5. `2264.32
A6. ` 188.40
A7. `183.94
A8. (i) `1980 (ii) `1970 (iii) `1967.50 (iv) `1966.5

13.8 ANNUITY
Annuity: An annuity is a sequence of fixed equal payments made over uni-
form time intervals or at equal intervals of time. For example:
1. Loan taken by banks
2. Monthly deposit in a saving bank account to obtain a certain lump sum
amount in future.
Para 13.9 Mathematics of Finance 348

Payment period: The time period between successive annuity payments is

called payment period or payment interval.
Term of annuity: The time for the beginning of first payment to the end of last
period is called term of the annuity.
Periodic payment: The size of each instalment is called periodic rent or peri-
odic payment.
Types of annuities:
(i) Ordinary Annuity: It is the annuity in which the first payment is made
at the end of the first payment interval.
(ii) Annuity Due: It is the annuity in which the first payment is made at the
beginning of the first payment interval.
(iii) Annuity certain: It is an annuity whose payments extend over a fixed
period of time.
(iv) Contingent annuity: It is an annuity whose payments continue for a
period of time which depends on events whose dates of occurrence can
not be accurately foretold. For example: the premium on a life insurance
policy constitute such a annuity.
(v) Perpetuity: It is an annuity whose payments continue forever.
(vi) Deferred annuity: It is an annuity the first payment of which is postponed
until the expiration of a period of time equivalent to a certain number
of payment intervals.

13.9 AMOUNT OR FUTURE VALUE OF AN ORDINARY ANNUITY

Amount or future value of an annuity: It is the sum of the compound amounts
of all the payments accumulated at the end of the term.
Derivation of the formula of amount of an ordinary annuity:
Consider a sequence of n equal payments of ` R each made at the end of each
period at the rate of interest i per period. The first payment made at the end of
the first period will accrue interest for (n-1) periods, therefore its compound
amount would be R(1+i)n-1 . The second payment of ` R will accrue the interest
for (n-2) periods and the corresponding amount will be R(1+i)n-2 , the third for
(n-3) periods and so on. The last payment made at the end of the last payment
interval does not accrue interest at all. Therefore,
Amount S of this annuity = R + R (1 + i ) + R (1 + i )2 + .... + R (1 + i )n −1
This is a geometric series consisting of n terms with first term R and common
ratio 1+i.
 (1 + i )n − 1   (1 + i )n − 1   (1 + i )n − 1  sn i
Then S = R   = R   .Let us denote  by and
 (1 + i ) − 1  i 
   i 
349 Amount or future value of an ordinary annuity Para 13.9

is read as “s sub n at the rate i”. The symbol sn i represents the amount of an
ordinary annuity consisting of n payments of ` 1 each at the rate i per period.
Values of sn i ,for various n and i are given in table III. Thus the amount S
of an ordinary annuity consisting of n payments of ` R each at the rate i per
period is given by:

s = Rsn i where

sn i  (1 + i )n − 1 
=  
 i 
S = amount or future value of an ordinary annuity.
R = the size of each payment.
i = rate per period.
n=number of equal payments
In case of continuous compounding, the amount of an annuity in which R rupees
are paid each year for n years at the rate of interest r per annum is given by:
n

s = ∫ Re rt dt
0

where S =amount of annuity

R = size of each payment
r =rate of interest per annum.
n=number of payments.

Example 31: Find the amount of an annuity of ` 2000 payable at the end of each
year for 5 years if money is worth 8% effective.
r 0.08
Solution: We are given that R = 2000 ; n =5 ; i = =
k 1
Also, s = Rs i = 2000s 0.08 = 2000 × 5.8666010 Using table III
n 5

= ` 11733.202

Example 32: Harish deposits ` 1500 at the end of every month in his saving bank
account that pays interest @ 15% p.a compounded monthly. Find the amount
in his account at the end of 2 years.

r 0.15
Solution: We are given that R = 1500 ; n =2×12 = 24 ; i = = = 0.0125
k 12
Also, s = Rsn i = 1500s24 0.0125 = 1500 × 27.78808403 Using table III
= ` 41682.126
Para 13.9 Mathematics of Finance 350

Example 33: A man requires ` 20,00,000 to purchase a house after 5 years. He

has an opportunity to invest the funds in an account which can earn 6% p.a
compounded quarterly. Find how much must be deposited in each quarter so
as to have the required amount at the end of 5 years.
r 0.06
Solution: We are given that S = 20,00,000; n =5×4 = 20; i = = = 0.015
k 4
s 20,00,000 20,00,000
Also, s = Rsn i ⇒ R= = = Using table III
sn i s20 0.015 23.12366710
= ` 86491.47

Example 34: An account fetches interest at 5% p.a compounded continuously .

An individual deposits ` 1000 each year in the account. Find how much will
be the amount in the account after 5 years?
Solution: We are given that R=1000; n =5; r = 0.05
n 5
1000 0.05t 5
s = ∫ Re rt dt = ∫ 1000e 0.05t dt = e = 20000 e 0.25 − e 0 = ` 5680.50
0 0
0.05 0

Example35: A bank pays interest at the rate of 6% p.a compounded continuously.

Find how much should be deposited in the bank each year in order to accumulate
` 6000 in 3 years?
Solution: We are given that S=6000; n =3; r = 0.06
n 3

s = ∫ Re rt dt ⇒ 6000=∫ Re 0.06t dt
0 0

3
6000
⇒ = ∫ e 0.06t dt
R 0

6000 1 3
⇒ = e 0.06t
R 0.06 0

6000 × 0.06
⇒ = (e 0.18 − e 0 ) = 0.1972
R

6000 × 0.06
⇒R= = ` 1825.56
0.1972

Example: At six month intervals, A deposited `100 in a savings account which credit
interest at 10% per annum compounded semi – annually. The first deposit was
made when A’s son was six month old and the last deposit was made when his
son was 8 years old. The money remained in the account and was presented
to the son on his 10th birthday. How much did he receive?
351 Amount or future value of an ordinary annuity Para 13.9

Solution: Amount accumulated in the account when A’s son was 8 years old =
amount of an ordinary annuity consisting of 16 half yearly payments of `100
each at the rate of 0.05 per period. It is given by:
s = Rsn i = 100s16 0.05 = 100 × 23.6574
= `2365.74
Amount received by the son on his 10th birthday
4
 0.10 
= 2365.74 1 + = 2365.74(1.05)4 = `2875.57
 2 
Example: Mr X deposits in his son’s account ` 500 times his son’s age at the end
of each birthday. Find the balance accumulated at the tenth birthday, if the
rate of interest is 10% per annum compounded annually.
Solution: Amount accumulated at the tenth birthday =
S = 500(1.10)9 + 1000(1.10)8 + 1500(1.10)7 +........5000 ….(1)
s 5000
= 500(1.10)8 + 1000(1.10)7 + 1500(1.10)6 + ..... + …..(2)
1.10 1.10
Subtracting (2) from (1) we get
 1  5000
s 1 − = [500(1.10)9 + 500(1.10)8 + 500(1.10)7 + .....500] −
 1.10  1.10
 (1.10)10 − 1  5000
= 500  −
 1.10 − 1  1.10

5000
= 500[(1.10)10 − 1] −
1.10
s 5000
⇒ = 500[2.59374246 − 1] −
11 1.10
s
⇒ = 7968.71 − 4545.45 = 3423.26
11
 s = 11 × 3423.26 = ` 37,655.86

Example: A bond of face value of `10,000 is payable 10 years later. There is an

option to receive equal yearly instalments at the end of each year at 10% per
annum interest . Calculate what would be the instalment.
Solution: We are given that S = 10000; n=10; r=0.1
 (1.01)10 − 1   2.594 − 1 
s = Rsn i ⇒ 10000=R   = R
 0.1   0.1 


10000 × 0.1
R= =`627.35
1.594
Para 13.9 Mathematics of Finance 352

Exercise 13.5
Q1. Find the amount of an annuity of ` 500 payable at the end of each year
for 12 years if money is worth 6% effective.
Q2. Find the future value of the annuity consisting of payments of ` 600 at
the end of every 3 months for 3 years at the rate of 8% compounded
quarterly.
Q3. Find the amount of an annuity of ` 200 payable at the end of each month
for 3 years at the rate of 15% compounded monthly.
Q4. What will be the size of the each payment if you want to accumulate
`50,000 by making equal payments at the end of each quarter for the
next five years. It is given that money is worth 6% converted quarterly?
Q5. A bank pays interest @ 6% p.a compounded continuously. If a person
places ` 1000 in the bank each year, how much will be in his account
after 3 years?
Q6. Find the amount of an annuity of ` 500 payable at the end of each year
for 14 years if money is worth 5% effective.
Q7. At six month intervals, A deposited `2000 in a savings account which
credit interest at 10% per annum compounded semi – annually. The first
deposit was made when A’s son was six month old and the last deposit
was made when his son was 8 years old. The money remained in the
account and was presented to the son on his 10th birthday. How much
did he receive?
Q8. A bank pays interest at the rate of 6% p.a compounded quarterly. Find
how much should be deposited in the bank at the end of each quarter
for three years in order to accumulate ` 1500 in 3 years?
Q9. Find the future value of the annuity consisting of payments of ` 500 for
7 years at the rate of 14% compounded annually.
Q10. `200 is deposited in an account at the end of each month paying interest
@ 6% per year compounded monthly. Find the amount of annuity after
10th payment. Given that (1.005)10 = 1.05
Q11. On retirement a person wants to make a lumpsum investment paying
interest @ 8% compound annually in order to receive annually payments
of ` 10,000 at the end of each year for the following five years. How
much must they invest?

Answers
A1. ` 8434.97
A2. `8047.25
353 Amount or future value of an ordinary annuity Para 13.9

A3. `9023.10
A4. `2162.29
A5. `3286.67
A6. `9799.32
A7. `57511.65
A8. `115.01
A9. `5365.3571
A10. ` 2044.4
A11. `39908.1

13.9 PRESENT VALUE OF AN ORDINARY ANNUITY

Present value or capital value: Present value or capital value of an annuity is
the sum of the present values of all payments. In other words, it represents
the amount of money that must be invested now to purchase the payments
due in the future.
Derivation of the formula of Present value of an ordinary annuity:
Consider a sequence of n equal payments of ` R each made at the end of each
period at the rate of interest i per period.
The present value of the first payment = R(1+i)-1 .
The present value of second payment = R(1+i)-2
The present value of third payment = R(1+i)-3. .
.
.
.
.
.
The present value of the last payment = R(1+i)-n
Thus the present value P of the annuity = P = R (1 + i )−1 + R (1 + i )−2 + .... + R (1 + i )−n
This is a geometric series consisting of n terms with first term R(1+i)-1 and
common ratio (1+i)-1.
1 − (1 + i )−n  1 − (1 + i )−n  1 − (1 + i )−n 
Then P = R (1 + i )−1  −1 
= R   . Let us denote  
 1 − (1 + i )   i   i 
a a
by n i and is read as “a sub n at the rate i”. The symbol n i represents the
present value of an ordinary annuity consisting of n payments of ` 1 each at
the rate i per period. Values of a n i , for various n and i are given in table IV.
Para 13.9 Mathematics of Finance 354

Thus the present value P of an ordinary annuity consisting of n payments of

` R each at the rate i per period is given by:

P = Ra n i
where
−n
a n i = 1 − (1 + i) 
 
 i 
P = present value of an ordinary annuity.
R = the size of each payment.
i = rate per period.
n=number of equal payments
In case of continuous compounding, the present value of an annuity in which
R rupees are paid each year for n years at the rate of interest r per annum is
given by:
n

P = ∫ Re − rt dt
0

where P = present value of annuity

R = size of each payment
r =rate of interest per annum.
n=number of payments.

Example: Find the present value of an annuity of ` 800 payable at the end of each
6 months for 5 years, if money is worth 6% converted semi-annually.
r 0.06
Solution: We are given that R = 800; k = 2; n = 5× 2 =10; i = = = 0.03
k 2
P = Ra n i = 800a10 0.03 = 800 × 8.53020284 = ` 6824.16

Example: A man took a loan of ` 5,00,000 to purchase a flat. He pays an equal

instalment for 20 years @ 10% on outstanding balance. Find the amount of
instalment. Given that a 20 0.10 = 8.51356
Solution: This is a case of present value of annuity. We are given that P = `
r 0.10
5,00,000; k = 1; n = 20; i = = = 0.10
k 1
P
P = Ra n i ⇒ R=
an i

P 500000 500000
⇒ R=
8.51356 `58729.8
= = =
an i a 20 0.10
355 Amount or future value of an ordinary annuity Para 13.9

Example: What is the present value of a continuous income stream of ` 3500 per
year for four years at the rate of interest of 5% p.a compounded continuously?
Solution: We are given that R= 3500; n = 4; r = 0.05
n 4

P = ∫ Re − rt dt = ∫ 3500 e −0.05t dt
0 0

−3500 −0.05t 4
⇒ e
0.05 0

⇒ −70000 e −0.2 − e 0 

⇒ -70000[0.81873 - 1] = 12688.9

Example: What is the present value of a continuous income stream of ` 5000

per year for three years of interest if it is discounted continuously at the rate
of 6% per year?
Solution: We are given that R= 5000; n =3; r = 0.06
n 3

P = ∫ Re − rt dt = ∫ 5000 e −0.06t dt
0 0

−5000 −0.06t 3 ⇒ −83333.3 e −0.18 − 1 = `13727.476

⇒ e
0.06 0

Example: A two wheeler is purchased on instalment basis such that ` 1800 is to

be paid each year for 5 years. If interest is charged @ 11% p.a compounded
continuously, what would be the cash price or present value of the two – wheeler?
Solution: We are given that R= 1800; n =5; r = 0.11
n 5

P = ∫ Re − rt dt = ∫ 1800 e −0.11t dt
0 0

−1800 −0.11t 5
⇒ e ⇒ −16363.64 e −0.55 − 1 = ` 6922.64
0.11 0

Example: A person sells his old car for ` 1,00,000 to buy a new car for ` 2,50,000.
He pays ` x in cash and the balance in 18 instalments of ` 7000 at the end of
each month. If interest be reckoned at 6% p.a compounded monthly, find the
value of x.
Solution: Balance amount required for the new car = 2,50,000 – 1,00,000 = `
1,50,000
r 0.06
i= = = 0.005
k 12
According to the given information,
Para 13.9 Mathematics of Finance 356

1,50,000 = x + 7000 a18 0.005

1,50,000 = x + 7000 × 17.1726802
 x = 29790.62
Example: Mr. X sells his old car for ` 1,00,000 to buy a new one costing ` 2,58,000.
He pays `x cash and balance by payments of ` 7000 at the end of each month
for 18 months. If the rate of interest is 9% compounded monthly, find x . Given
that (1.0075)-18 = 0.8741566
Solution: Balance amount required for the new car = 2,58,000 – 1,00,000 = `
1,58,000
r 0.09
i= = = 0.0075
k 12
According to the given information,
1,58, 000 = x + 7000 a18 0.0075

1 − (1 + i)− n 
1,58,000 = x + 7000  
 i 
1 − (1.0075)−18 
1,58,000 = x + 7000  
 0.0075 
1 − 0.8741566 
⇒ 1,50,000 = x + 7000 
 0.0075 

1,50,000 = x + 117454
 x = ` 40,546

Example: What would be the monthly sales volume of a company if it desires to

earn a 12% annual return convertible monthly on its investment of ` 2,00,000?
Monthly costs are `3000. The investment will have eight year life with no scrap
value.
Solution: Let the monthly sales volume of a company be ` x.
r 0.12
We are given that P = 2,00,000, k =12, n= 8×12 = 96, i = = = 0.01
k 12
Then x is given by
2,00,000 = (x − 3000 ) a96 0.01

⇒ 2,00,000 = (x − 3000 ) (61.52770299)

200000
⇒ (x − 3000 ) = = 3250.57
61.52770299
⇒ x = 3000 + 3250.57 = ` 6250.57
357 Amount or future value of an ordinary annuity Para 13.9

Example: You have just won million rupees, the prize is awarded in 10 annual
payments of ` 1,00,000 each. Annual payments are received at the end of each
year. You are given the option of receiving a single lump–sum payment of `
6,00,000 instead of the million rupees annuity. You want to find out which
option is more in today’s rupees. Money is worth 10% compounded annually.
Solution: We first find the present value of an annuity of 10 annual payments
of ` 1,00,000 each at the rate of 10% p.a .
P = Ra n i = 100000a10 0.10 = 10000 × 6.145 = 614500
It is more than a single lump–sum payment of ` 6,00,000. Therefore, option of
10 annual payments of ` 1,00,000 each is better.

Example: Mr. X purchases a house for `2,00,000. He agrees to pay for the house in
5 equal instalments at the end of each year. If money is worth 5% p.a effective,
what would be the size of each instalment? In case X makes a down payment
of ` 50,000 what would be the size of each instalment?
r 0.05
Solution: We are given that P= 200000 ; n =5; r = 0.05, k = 1, i = = = 0.05
k 1
P
P = Ra n i ⇒ R=
an i
P 200000 200000
⇒ R=
4.32947667 `446194.95 approx
= = =
an i a 5 0.05

If X makes a down payment of ` 50,000 then the outstanding amount is =

2,00,000 – 50,000 = 1,50,000
P 1,50,000 150000
Then R= = = = ` 34646.22 approx
an i a 5 0.05 4.32947667

Example: According to the will of a man , his Life Insurance of ` 40,000 should be
deposited in a bank soon after his death. The bank has to pay ` 5000 annually
to his heir and if the interest is 5% p.a compounded continuously how many
annual payments could be made?
Solution: Let n denotes the number of annual payments.
n
Then P = ∫ Re − rt dt
0
n

⇒ 40,000 = ∫ 5000e −0.05t dt

0

−5000 −0.05t n
⇒ 40,000 = e
0.05 0

⇒ 40,000 = −100000 e −0.05n − 1

⇒ −0.4 = e −0.05n − 1
Para 13.9 Mathematics of Finance 358

⇒ e −0.05n = 0.6
 - 0.05n log e = log(0.6)
 -0.05n(0.4343) = -0.2218
 n = 10.21 ?? 10 years

Example: According to an investment proposal, an initial investment of ` 1,00,000

is expected to yield a uniform income stream of ` 10,000 per annum. If money is
worth 8% per annum compounded continuously, what is the expected payback
period, i.e., after what time, the initial investment will be recovered?
Solution: Let the initial investment will be recovered after n years. Then,
n

P = ∫ Re − rt dt
0
n

⇒ 1,00,000 = ∫ 10,000e −0.08t dt

0
−10000 −0.08t n
⇒ 1,00,000 = e
0.08 0

⇒ 1,00,000 = 125000 1 − e −0.08n 

⇒ 0.8 = 1 − e −0.08n
⇒ e −0.08n = 0.2
 -0.08n log e = log(0.2)
 -0.08n(0.4343) = -0.6990
 n = 20.12 ?? 20 years

Example: A company wishes to invest 10,000 in a machine that will yield an

income stream of `1200 per year for the next 8 years. If money is worth 8%
p.a effective, find whether the investment is worthwhile.

Solution: This the case of finding the present value of an income stream of `1200
per year for 8 years @8% p.a.
r 0.08
We are given that R = 1200; k = 1; n = 8; i = = = 0.08
k 1
P = Ra n i = 1200a 8 0.08 = 1200 × 5.7466 = ` 6895.92

Example: A person desires to create an endowment fund to provide for a prize

of ` 5000 per year. If the fund can be invested at 12% per annum compounded
continuously, find the amount of endowment.
[B. Com(H)D.U 2011]
Solution: This is the case of present value of annuity of ` 5000 invested at 12%
per annum compounded continuously. It is given by:
359 Amount or future value of an ordinary annuity Para 13.9

m
−5000 −0.12t
∞

P = ∫ Re − rt dt = ∫ 5000 e −0.12t dt =
∞
e
0 0
0.12 0

= −41666.67(e −∞ − 1)
= ` 41666.67
Example: Mr. X bought a house paying ` 5,00,000 down and promise to pay
` 20,000 in each quarter for next 10 years. The vendor charges interest at the
rate of 6% p.a. compounded quarterly.
(i) Determine the cost of the house.
(ii) If X missed the first 12 payments, what must he pay at the time the 13th
is due to bring him up to date.
(iii) After making 8 payments, he wishes to discharge his remaining
indebtness by a single payment at the time when 9th regular payment
was due. What must he pay in addition to regular payment?
(iv) If X missed the first 10 payments, what must he pay when the 11th
payment is due to discharge his entire indebtness?
Solution:
(i) Cost of the house = cash down payment + present value of ordinary
annuity of ` 20,000 each for 10 years at the rate of 6% p.a. compounded
quarterly
Therefore, Cost of the house = 5,00,000 + 20,000a 40 0.015
= 5,00,000 + 20,000(29.91584520)
= 5,00,000 + 598316.90
= ` 10,98,316.90
(ii) If X missed the first 12 payments, then the amount he must pay at the
time when the 13th payment is due can be thought of as future value of
ordinary annuity of 13 payments of ` 20,000 each paid at the end of each
quarter reckoning interest at the rate of 6% p.a. compounded quarterly.
It is given by:
20,000s13 0.015 = 20,000(14.23682960) = ` 2,84,736.59

(iii) After making 8 payments, the number of remaining instalments = 40 – 8
= 32. Out of these 32 instalments, one instalments is the 9th instalment
itself and the remaining 31 instalments can be treated as present value
of ordinary annuity of 31 payments of ` 20,000 each paid at the end
of each quarter reckoning interest at the rate of 6% p.a. compounded
quarterly. Therefore the amount he must pay to discharge his remaining
indebtness by a single payment at the time when 9th regular payment
was due is given by:
20000 + 20,000s31 0.015 = 20000 + 20,000(24.64614582) = `5,12,922.92

Para 13.9 Mathematics of Finance 360

(iv) If X missed the first 10 payments, the amount he must pay when
the 11 th payment is due to discharge his entire indebtness =
20,000s11 0.015 + 20,000a 29 0.015

= 20,000(11.86326249) + 20,000(23.37607558) = `7,04,786.51

Exercise 13.9
Q.1 Find the present value of annuity of `10000 payable at the end of each
year for 8 years if money is worth 8% effective.
Q2. Find the present value of annuity of `500 payable at the end of each
year for 8 years if money is worth 5% effective.
Q3. Find the present value of annuity of `400 payable at the end of each
month for 7 years if money is worth 6% converted monthly.
Q4. X buys a piece of land priced at `5,00,000 for which he agrees to make
equal payments at the end of each year for 10 years. If money is worth
5% effective, what is the size of these annual payments?
Q5. Find the present value of annuity of `100 per annum assumed to be
payable continuously for 10 years, at the rate of interest of 4% p.a
compounded continuously.
Q6. An equipment is purchased on an instalment basis such that ` 5000
is to be paid on signing of the contract and four yearly instalments of
` 3000 each payable at the end of first, second , third and the fourth year.
If interest is charged at 5% p.a., what would be the cash down price?
Q7. A purchased a television paying ` 5000 down and promising to pay `200
every three months for next 4 years. The seller charges interest at 8%
per annum compounded quarterly.
(i) What is the cash price of the television?
(ii) if A missed the first three payments, what must he pay at the time
the fourth payment is due to bring him up to date?
Q8. Shares in the mining company are expected to produce dividends of
` 0, 30, 24, 16 and 8 in the present and in the four following years and
too be worth nothing thereafter. If the interest is added once yearly at
5%, find the present value of the holdings.
Q9. What is the present value of a continuous stream of `3000 per year for
two years if it is discounted continuously at the rate of 0.06 per year?
Q10. M purchased a television paying ` 5000 down and promising to pay `200
every quarter for next 10 years. The seller charges interest at 12% per
annum compounded quarterly. If M missed the first ten payments, what
must he pay when the eleventh payment is due to discharge the entire
loan?
361 Amount or future value of an ordinary annuity Para 13.9

Q11. Mohan has first purchased a house for `7,00,000 and has made a down
payment of `1,50,000. He proposes to repay the balance in 25 years
by monthly instalments at 9% p.a compounded monthly. What are the
monthly payments? What is the total interest payment?
Q12. Calculate the present value of annuity of `30,000 per annum assumed
to be payable continuously for 10 years, at the rate of interest of 8% p.a
compounded continuously.
Q13. Deduce that a/r is the present value of an income stream of ` a per year
forever, interest being 100r% p.a compounded continuously.
Q14. An equipment is purchased for ` 30,000 down and payments of ` 2500
at the end of every six months for 6 years. If the interest is reckoned at
8% compounded semi – annually, find the cash price of the equipment.
Q15. What is the present value of a continuous income stream of ` 1000 per
year for three years of interest if it is discounted continuously at the
rate of 4% per year?
Q16. A machine is purchased on instalment basis such that `20,000 is to be
paid as cash down payments and balance is paid in 10 yearly equal
instalments of ` 2000 each, the first to be paid one year after the date
of purchase. If compound interest is charged @6% p.a what is the price
of the machine?
Q17. What should be the monthly sales volume of a company if it desires
to earn a 12% annual return convertible monthly on its investment of
`2,00,000? Monthly costs are `3000. The investment will have eight year
life with no scrap value.
Q18. A loan of `10,000 is to be repaid in 30 equal annual instalments of ` p
each. Find p if the compound interest is charged @ 4% p.a . Given (1.04)30
= 3.2434
Q19. On retirement, a person wants to make a lumpsum investment paying
interest @ 8% compound annually in order to receive annuity payments
of `10,000 at the end of each year for the following five years. How much
must they invest?
Q20. Ram bought a washing machine worth ` 13,000. He makes a down
payment of ` 3000 and agrees to make equal annual payment for four
years. If interest on outstanding balance is 14% compounded yearly, find
the amount of each instalment.

Answers
A1. `39927.10
A2. `3231.61
A3. `27,381.22
Para 13.15 Mathematics of Finance 362

A4. `64,752.30
A5. `824.20
A6. `15637.85
A7 (i) `7715.54 (ii) `824.32
A8. P = 0 + 30(1.05)−1 + 24(1.05)−2 + 16(1.05)−3 + 8(1.05)−4 = 70.74
A9. ` 5655
A10. `6399.26
A11. (i) `4615.58 (ii) `834674
A12. `206501.54
A14. `53,462.68
A15. ` 2827
A16. `34710
A17. `6250 approx
A18. `578.87
A19. `39908.1
A20. `3432.0505

13.15 AMORTIZATION OF LOANS

Amortization of loan: A loan is said to be amortized if it can be discharged by
a sequence of equal payments made over equal periods of time. Each payment
consists of interest on the outstanding loan plus repayment of part of the loan.
Formulas of Amortization:

P Pi
Periodic payment = R= =
a n i 1 − (1 + i)− n
1 − (1 + i)− (n − k +1) 
Principal outstanding at the beginning of kth period = Ra n − k +1 i = R  
 i 
Interest in k payment =
th Ra n − k +1 i
× i

Principal contained in the kth payment = R − Ra n − k +1 i × i

Total interest paid = nR – P
where P=amount of the loan
R= size of equal payment
i=rate per period.
n= number of equal payments
363 amortization of loans Para 13.15

Example: Mr. X took a loan of ` 5000 from Standard Chartered Bank. The bank
charges interest at the nominal rate of 12% compounded monthly. The loan is
amortized by equal payments to be paid at the end of each month for 3 months.
Find the size of the monthly payment and prepare the amortization schedule.

r 0.12
Solution: We are given that P = 5000 ; n=3; r = 0.12; i = = = 0.01
k 12
P 5000 50000
Monthly payment = R= = = = 1700.11
a n i a 3 0.01 2.940985
Amortization Schedule
Payment Principal Interest @1% Periodic Principal
interval outstanding at due at the end payment at repaid at
the beginning of the payment the end of the end of
of payment interval (`) payment payment
interval(`) interval (`) interval (`)
1 5000 50 1700.11 1650.11
2 3349.89 33.50 1700.11 1666.61
3 1683.38 16.83 1700.11 1683.28
Total 100.33 1700.11 5000

Example: A loan of ` 50,000 is to be repaid by equal annual instalments of principal

and interest over a period of 5 years. If the rate of interest is 8% p.a effective, find:
(i) The annual instalment
(ii) The principal outstanding at beginning of third year
(iii) Interest in third payment
(iv) principal contained in third payment
(v) total interest paid
r 0.08
Solution: We are given that P = 50,000; n=5; r = 0.08; i = = = 0.08
k 1
P 50000 50000
Annual instalment = R= a = a =
3.99271004
= 12522.82
ni 5 0.08

Therefore the annual instalment = `12522.82

(ii) The principal outstanding at beginning of third year
= Ra n − 3+1 i = 12522.82a3 0.08 = 12522.82 × 2.57709699 = `32,272.52
(iii) Interest in third payment
= Ra n − 3+1 i × i = 12522.82a 3 0.08 × 0.08 = 32272.52 × 0.08 = 2581.80
(iv) principal contained in third payment
= R − Ra n − 3+1 i × i = 12522.82 − 2581.80 = 9941.02
Para 13.15 Mathematics of Finance 364

(v) total interest paid = nR − P = 5 × 12522.82 − 50000 = `12614.1

Example: A person amortizes a loan of ` 1,50,000 for a new home by obtaining a

10 year mortgage at the rate of 12% compounded monthly. Find (i) the monthly
payment (ii) total interest paid (iii) The principal outstanding after 5 years.
Solution: We are given that P = 1,50,000 ; n=10 ×12 =120; r = 0.12;
r 0.12
i= = = 0.01
k 12
P 150000 150000
Monthly payment = R = = = = 2152.42
an i a 120 0.01 69.6891
We have evaluated a120 0.01 as follows
1 − (1 + i )−n 1 − (1.01)−120 1 − 0.303109
a120 0.01 = = = = 69.6891
i 0.01 0.01
where (1.01)-120 has been evaluated as follows:
Let y = (1.01)-120 . Take log on both sides we get,
log y = -120log(1.01) = -120 × (0.00432) = -0.5184
log y = -0.5184 + 1 - 1 = 1.4816
y = anti log(1.4816) = 0.303109
(ii) Total interest paid = nR - P = 120 × 2152.42 - 1,50,000 = 108290.4
(iii) The principal outstanding after 5 years means after 60th instalment i.e.
at the beginning of 61st instalment =
Ra n − k +1 i = Ra120 − 61+1 0.01 = 2152.42a 60 0.01 = 2152.42 × 44.95503841 = ` 96762.12

Example: A couple wishes to purchase a house for ` 12,00,000 with a down payment
of `2,50,000. If they can amortize the balance at 9% p.a compounded monthly
for 20 years, what is their monthly payment? What is the total interest paid?
What is their equity after 10 years?
Solution: We are given that P =12,00,000 – 2,50,000 = 9,50,000; n=20 ×12 =240;
r = 0.09;
r 0.09
i= = = 0.0075
k 12
P 9,50,000 950000
Monthly payment = R= = = = `8547.40
an i a 240 0.0075 111.1449
Total interest paid = nR - P = 240 × 8547.40 - 950000 = `1101376.177
After 10 years, we are at the beginning of 121st period.
365 amortization of loans Para 13.15

Therefore, principal outstanding at the beginning of 121st period

= Ra n − k +1 i = 8547.40a 240 −121+1 0.0075 = 8547.40 × a120 0.0075 = (8547.40)(78.9416)
= `674745.4318
Therefore equity after 10 years = down payment + amount paid on loan
= 2,50,000+(9,50,000- 674745.4318) = `525254.57
Example: A loan of ` 10,000 is to be repaid by equal annual instalments of
principal and interest over a period of 20 years. The rate of interest is 3% p.a
effective. Find:
(i) The annual instalment
(ii) The capital contained in 8th instalment
(iii) the principal repaid after 12 instalments have been paid.
Solution: We are given that P =10000; n=20; r = 0.03;
P 10,000 10000
(i) The annual instalment = R= = = = ` 672.16
an i a 20 0.03 14.87747486
(ii) The capital contained in 8th instalment
= R − Ra 20 − 8+1 0.03 × 0.03 = R(1 − a 20 − 8+1 0.03 × 0.03) = 672.16(1 − 0.03 × a13 0.03 )
= 672.16(1-0.03 × 10.63495533)= `457.71
(iii) The principal repaid after 12 instalments have been paid =
=loan amount – principal outstanding at the beginning of 13th payment
= 10000 − Ra 20 −13+1 i = 10000 − 672.16 × a 8 0.03

= 10000 − 672.16 × 7.01969219 = `5281.64

Example:Mr. M borrowed `10,00,000 from a bank to purchase a house and decided

to repay by monthly equal instalments in 10 years. The bank charges interest
at 9% compounded monthly. The bank calculated his EMI as `12,688. Find the
principal and interest paid in 1st and second year.
Given : (1.0075)−120 = 0.4079386,(1.0075)−108 = 0.4462063,(1.0075)−96 = 0.4880631
a108 0.0075 = 73.83916,a 96 0.0075 = 68.258253
Solution: Principal outstanding after one year (i.e., 12 payments) =Present value
of remaining 108 payments
= Ra n i = 12668a108 0.0075 = 12688 × 73.83916

= `9,35,395
Then principal paid during first year = 10,00,000 – 9,35,395 = ` 64,605
Interest paid during first year = 12× 12688 – 64605 = ` 87,411
Para 13.15 Mathematics of Finance 366

Principal outstanding after second year = Present value of remaining 96 pay-

ments
= Ra n i = 12668a 96 0.0075 = 12688 × 68.258253

= `8,64,696
Then principal paid during second year = 10,00,000 –864696-64605= ` 70699
Therefore, Interest paid during second year = 12688 × 12 = ` 81,317

Example: Mrs. S took a housing loan of ` 8,00,000 to be paid in 10 years by equal

monthly instalments. The interest charged is 10.5% compounded monthly.
Find her monthly payments. After 2 years, the bank revised the interest rate
to 12% compounded monthly. Find the new EMI, if the loan is to be cleared
by the stipulated time.
Given : (1.00875)−120 = 0.3515416,(1.00875)−96 = 0.4332927,(1.01)−96 = 0.3847234

a120 0.00875 = 74.109531,a 96 0.00875 = 64.766548,a 96 0.01 = 61.52766

[B.Com(H)D.U 2010]
Solution: We are given that P = 8,00,000; n=10 ×12 =120; r = 0.105;
r 0.105
i=
= = 0.00875
k 12
P 8,00,000 800000
Monthly payment = R= = = = ` 10,795
a n i a120 0.00875 74.109531
Principal outstanding after two years =Present value of remaining 96 payments
= Ra n i = 10795 × a 96 0.00875 = 10795 × 64.766548

= `699155
Let x be the size of monthly instalment. Then x is given by:
699155 = xa 96 0.01 = x(61.52766)
699155
⇒x= = ` 11,363
61.52766

Exercise 13.10
Q1. A loan of ` 30,000 at the rate of interest of 6% compounded annually, is
to be amortized by equal payments at the end of each year for 5 years.
Find:
(i) The annual instalment
(ii) The principal outstanding at beginning of fourth year
(iii) Interest in fourth payment
367 amortization of loans Para 13.15

(iv) principal contained in fourth payment

(v) total interest paid
Q2. A couple wishes to purchase a house for ` 10,00,000 with a down payment
of `2,00,000. If they can amortize the balance at 9% p.a compounded
monthly for 25 years, what is their monthly payment? What is the total
interest paid? What is their equity after 5 years?
Q3. Niranjan Das and co. purchased a flat for ` 150000 that is to be amortized
over 10 years at 12% p.a compounded yearly. Find the yearly instalment.
Q4. Find the amortized monthly payment necessary to pay off a house loan
of `150000 at 12% p.a in 10 years. Further find the amount of loan paid
after the payment of 60 instalments.
Q5. Ram purchased a flat at a cost of ` 3,50,000 and made a 30% down
payment. The balance is amortized at a rate of interest of 12% p.a for
15 years. Find the monthly instalment for repayment of loan.
Q6. Mohan has first purchased a house for ` 7,00,000 and has made a down
payment of `1,50,000. He proposes to repay the balance in 25 years by
monthly instalments at 9%. What are the monthly payments? What is
the total interest paid?

Answers
A1 (i) `7121.89 (ii) `13057.22 (iii) `783.43 (iv) `6338.46 (v) 5609.45
A2. (i) `6713.57 (ii) `1214071 (iii) ` 253820.93
A3. `26548.6
A4. `53253.16
A5. `2940.4119
A6. `4615.58, ` 834674