‘Hla, that is, mean +1 standard deviation covers 68.27% of the items in a data set. ‘2a, that is, mean +2 standard deviation covers 95.45% of the items in a data set, '43o, that is, mean +3 standard deviation covers 99.73 of the items in a data set. FFigare 4.11 explains the area under the normal curve. 4.6 EMPIRICAL RELATIONSHIP BETWEEN MEASURES OF DISPERSION In the case of a symmetrical distribution, the empirical relaionship between the various measures of dispersion fs given by: 2 sanand devia nats, 0-20 4 1. Quartile deviation 2, Mean absolute deviation Standard deviation, that is, MAD 5 3. Quartile deviation =2 Mean absctedevistion, thats, QD 4, 6 Standard deviation = 9 Quartile deviation = 7.5 Mean absolute deviation, tat is, 67 = 9 Qo=7.5 MAD 3 5. Standard deviation =2 Mean absolute deviation or 5 Quartile deviation, that is so=5 3 MAD 05D 7 6, Range= 6 Standard deviation R= 60, 4.7 CHEBYSHEV'S THEOREM Empirical rule applies only to normally distributed data, I: has a wide range of application, but in cases where data distribution is not normal or where the shape of the distribution is not known, its plication is restricted. Chebyshev’s theorem provides an answer to this problem. It was developed by Russian mathematician P. L. Chebyshev (1821-1894). Chebyshev’s theorem states that regardless of tee ote db a 1~_y ves fi vil andi net Na spi iin sr vino een att = 7 ft al Ifk sat least 1 0, thatis, 0% of the values will fall within +0 of the mean regardless 0.15, that is, 75% of the values will fall within #2 0 of the mean regardless of the shape of the distribution. For k= A eT? of the shape ofthe distribution. Similarly, when k= 2, at least at 50889 ais 88% of he ales wil il wihn70f te mean ears of the shape of the distribution, For k= 4, at least 1-2 9375, that is, 93.75% of the values will fell within :4o ofthe mean regardless ofthe shape of the distribution. This theorem has its 1-0, that is, 0% of the values will fall within 47 of own limitation. For k= at east 1 the mean, This result does not provide any information 4.8 MEASURES OF SHAPE Measures of shape are the tools used for éescribing the shape of distribution ofthe data. This section focuses on two measures of shape: skewness and kurtosis. Box-and-whisker plots are also discussed in this chapter. Chapter 4 | Measures of Dispersion 135BUSINESS STATISTICS NAVAL BAJPAI ya Business Statistics offers readers a foundation in core statistical concepts using a perfect blend of theory and practical application. This book presents business statistics as value added tools in the process of converting, data into useful information. A large number of solved examples and practice questions introduced throughout the chapters help students master concepts. Additional problems at the end of every chapter provide further opportunity for practice The step-by-step approach used to discuss three main statistical software applications, MS Excel, Minitab, and SPSS, which are critical tools for decision making in the business world, makes this book extremely user-friendly. Indian case studies and examples demonstrate the many uses of statistics in business and economics. The underlying focus on the interpretation of results rather than computation makes this book highly relevant for students and practicing managers. FEATURES + ACD-ROM with MS Excel and Minitab data files of all the problems in the book as well as the trial version of Minitab"15 The Statistics in Action feature links the concepts discussed in the chapter to actual practice in the industry + Case studies highlight the business applications of statistics across various business sectors in India + Numerous examples and problems framed using current data from organizations such as the CMIE and Indiastat.com + Mathematical as well as MS Excel, Minitab, and SPSS solutions for all problems + Marginal definitions and summaries that reinforce critical concepts A companion Web site featuring learning objectives, multiple choice questions and an instructors’ manual with key topics presented through PowerPoint lecture slides eM eee || | | ili TO wewn pearsoned.co.in |