Module 1.

Mark Twain- There are three kinds of lies: lies, damned lies, and statistics.
Aaron Levenstein- Statistics are like bikinis. What they reveal is suggestive, but what they conceal is
vital.
“One cannot go about without statistics”
Florence Nightingale – The one science essential to all political and social administration, all education,
all organization based on experience, for it only gives results of our experience.
- To understand god’s thoughts, we must study statistics, for these are the measures
of his purpose.

Definition of statistics
Plural sense: numerical facts, e.g. CPI, peso-dollar exchange rate
Singular sense: Scientific discipline consisting of theory and methods for processing numerical
information that one can use when making decisions in the face of uncertainty.

Two areas of Statistics

Statistics aims to uncover structure in data, to explain variation.

- Descriptive
- Inferential

Descriptive Statistics

methods concerned w/ collecting, describing, and analyzing a set of data without drawing
conclusions or inferences about a large ground.
used to describe a set of data in terms of its frequency of occurrence, its central tendency, and its
dispersion.

Inferential Statistics

methods concerned with the analysis of a subset of data leading to predictions or inferences about the
entire set of data.

it addresses the problem of making broader generalizations of inferences from sample data to
population.

Population – It is the totally of all the elements or entities from which the information are obtained.
Sample – It’s the finite number of objects selected from the population. It is a subset of a population.

Parameter - any numerical measure or value that describes a characteristic or an aspect of a population.

Statistic - any numerical measure or value that describes a characteristic or an aspect of a sample.

Census - a process of collecting information from the population. It also refers to an official count by a
national government of the country’s population.

ex. Governments use census information for public policies such as fund allocations for schools
and road constructions.

Survey - a process of collecting information from a sample.

ex. Generally conducted when the population is too large and getting information from the whole
population is costly and time-consuming task.

Types of Variables

Variable- any characteristic or information measurable or observable in every element of the population
or sample.

Qualitative(Categorical)
- a variable that indicates what kind of a characteristic an individual, object, or event possesses.
ex. color of cars, juice, favorite basketball team, economic status, student number.

Quantitative variable
- a variable that indicates how much or how many of a characteristic an individual, object, or event
possesses.
ex. volume, temperature, student grade, score in a quiz, height.

Discrete variable
- a quantitative variable that can assume only countable number of distinct values such as 0, 1, 2, 3, …
ex. Number of students in a class, age as used in insurance, point-grade

Continuous variable
- a variable that can assume infinitely many values corresponding to the points on a line interval.
ex. weight, area, time, temperature

Levels of measurement
- Nominal
- Ordinal
- Interval
- Ratio

Nominal Level
 - Characterized by data that consists of names, labels, or categories only. The data cannot be
arranged in an ordering scheme.
ex. Gender, civil status, blood type, food preferences, etc.

Ordinal Level
- involves data that may be arranged in some order, but differences between data values either
cannot be determined or are meaningless.
ex. Nutrition status; level of consciousness; nurses’ rank

Interval Level
- like the ordinal level, with the additional property that meaningful amounts of differences
between data can be determined. However, there are no inherent (natural) zero starting point.
ex. Body temperature, year(1955, 1843, 1776, 1123, etc.)

Ratio Level
- The interval modified to include the inherent zero starting point. For values at this level,
differences and ratios are meaningful.
ex. Participants’ age, height, weight, fluid intake, etc.

-Data collection-
primary data collection methods
- collected from the first-hand experience and is not used in the past.
- Statistical methods, surveys, polls, interview, Delphi technique, Focus Groups.

secondary data collection methods

- data that has been used in the past. The researcher can obtain data from the sources both
internal and external to the organization.
- Financial reports, sales reports, government reports, mission, vision statement, internet.

Kind of primary data - statistical methods

Time series Analysis

- a sequential order of values of a variable, known as a trend, at equal time intervals. Using
trends, an organization can predict the demand for its products and services for the projected time.

smoothing techniques
- in cases where the time series lacks significant trends, smoothing techniques can be used. To
eliminate a random from the historical demand. This helps in identifying patterns and demand levels that
can be used to estimate future demand. Simple moving average method and weighted moving average
method.

Barometric method
- leading indicators approach, used to speculate future trends based on current developments.
When past event is considered to predict the future event, the past event would act as a leading indicator.
Surveys
- used to data from the target audience and gather insights into their preferences, opinions,
choices and feedback related to their products and services.

Polls
- comprise of one single or multiple-choice question.

Interviews
- ask questions either face-to-face or through telephone to the respondents.

Delphi Technique
- market experts are provided with the estimates and assumptions of forecasts made by other
experts in the industry.

Focus Groups
- A small group of people, around 8-10 members come together to discuss the common areas of
the problem.

Questionnaire
-Printed set of questions, either open- ended or closed-ended, which the respondents are
required to answer on the basis of their knowledge and experience and experience with the issue
concerned.

Measures of Central Tendency

- A single value that is used to identify the “center” of the data
- it is thought of as a typical value of the distribution
- precise yet simple
- most representative value of the data
Mean
- most common measure of the center
- also known as arithmetic average

use the mean when:

- sampling stability is desired
- other measures are to be computed

properties of the mean

- may not be an actual observation in the data set

- can be applied in at least interval level
- easy to compute
- every observation contributes to the value of the mean
-subgroup means can be combined to come up with a group mean (use weighted mean)
- easily affected by extreme values

Median

- Divides the observations into two equal parts

- Sample median denoted as while population median is denoted as

use the median when:

- the exact midpoint of the distribution is desired
- there are extreme observations

properties of the median

- may not be an actual observation in the data set

- can be applied in at least ordinal level
- a position measure; not affected by extreme values

Mode

-occurs most frequently

- nominal average
- may or may not exist

use the mode when:

- when the “typical” value is desired

- when the dataset is measured on a nominal scale

Properties of a mode

- can be used for qualitative as well as quantitative data

- may not be unique
- not affected by extreme values
- can be computed for ungrouped and grouped data

Measures of Location
- summarizes a data set by giving a value within the range of the data values that describes
its location relative to the entire data set arranged according to magnitude(called an array).
 - some common measures:
- minimum, maximum
- percentiles, deciles, quartiles

Quantiles

Minimum – the smallest value in the data set, denoted as MIN.

Maximum – the largest value in the data set, denoted as MAX.
Percentiles – Numerical measures that give the relative position of a data value relative to the
entire data set.
Deciles – divide an array into ten equal parts, each part having ten percent of the distribution of
the values denoted by Dj.
Quartiles- Divide an array into four parts, each part having 25% of the distribution of the data
values, denoted by Qj.

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