Statistical Techniques in Business &
Economics
Douglas Lind,
William Marchal &
Samuel Wathen
McGraw-Hill/Irwin ©The McGraw-Hill Companies, Inc. 2008
107 QUA
COURSE CONTENTS
Chapter Title
1 What is Statistics
2
Describing Data: Frequency Distributions and Graphic Presentatio
n
.
3 Describing Data: Numerical Measures
4 Describing Data: Displaying and Exploring Data
5 A Survey of Probability Concepts
6 Discrete Probability Distributions
2
STAT 107
COURSE CONTENTS
Chapter Title
7 Continuous Probability Distributions
13 Linear Regression and Correlation
15 Index Numbers
16 Time Series and Forecasting
3
What is Statistics
Chapter 1
McGraw-Hill/Irwin ©The McGraw-Hill Companies, Inc. 2008
GOALS
Understand why we study statistics.
Explain what is meant by descriptive
statistics and inferential statistics.
Distinguish between a qualitative variable
and a quantitative variable.
Describe how a discrete variable is different
from a continuous variable.
Distinguish among the nominal, ordinal,
interval, and ratio levels of measurement.
5
What is Meant by Statistics?
Statistics is the science of
collecting, organizing, presenting,
analyzing, and interpreting
numerical data to assist in
making more effective decisions.
6
Who Uses Statistics?
Statistical techniques are used
extensively by marketing,
accounting, quality control,
consumers, professional sports
people, hospital administrators,
educators, politicians, physicians,
etc...
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Types of Statistics
1.Descriptive Statistics - methods of
organizing, summarizing, and presenting
data in an informative way.
EXAMPLE 1: A Gallup poll found that 49%
of the people in a survey knew the name
of the first book of the Bible. The statistic
49 describes the number out of every 100
persons who knew the answer.
8
Types of Statistics – Descriptive Statistics
EXAMPLE 2: According to Consumer
Reports, General Electric washing
machine owners reported 9 problems per
100 machines during 2001. The statistic 9
describes the number of problems out of
every 100 machines.
2.Inferential Statistics: A decision, estimate,
prediction, or generalization about a
population, based on a sample.
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Population versus Sample
A population is a collection of all possible
individuals, objects, or measurements of
interest.
A sample is a portion, or part, of the population
of interest
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Types of Variables
A. Qualitative or Attribute variable - the
characteristic being studied is nonnumeric.
EXAMPLES: Gender, religious affiliation, type of
automobile owned, state of birth, eye color are
examples.
B. Quantitative variable - information is reported
numerically.
EXAMPLES: balance in your checking account,
minutes remaining in class, or number of children in a
family.
11
Quantitative Variables - Classifications
Quantitative variables can be classified as either
discrete or continuous.
A. Discrete variables: can only assume certain
values and there are usually “gaps” between
values.
EXAMPLE: the number of bedrooms in a house, or the
number of hammers sold at the local Home Depot
(1,2,3,…,etc).
B. Continuous variable can assume any value within
a specified range.
EXAMPLE: The pressure in a tire, the weight of a
pork chop, or the height of students in a class.
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Summary of Types of Variables
13
Four Levels of Measurement
Nominal level - data that is Interval level - similar to the ordinal
classified into categories and level, with the additional property
cannot be arranged in any that meaningful amounts of
particular order. differences between data values
EXAMPLES: eye color, gender, can be determined. There is no
religious affiliation. natural zero point.
EXAMPLE: Temperature on the
Fahrenheit scale.
Ordinal level – involves data
arranged in some order, but the Ratio level - the interval level with an
differences between data values inherent zero starting point.
cannot be determined or are Differences and ratios are
meaningless. meaningful for this level of
measurement.
EXAMPLE: During a taste test
of 4 soft drinks, Mellow Yellow EXAMPLES: Monthly income of
was ranked number 1, Sprite surgeons, or distance traveled by
number 2, Seven-up number 3, manufacturer’s representatives
and Orange Crush number 4. per month.
14
Summary of the Characteristics for Levels
of Measurement
15
End of Chapter 1
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