NAME -

PROGRAM- MASTER OF BUSINESS ADMINISTRATION (MBA)

SEMESTER- 1st
COURSE CODE & NAME- DMBA109 STATISTIC FOR
MANAGEMENT
SESSION- JULY - AUGUST 2024

ASSIGNMENT SET-1

Q.1. What are the function and limitations of Statistics?

Ans. The word 'Statistics' is derived from Latin word 'Status',
German word 'Statistic', Italian word 'Statista', French word
'Statist Tique' each of which means political state. In those days
"Statistics" was used only in collecting the information relating to
the population of the state military strength, incomes etc. for
framing the military and the fiscal policies. So, at that time,
"Statistics" was considered only as the science of statecraft.
However with passage of time, the science of statistics has
been applied very widely. So, in modern times, the scope of
statistics has considerably enlarged. It is used not only to the
state in administration but it is used in Economics, Science,
Business, Research, Bank etc. There is hardly any place of human
activity where statistics has not been used.
The word "Statistics" is used in singular as well as plural sense. In
the plural sense, it means the quantitative information or
numerical facts collected systematically. As for example:
Statistics of population, national incomes, unemployment,
poverty, exports, imports etc. in the singular sense, it means the
various methods and techniques adopted for the collection,
presentation, analysis and the interpretation of the figures. But to
a layman, it is simply a mass of figures.
Functions and limitations of statistics
Explanation:
Here is the Some Functions of statistics-
 statistics helps in presenting statistical facts and figures in
definite and concise form , so that further studies can be
conducted.
 since facts are presented in a format so it helps us in making
comparison easy.
 based on the statistical data we can do forecasting and
make the desired policies.
Limitations of statistics-
 Statistics recognizes only numerical data, so qualitative
data which is very important in taking decisions are ignored.
 statistics deals with aggregate of facts and hence it ignores
individual data.
 statistics may be misused by some people.
 Statistical methods are best applicable to quantitative data.
 Statistics cannot be applied to heterogeneous data.
 If sufficient care is not exercised in collecting, analysing and
interpreting the data, statistical results might be misleading.
  Only a person who has an expert knowledge of statistics
can handle statistical data efficiently.
 Some errors are possible in statistical decisions. In
particular, inferential statistics involves certain errors. We
do not know whether an error has been committed or not.
Statistical conclusions are claims made based on the strength of
statistical results. Threats to the validity of statistical conclusions
include: low statistical power, experiment-wise error, violating
the assumptions of statistical tests, omitted-variable bias, and
over- or under-interpretation of results.

Q.2. A clerk calculated arithmetic mean of 50 values as

39.2. However, it was found that instead of taking two values as
25 and 32, he took them as 52 and 23. Find the corrected
arithmetic mean.
Ans. Here is the correction step by step:-
Step 1: Calculate the incorrect sum
The initial incorrect arithmetic mean is given as 39.2, and there
are 50 values. So, the incorrect total sum of the values is:
Incorrect sum=39.2×50=1960\text{Incorrect sum} = 39.2 \times
50 = 1960Incorrect sum=39.2×50=1960
Step 2: Correct the sum by adjusting for the swapped values
The error occurred because two values (25 and 32) were
mistakenly swapped with 52 and 23. We need to adjust the sum
by removing the incorrect values (52 and 23) and adding the
correct ones (25 and 32):
Corrected sum=1960−52−23+25+32{Corrected sum} = 1960 - 52 -
23 + 25 + 32Corrected sum=1960−52−23+25+32
Breaking it down:
1960−52−23=18851960 - 52 - 23 = 18851960−52−23=1885
1885+25+32=19421885 + 25 + 32 = 19421885+25+32=1942
So, the corrected sum is 1942.
Step 3: Calculate the corrected arithmetic mean
The number of values remains 50. Therefore, the corrected
arithmetic mean is:
Corrected mean=194250=38.84{Corrected mean} = {1942}{50} =
38.84Corrected mean=501942=38.84
Thus, the corrected arithmetic mean is indeed 38.84
{38.84}38.84.

Q.3. Define Following Term:

 Mutually exclusive Events
 Independent even
Ans. Here is the define following term:-
An event is an outcome or a combination of outcomes of an
experiment. Suppose we throw a die. Let E be the event of a
perfect square number, then E = {1, 4} is the answer. Whenever an
outcome satisfies the conditions given in the event, we say that
the event has occurred.
The definition of mutually exclusive events can also be extended
to more than two events. More than two events are mutually
exclusive if the happening of one of these rules out the happening
of all other events. The events A = {1, 2}, B = {3} and C = {6} are
mutually exclusive in connection with the experiment of throwing
a single die. In this section, we will study what are mutually
exclusive events in probability.
There are different types of events in probability we deal with.
Some of them are given below:
 Simple Event
 Compound Event
 Null Event
 Sure Event or Certain Event
 Complement of an Event
 Mutually Exclusive Events
 Exhaustive Events
Independent events are those events whose occurrence is not
dependent on any other event. For example, if we flip a coin in
the air and get the outcome as Head, then again if we flip the
coin but this time we get the outcome as Tail. In both cases,
the occurrence of both events is independent of each other. It
is one of the types of events in probability. Let us learn here the
complete definition of independent events along with its Venn
diagram, examples and how it is different from mutually
exclusive events.
Independent Events Vs Mutually Exclusive Events
 There is the difference between the independent events and
mutually exclusive events are given below:
1. Independent Events-
 They cannot be specified based on the outcome of a
maiden trial.
 Can have common outcomes
 If X and Y are two independent events, then
P(X ∩ Y) = P(X) .P(Y)
2. Mutually exclusive events-
 They are independent of trials
 Can never have common outcomes.
 If X and Y are two mutually exclusive events,
then P(X ∩ Y) = 0

ASSIGNMENTS SET-2
Q.4. The data given below depicts the sales statistics of six
sales representative in two different localities. Find whether
there is a relationship between the buying habits of the people in
the localities.
Representative 1 2 3
Locality I 70 40 65
Locality II 70 30 80
Ans. To determine whether there is a relationship between
the buying habits of the people in Locality I and Locality II, we can
analyse the given data using a statistical method to check for a
correlation. Specifically, we can calculate the correlation
coefficient, which will tell us how strongly the sales figures in
Locality I and Locality II are related.
Given Data:
Representative Locality I Locality II

1 70 70

2 40 30

3 65 80
We need to check if there's a relationship between Locality I
(Sales of Representatives) and Locality II (Sales of
Representatives).
Step 1: Calculate the correlation coefficient
The formula to calculate the Pearson correlation coefficient (rrr)
is:
r=n∑xy−∑x∑y(n∑x2−(∑x)2)(n∑y2−(∑y)2)r = \frac{n \sum{xy} - \sum{x}
\sum{y}}{\sqrt{(n \sum{x^2} - (\sum{x})^2)(n \sum{y^2} -
(\sum{y})^2)}}r=(n∑x2−(∑x)2)(n∑y2−(∑y)2)n∑xy−∑x∑y
Where:
 xxx represents the sales figures for Locality I,
 yyy represents the sales figures for Locality II,
 nnn is the number of data points (here, n=3n = 3n=3).
Step 2: Calculate the necessary sums
From the data, we have:
 x1=70,x2=40,x3=65x_1 = 70, x_2 = 40, x_3 = 65x1=70,x2
=40,x3=65
 y1=70,y2=30,y3=80y_1 = 70, y_2 = 30, y_3 = 80y1=70,y2
=30,y3=80
Now, let's calculate the necessary sums:
1. Sum of xxx:
∑x=70+40+65=175\sum{x} = 70 + 40 + 65 = 175∑x=70+40+65=175
2. Sum of yyy:
∑y=70+30+80=180\sum{y} = 70 + 30 + 80 = 180∑y=70+30+80=180
3. Sum of x2x^2x2:
x12=702=4900,x22=402=1600,x32=652=4225x^2_1 = 70^2 =
4900, \quad x^2_2 = 40^2 = 1600, \quad x^2_3 = 65^2 = 4225x12
=702=4900,x22=402=1600,x32=652=4225
∑x2=4900+1600+4225=10725\sum{x^2} = 4900 + 1600 + 4225 =
10725∑x2=4900+1600+4225=10725
4. Sum of y2y^2y2:
y12=702=4900,y22=302=900,y32=802=6400y^2_1 = 70^2 = 4900,
\quad y^2_2 = 30^2 = 900, \quad y^2_3 = 80^2 = 6400y12
=702=4900,y22=302=900,y32=802=6400
∑y2=4900+900+6400=12100\sum{y^2} = 4900 + 900 + 6400 =
12100∑y2=4900+900+6400=12100
5. Sum of xyxyxy:
x1y1=70×70=4900,x2y2=40×30=1200,x3y3=65×80=5200x_1y_1 =
70 \times 70 = 4900, \quad x_2y_2 = 40 \times 30 = 1200, \quad
x_3y_3 = 65 \times 80 = 5200x1y1=70×70=4900,x2y2
=40×30=1200,x3y3=65×80=5200 ∑x
y=4900+1200+5200=11300\sum{x y} = 4900 + 1200 + 5200 =
11300∑xy=4900+1200+5200=11300
Step 3: Substitute the values into the formula
Now, substitute these values into the formula for the correlation
coefficient:
r=3×11300−175×180(3×10725−1752)(3×12100−1802)r = \frac{3
\times 11300 - 175 \times 180}{\sqrt{(3 \times 10725 - 175^2)(3
\times 12100 - 180^2)}}r=(3×10725−1752)(3×12100−1802)
3×11300−175×180
Numerator:
3×11300=33900,175×180=315003 \times 11300 = 33900, \quad
175 \times 180 = 315003×11300=33900,175×180=31500
Numerator=33900−31500=2400\text{Numerator} = 33900 - 31500
= 2400Numerator=33900−31500=2400
Denominator:
First, calculate each part of the denominator:
3×10725=32175,1752=306253 \times 10725 = 32175, \quad
175^2 = 306253×10725=32175,1752=30625
3×12100=36300,1802=324003 \times 12100 = 36300, \quad
180^2 = 324003×12100=36300,1802=32400
Now, calculate the denominator:
Denominator=(32175−30625)(36300−32400)=(1550)(3900)=6045
000≈2457.66\text{Denominator} = \sqrt{(32175 - 30625)(36300 -
32400)} = \sqrt{(1550)(3900)} = \sqrt{6045000} \approx.
2457.66Denominator=(32175−30625)(36300−32400)
=(1550)(3900)=6045000≈2457.66
Step 4: Final calculation of rrr
r=24002457.66≈0.976r = \frac{2400}{2457.66} \approx.
0.976r=2457.662400≈0.976
Step 5: Interpretation
The correlation coefficient r≈0.976r \approx. 0.976r≈0.976, which
is very close to +1. This indicates a strong positive relationship
between the sales in Locality I and Locality II. As the sales in
Locality I increase, the sales in Locality II also tend to increase in
a similar pattern.
Conclusion:
There is a strong positive relationship between the buying habits
of the people in Locality I and Locality II, as shown by the high
correlation coefficient of approximately 0.976.

Q.5. Discuss the concept, objective and assumptions of

ANNOVA
Ans. ANOVA (Analysis of Variance) is a statistical method
used to test whether there are any statistically significant
differences between the means of three or more independent
groups or treatments. It does this by comparing the variance
within groups to the variance between groups. The basic idea
behind ANOVA is to determine if the differences in sample means
are large enough to be considered statistically significant, or if
they are just due to random chance.
In other words, ANOVA helps determine whether the observed
variation in the data can be explained by the treatment or factor
under study, or if it is simply due to random variation within the
groups.
Objectives of ANOVA
1. Compare means across multiple groups: The primary
objective of ANOVA is to compare the means of three or
more groups to determine if at least one group mean is
significantly different from the others.
2. Test for statistical significance: ANOVA helps to test the null
hypothesis, which states that all group means are equal. If
the null hypothesis is rejected, it implies that at least one
group mean is different from the others.
3. Analyse variance within and between groups: It assesses
how much of the total variance in the data is attributable to
differences between the groups (between-group variance)
and how much is attributable to variability within the groups
(within-group variance).
4. Control Type I error: ANOVA is particularly useful because it
controls for Type I errors (false positives) that may arise if
multiple t-tests are performed to compare all possible pairs
of groups.
Assumptions of ANOVA
For ANOVA to be valid and produce reliable results, several
assumptions must be met:
1. Independence of observations: The data points in each
group must be independent of each other. This means that
the observation of one individual should not influence the
observation of another.
 2. Normality: The data in each group should follow a normal
distribution. This assumption ensures that the F-statistic
used in ANOVA follows the expected distribution under the
null hypothesis.
3. Homogeneity of variances (Homoscedasticity): The variance
within each group should be approximately equal. This
means that the spread or dispersion of the data within each
group should be similar. This assumption can be tested
using tests such as Levene's test or Bartlett's test.
4. Scale of measurement: The dependent variable should be
measured on an interval or ratio scale (continuous data).
5. Random sampling: The samples from each group should be
randomly selected to ensure the generalizability of the
results.
Types of ANOVA
 One-way ANOVA: Used when there is one factor or
independent variable with three or more levels (groups). For
example, comparing the average test scores of students
from three different schools.
 Two-way ANOVA: Used when there are two independent
variables (factors) and it examines not only the main effects
of each factor but also the interaction effect between them.
For example, comparing the performance of students based
on their school and gender.
 Multivariate Analysis of Variance (MANOVA): An extension of
ANOVA when there are two or more dependent variables.
Steps Involved in Conducting ANOVA
1. State the hypotheses:
 o Null hypothesis (H0H_0H0): All group means are equal
(no significant difference).
o Alternative hypothesis (H1H_1H1): At least one group
mean is different.
2. Calculate the F-statistic: The F-statistic is the ratio of the
variance between groups to the variance within groups. If
this value is large, it suggests that the group means are
significantly different.
3. Determine the p-value: The p-value helps to decide whether
to reject the null hypothesis. If the p-value is less than the
chosen significance level (e.g., 0.05), then the null
hypothesis is rejected.
4. Interpret the results: If the p-value is small, it indicates that
there is a significant difference between the group means. If
the p-value is large, it suggests that any differences
observed are likely due to random chance.
Conclusion
In summary, ANOVA is a powerful statistical tool for comparing
multiple group means to determine if there are any significant
differences between them. By understanding its concept,
objectives, and assumptions, researchers can correctly apply
ANOVA to a wide variety of data sets and draw valid conclusions
about group differences.
Q.6. What are the components of time series? Bring out the
significance of moving average in analysing a time series and
point out its limitations.
Ans A time series is a sequence of data points measured at
successive points in time, typically with equal intervals between
them. It is used to analyse how the data changes over time and to
detect underlying patterns. The components of a time series are
typically broken down into four main categories.
Trend :-
 The trend component represents the long-term movement
in the data. It shows the overall direction the series is
moving over time, which could be upward (growth),
downward (decline), or stable. A trend can occur over a long
period and is generally gradual.
 Example: The upward movement in stock prices or the
gradual decline in the mortality rate over time.
Seasonality :-
 Seasonality refers to regular, predictable patterns or
fluctuations that occur at specific periods, such as daily,
monthly, or yearly. These fluctuations are often driven by
external factors like weather, holidays, or societal patterns.
 Example: Increased retail sales during the holiday season or
higher electricity consumption during summer months due
to air conditioning.
Significance of Moving Average:
1. Smoothing Short-Term Fluctuations:
o Moving averages help smooth out short-term
irregularities (random noise) in the data. This allows
analysts to better see the underlying trend and reduce
 the effect of random variations that may not be
meaningful.
2. Trend Identification:
o Moving averages are particularly useful for identifying
the general direction (upward, downward, or stable) of
a time series. By smoothing the data, they make it
easier to distinguish long-term trends from short-term
noise.
3. Noise Reduction:
o A moving average reduces the effect of random
variations by averaging data over a period. This makes
it easier to identify meaningful patterns and detect
shifts or changes in the data.
Here is the some Limitations of Moving Average-
While moving averages are a powerful tool in time series analysis,
they have several limitations:
1. Lagging Indicator:
o A moving average is a lagging indicator because it
respond to before data. It cannot suddenly forecast
sudden shifts or trends in the data, and thus, it always
being left behind real-time changes.
2. Edge Effects:
o Moving averages can produce unreliable results at the
edges of the time series, especially when the data
window is fixed. For example, the first few and last few
data points will have fewer data points available to
calculate the average, which can lead to inaccuracies.
However, moving averages have limitations such as being
lagging indicators, over-smoothing data, and being sensitive
to the choice of window size. These limitations must be kept
in mind when applying moving averages, and sometimes,
more sophisticated techniques may be needed for more
accurate analysis and forecasting.