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Chapter 3: NUMERICAL DESCRIPTIVE MEASURES

Specific objective: To use mathematical tools in statistics to describe measures.

3.1. SUMMATION NOTATION

EXAMPLE 3-1: Annual Salaries of Workers

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EXAMPLE 3-2:

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3.1. The number of shoe pairs owned by six women is 8, 14, 3, 7, 10, and 5, respectively. Let
x denote the number of shoe pairs owned by a woman. Find:

3.2. The following table lists five pairs of m and f values.

Compute the value of each of the following:

3.3. The following table lists six pairs of x and y values.

Compute the value of each of the following:

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3.4. Eight randomly selected customers at a local grocery store spent the following amounts on
groceries in a single visit: $216, $184, $35, $92, $144, $175, $11, and $57, respectively. Let y
denote the amount spent by a customer on groceries in a single visit. Find:

3.5. A car was filled with 16 gallons of gas on seven occasions. The number of miles that the
car was able to travel on each tankful was 387, 414, 404, 396, 410, 422, and 414. Let x denote
the distance traveled on 16 gallons of gas. Find:

3.2. DESCRIBING THE CENTER OF A DATA SET

3.2.1. The Mean

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Example 3.3: Improving Knee Extension

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Example 3.4: County Population Sizes

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Example 3.5: Number of Visits to a Class Web Site

3.2.2. The Median

We now turn our attention to a measure of center that is not so sensitive to outlier, the median.

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Example 3.6: Web Site Data Revised

The sample size for the web site access data of Example 4.3 was n! 40, an even number. The
median is the average of the 20th and 21st values (the middle two) in the ordered list of the
data. Arranging the data in order from smallest to largest produces the following ordered list:

3.2.3. Comparing the Mean and the Median

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3.6. The Highway Loss Data Institute publishes data on repair costs resulting from a 5-mph
crash test of a car moving forward into a flat barrier. The following table gives data for 10
midsize luxury cars tested in October 2002:

3.7. USA Today (May 9, 2006) published the accompanying average weekday circulation for
the six month period ending March 31, 2006 for the top 20 newspapers in the country:

a. Which of the mean or the median do you think will be larger for this data set? Explain.
b. Compute the values of the mean and the median of this data set.
c. Of the mean and median, which does the best job of describing a typical value for this data
set?
d. Explain why it would not be reasonable to generalize from this sample of 20 newspapers to
the population of daily newspapers in the United States.

3.3. DESCRIBING VARIABILITY IN A DATA SET

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3.3.1. Deviations from the Mean

Example 3.7: Acrylamide Levels in French Fries

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3.3.2. The Variance and Standard Deviation

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Example 3.8: French Fries Revisited

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3.8. A sample of n= 5 college students yielded the following observations on number of traffic
citations for a moving violation during the previous year:

3.9. Give two sets of five numbers that have the same mean but different standard deviations,
and give two sets of five numbers that have the same standard deviation but different means.

3.10. The article “Rethink Diversification to Raise Returns, Cut Risk” (San Luis Obispo
Tribune, January 21, 2006) included the following paragraph:
In their research, Mulvey and Reilly compared the results of two hypothetical portfolios and
used actual data from 1994 to 2004 to see what returns they would achieve. The first portfolio
invested in Treasury bonds, domestic stocks, international stocks, and cash. Its 10-year average
annual return was 9.85 percent, and its volatility measured as the standard deviation of annual
returns was 9.26 percent. When Mulvey and Reilly shifted some assets in the portfolio
to include funds that invest in real estate, commodities, and options, the 10-year return rose to
10.55 percent while the standard deviation fell to 7.97 percent. In short, the more diversified
portfolio had a slightly better return and much less risk.
Explain why the standard deviation is a reasonable measure of volatility and why it is
reasonable to interpret a smaller standard deviation as meaning less risk.
3.11. The U.S. Department of Transportation reported the accompanying data on the number
of speedingrelated crash fatalities during holiday periods for the years from 1994 to 2003
(Traffic Safety Facts, July 20, 2005).

a. Compute the standard deviation for the New Year’s Day data.
b. Without computing the standard deviation of the Memorial Day data, explain whether the
standard deviation for the Memorial Day data would be larger or smaller than the standard
deviation of the New Year’s Day data.
c. Memorial Day and Labor Day are holidays that always occur on Monday and Thanksgiving
always occurs on a Thursday, whereas New Year’s Day, July 4th and Christmas do not always
fall on the same day of the week every year. Based on the given data, is there more or less
variability in the speeding-related crash fatality numbers from year to year for same day of the
week holiday periods than for holidays that can occur on different days of the week? Support
your answer with appropriate measures of variability.

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3.12. Cost-to-charge ratios (see Example 4.9 for a definition of this ratio) were reported for the
10 hospitals in California with the lowest ratios (San Luis Obispo Tribune, December 15,
2002). These ratios represent the 10 hospitals with the highest markup, because for these
hospitals, the actual cost was only a small percentage of the amount billed. The 10 cost-to-
charge values (percentages) were:

a. Compute the variance and standard deviation for this data set.
b. If cost-to-charge data were available for all hospitals in California, would the standard
deviation of this data set be larger or smaller than the standard deviation computed in Part (a)
for the 10 hospitals with the lowest cost-to-charge values? Explain.
c. Explain why it would not be reasonable to use the data from the sample of 10 hospitals in
Part (a) to draw conclusions about the population of all hospitals in California.

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