University School of Business

MBA
SUBJECT NAME: Decision Science-I
SUBJECT CODE: 21BAT604

TOPIC OF PRESENTATION
ClASSIFICATION OF DATA DISCOVER . LEARN . EMPOWER
Course Outcome After undergoing this Course, the students will be able:

CO1 To understand and remember the nature of data and various statistical
techniques
CO2 To categorize and correlate the different descriptive measures with the
various complex managerial problems
CO3 To examine the results of different statistical techniques on diverse set
of data
CO4

To predict and forecast the future through time series modeling

CO5 To apply the principles of inferential statistics and develop solutions
for the business & social problems.
What is data?
Basic statistical data are data collected by survey statisticians, scientists and researchers to be
edited, imputed, aggregated, analyzed and / or used in the compilation and production of
statistical findings and/or theories.

Statistical data are observable, empirical and measurable evidence subject to specific principles of
reasoning. This data is collected through observation and experimentation.
Classification of Data

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 Need of classification

• After the data have been collected the next step is to present in some
orderly and logical form so that their essential features may become explicit .
• The unorganised and shapeless data can neither be easily competent nor
interpreted. Therefore, after the collection of data it is important that data
are classified and presented in such a way as to bring out point of similarities
and dissimilarities in the data.
 CLASSIFICATION OF DATA

Classification is the process of arranging the data into different groups or classes according to some
common characteristics. The process of classification is compared to the process of sorting out
operation, all collected letters and packets are separated on the basis of the common characteristic,
i.e. their destinations, Thus ,in the process of classification data are classified into various
homogeneous groups or classes on the basis of similarities and resemblances
 OBJECTIVES OF CLASSIFICATION

 To facilitate comparison i.e. to make the data comparable.

 To point out the most important feature of the data at a glance.
 To present the data in a brief form.
 To enable statistical treatment of the data collected.
 To make data attractive and effective.
 To condense the mass of data in such a way that their similarities and
dissimilarities become very clear.
 METHODS OF
CLASSIFICATION
• Geographical Classification
• Chronological Classification
• Qualitative Classification
• Quantitative classification
 GEOGRAPHICAL CLASSIFICATION:
In geographical classification, data are classified on the basis of
geographical or locational differences between the various items. For
example, we may present the number of firms producing bicycles states
wise as follows .

No. of firms producing bicycles in 2001

STATE No. OF FIRMS
Punjab 30
Haryana 20
U.P 25
CHRONOLOGICAL CLASSIFICATION

When data are classified on the basis of time , it is known as

chronological classification. For example, we may present population
figures on the basis of time as given in the following manner.
Population of India (1951-1991)
YEAR POPULATION ( in crores)
1951 36.1
1961 43.9
1971 54.8
1981 68.4
1991 84.4
 QUANTITATIVE CLASSIFICATION
When data are classified on the basis of some characteristics which is capable of
direct quantitative measurement such as height, weight, income, marks. etc., it is called
quantitative classification or numerical or grouped classification. For instance, students
of a college may be classified according to weight as shown in the following table :

WEIGHT ( in Ibs) NO. OF STUDENTS

70-80 40
80-90 50
90-100 150
100-110 250
110-120 200
QUALITATIVE CLASSIFICATION

In this type of classification , data are classified on the basis of some attribute
or quality such as Gender, literacy, religion, etc. This classification may be of two
types :
(i)Simple Classification: When only one attribute is studied, e.g., classification of
population acc. to sex- male or female, this type of classification is called simple
classification.
(ii)Manifold Classification: When more than one attribute is studied, it is called
manifold classification, e.g., population may be classified as rural and urban.
These may be further classified as male or female and still further classified as
educated or uneducated.
BASIC CONCEPTS

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 VARIABLE
The characteristic, which is capable of direct quantitative measurement is called a variable or variate. Height
weight, production, consumption, marks, etc., are called variables. A variable may be either discrete or
continuous .

(1) Discrete variable: A discrete variable is that one which takes only isolated or discontinuous values. There are
jumps in case of a discrete variable, e.g., no. of goals scored in a match is a discrete variable .

(2) Continuous variable: A continuous variable is one which can take any value in a specified interval. Temperature
recorded of patients in a hospital, heights of all BBA students of Kurukshetra university , wages of all workers are
examples of continuous variables.
 WAYS OF CLASSIFY NUMERICAL DATA OR RAW
DATA
• Numerical data or raw data can be classified in any of two ways:
1. Ordered array or individual series
2. Frequency distribution:
(a) discrete frequency distribution or discrete series
(b) Continuous frequency distribution or continuous series
 (1) Ordered array or individual series
An ordered array or individual series is an orderly arrangement of data according to the
ascending or descending order of magnitude. So, on order to prepare an array, the only thing to be
done is to arrange the data or various values of variable in ascending or descending order of
magnitude. An array may be useful if the data are small , but if the variable takes a large number of
values, an array becomes unwieldy.
 Example 1. following data relate to the pocket expenses
(rupees) of 10 students of b.com class. Array them in ascending
and descending order:
50,20,30,15,45,40,35,25,20,43

(a) Pocket expenses(rupees) of 10 students (b) Pocket expenses(rupees) of 10 students

(in ascending order) (in descending order)

15 35 50 30

20 40 45 25

20 43 43 20

25 45 40 20

30 50 35 15
• (2) Frequency distribution
The frequency distribution is a statistical table which shows the values of variable
arranged order of magnitude, either individually or in groups, and also the corresponding
frequencies side by side. There are two types of frequency distributions:

(a) discrete frequency distribution

(b) grouped frequency distribution

 (a) Discrete frequency distribution:
It is a statistical table which shows the values of variable individually and also the
corresponding frequencies side by side.In its construction, we count the frequencies of the
various items. To find the frequency of a particular item, we make use of tally bars. Each tally
bar indicates the presence of one value of the item. Tally bars are used in the form of ‘four and
cross method’. The value of the item is repeated five times, a cross is on four lines.
• Example 2.Twenty students of b.com class secured the following narks in
the economics out of 50 marks:

11 12 14 11 16 11 17 16 17 14
Present the data in the discrete frequency distribution.
17 18 20 14 20 17 20 17 14 20
solution: formulation of a discrete frequency distribution

Marks Tally bars Frequency

11 III 3
12 I 1
14 IIII 4
16 II 2
17 IIII 5
18 I 1
20 IIII 4
Total 20
• Grouped frequency distribution:
It is a statistical table which shows the values of the
variable In groups and also the corresponding frequencies side by
side. Am example of a grouped frequency distribution is given
below:

Daily wages (Rs) No. of workers

40-50 7
50-60 12
60-70 8
70-80 6
80-90 2
total 35
• Useful term associated with grouped frequency distribution
For a detailed study of grouped frequency distribution, it is necessary to define and
understand following terms:
(a)Class interval or class: it is a group of numbers in which items are placed such as 10-
20, 20-30 etc.
(b)Class frequency: the number of observations falling within a class is called its class
frequency. It is denoted by ‘f’.
(c)Class limits: each class is located between two numbers. These two numbers constitute
class limits. The lowest value of a class is its lower limit and higher value is termed as
upper limit. For example, 10-20 ,lower limit is 10 and the upper limit is 20.
(d) Class mark or mid –value: It is the average value of the upper
limit and the lower limit symbolically.

M.V.(m)=(L1+L2)/2

(e) Width or magnitude of the class : the width or size or

magnitude of a class is the difference between its lower and upper
class limits. Symbolically,

i=L1-L2
 PROBLEMS IN THE CONSTRUCTION OF FREQUENCY DISTRIBUTION

(1) Selection of number of classes : There are no hard and fast rules about the selection of no. of
classes. It depends on a number of factors such as

(i)the number of items to be classified

(ii)the magnitude of the class interval,

(iii)the accuracy desired

(iv)the ease of calculation for further processing of data and

(v)Size of last interval.

 However, the number of classes should be neither too large nor too small. It may be
recommended that the number of classes should not be less than 5 or 6 and should not be greater
than 5 or 20. However, there is no rigidity about it.

Prof. H.A.Sturge have given a formula by which the number of class interval can be ascertained.
The formula is :

k = 1 + 3.322 log N

( here k=no. of class intervals; N= total no. of observations

(2) Size of class Intervals :

The choice of class interval depend on the number of classes for a given
distribution and size of the data. As far as possible the class intervals should be
equal size. Prof. Sturge have given the following formula for determining the
size of class intervals:

Size of class interval : i = Largest value-smallest value

1+ 3.322 log N

( Here , N= Total frequency , i= size of class Interval)

 (3) Selection of class limits : Class limits should be selected in such a way
that

(a)the mid values of the classes coincide or come very close to the point of
concentration in the data

(b) the overlapping of classes is avoided

(c) the class limits must be stated precisely enough so that there will be no
confusion as to what they include.
CONSTRUCTION OF FREQUENCY
DISTRIBUTION
Example: Given below are the marks of 20 students of a
class. Make a discrete frequency distribution.

10 12 18 14 13 10 12 15 17 19

18 16 14 15 17 11 20 13 12 14
SOLUTION: Construction of a discrete frequency
distribution
Marks Tally bars No. of students(f)
10 || 2
11 | 1
12 ||| 3
13 || 2
14 ||| 3
15 || 2
16 | 1
17 || 2
18 || 2
19 | 1
20 | 1
  Total 20
 References
TEXT BOOKS
• 1. Levine, D., Sazbat, K. and Stephan, D. 2013. Business Statistics, 7thEdition,
Pearson Education, India, ISBN: 9780132807265.
• 2. J.K Sharma, 2012. Business Statistics, 2nd Edition, Sixth Impression, Pearson
Education India, 2012 a, ISBN: 9788177586541
 
REFERENCE BOOKS
• R1 J.K Sharma, Fourth Edition 2014 Business Statistics , Vikas Publishing House ,
ISBN: 9789325980805.
• R2 Gupta, S. 2011. Statistical Methods, 4thEdition, Sultan Chand & Sons, ISBN:
8180548627

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 REFERENCES
• Reference Website

https://www.google.com/search?q=investopedia&rlz=1C1CHBF_enIN859IN859&oq=investopedia+&aqs=chrome..69i57j0l
2j69i60l3.3907j0j7&sourceid=chrome&ie=UTF-8
https://www.google.com/search?q=investopedia&rlz=1C1CHBF_enIN859IN859&oq=investopedia+&aqs=chrome..69i57j0l2j6
9i60l3.3907j0j7&sourceid=chrome&ie=UTF-8

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Assessment Pattern

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 THANK YOU

For queries get in touch with me at: [email protected]

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