KAMPALA INTERNATIONAL UNIVERSITY

COLLEGE OF ECONOMICS AND MANAGEMENT

COURSE UNIT : : BUSINESS STATISTICS

COURSE CODE : STA2101
YEAR : TWO
SEMESTER : ONE
SESSION : DAY
LECTURER : MR. LUGGYA HERBERT
GROUP MEMBERS

NO. NAME REG NUMBER COURSE SIGN

1. BABIRYE GLORIA 2022-01-08497 BBA
2. NASSALI BUSHIRA 2021-04-04113 BSP
3. NANYONGA REHEMA NDAGIRE 2022-01-07975 BBA
QUESTION
SECTION A

Write short notes giving examples on following terms

i. Statistics
ii. Business
iii. Population
iv. Sample
v. Parameter
vi. Stastic
vii. Source of data
viii. Level of measurement
ix. Sampling error
x. Standard error
SECTION B
Form groups of three students, go to KIU exit gate for one hour. count the following types of vehicles
moving from Kansanga to Kabalagala, bodabodas, taxis, my cars, trucks and pickups, lorries and
buses

(a) Assume a road toll is established at kiu exit gates and the following charges levied respectively
bodabodas- 1000shs, mycars- 2000shs, taxis- 3000shs , trucks and pickups- 5000shs , lorries and
buses- 10,000shs;

b) Assume 12 hrs worked per day

c) Assume 22 working days per month

d) How much revenue would be collected from the roadtoll per day, per month and per year?
e) Assume 500 million is required to construct 1 km of tarmac road. How many kilometres of tarmac
road will be constructed in one year?

SECTION A
I)STATISTICS. Statistics refers to numerical statement of facts capable of analysis and
Interpretation as well as study of the methods used in collection, organization, presentation,
analysis and interpretation of numerical data.

Statistics refers to the study of numerical data, facts, figures and measurements.

Statistics also refers to the discipline that concerns the collection, organization, analysis,
interpretation and presentation of data.

According to Bowley, “statistics is a science of averages.” He defined statistics as

“Numerical statement of facts in any department of enquiry placed in relation to each other.”

Most of the information around us is determined with the help of statistics;

• Weather forecasts

• Medical studies

• Quality testing

• Stock markets

• Predicting emergencies. Types of statistics

1. Descriptive statistics. Summarizes data from a sample using indexes such as the mean or
standard deviation. Make use of Graphs, tables, charts describe a certain phenomenon

2. Inferential statistics. Draw conclusions from data that are subject to random variation. All
generalization made through descriptive statistics may not necessarily be true and therefore is
used to test the validity of the generalizations made. It involves estimating and validating
facts and figures for the figures for the purpose of decision making.

Importance of statistics

 Helps In measuring the after effects of the policies implemented. The policies can be
reframed after considering the effects by analyzing and studying the previous
subjects.
• Helps in comparisons made between past and present results with a view to ascertaining the
reason for changes which have been taken place and the effect of such changes in the future.

• In Business: It helps to make swift decisions by Providing useful information about

customer trends and variations cost customer trends and variations, price customer trends and
variations.

• In Mathematics: It helps in describing measurements and providing accuracy of theories.

• In Economics: It helps to find relationship between two variables like demand and supply,
cost and revenue, imports and exports and helps to establish relationship between inflation
rate, per capita income, income distribution.

• In Accounts: It helps to discover trends and create projections for the next year. In Physics:
lt helps to compute distance between objects in space.

• Research: it helps in formulating and testing hypothesis.

• Government: takes help of statistics to make budgets, set minimum wages, estimate cost of
living.

II) BUSINESS.

Business is the activity of making one’s living / making money by producing or buying and
selling products.

Business is an organization comprising people who strive together to achieve common

objectives and goals.

Business is a legally-recognized organization which provides goods, services or both to the

consumers.

Different scholars define business differently;

Prof. Owen, define business as an enterprise engaged in the production and distribution of
goods for sale in the market / rendering of services for a price.
Melvin Anshen, business is the activity which is pursued by a human being of the acquisition
of wealth.

R.L. Dicksee, has rightly defined business as, a form of activity pursued, primarily with the
object of earning profit for the benefit of those on whose behalf; the activity is conducted.

Alfred Marshal, refers to an activity which is pursued by a human being for the acquisition
of wealth, for instance a person selling vegetable and earning some money, a person
operating a daily shop needs to earn some money for living.

Types of business

Business is classified into but is not limited to four types.

• Manufacturing business. This is where producers who develop the product and sell it
either directly to the customer/the middle men to conduct sales. For example: plastic
factories, steel factories.

• Service business. This deals in selling intangible goods to the consumers. Unlike tangible
goods, services cannot be stored / separated from the provider. Service firms offer
professional services, expertise, commission-based promotions, for example saloons, schools,
and consultancy.

• Merchandising business. This is a middle men business strategy where the business buys
products from a manufacturer, wholesaler, or other partners, and sells the same at the retail
price. It is usually known as a “buy and sell” business as they make profits by selling the
products at a price higher than their cost price. For example; Grocery stores, distributors
supermarkets.

•Hybrid business. Have the characteristics of two/more types of businesses explained above.
For example; a restaurant develops its own dishes (manufacturing), sells the products like
cold drinks which are manufactured by other businesses (merchandising) and provide service
to the customers (service).

III) POPULATION
It refers to all subjects or objects possessing some common specified characteristics.
Populations are not just people. Populations may consist of, but not limited to, people,
animals, businesses, buildings, motor vehicles, fanns, objects or events.

When looking at data, it is important to clearly identity the population being studied or
referred to, so that you can understand who or what are included in the data. For example if
you were looking at some Ugandan farming data, you would need to understand whether the
population the date refers to is all farms in Uganda, just farms that grow crops, those that
only have livestock, or some other type of farm.

The population needs to be clearly identified at the beginning of a study. The study should be
based on a clear understanding of who or what is of interest, as well as the type of
information required from that population.

IV) SAMPLE

Sampling is a technique of selecting individual members or subset of the population to make

statistical inferences from them and estimate characteristics of the widely used by researchers
in market research so that they do not need to research the entire population to collect
actionable insights.

It is also time convenient and cost effective mentioned and hence forms the basis of research
design.

For example, if a drug manufacturer would like to research the adverse side effects of a drug
on the country’s population, it is almost impossible to conduct a research study that involves
everyone. In this case, the researcher decides a sample of people from each demographic and
then researches them giving him/her indicative feedback on the drug’s behavior.

V) PARAMETER

This refers to a numerical quantity or attribute of a population that is estimated using data
collected from the population.
Parameters are to populations as statistics are to samples. For example in survey research the
true proportion of voters who vote for a presidential candidate in the next national election
may be of interest. Such parameter may be estimated using a sample proportion computed
from data gathered via a probability sample of registered voters.

VI) STATISTIC

A statistic refers to a characteristic of a sample. Generally a statistic is used to estimate the

value of a population parameter.

For instance, suppose we selected a random sample of 100 students from a school with 1000
students. The average height of the sampled students would be an example of a statistic. In
fact any measurable characteristic of the sample would be an example of a statistic.

VII) SOURCES OF DATA

There are two sources of data

Statistical sources- refer to data that are collected for some official purposes and include
census and officially conducted surveys.

Non-stastical sources- refer to the data that are collected for other administration purposes
or for the private sector.

Different sources of data

Internal sources

When data is collected from reports and records of the organisation itself, they are known as
internal sources. For example a company publishes its annual report on profit and loss, total
sales, loans, wages etc.

External sources when data is collected from sources outside the organisation, they are
known as external sources; for example if a tour and travel company obtains information on
kamataka tourism form Karnataka transport corporation, it would be known as external
source of data.
Types of data

Primary data- this is first hand information that is collected for a specific purpose such as
results from surveys. It is collected from sources such as personal interviews, questionnaires
or surveys with a specific intention and on a specific and observation and discussion by the
researcher him/herself which information is then assessed by that person.

Secondary data- this is information that is already available somewhere, whether it be

journals, on the internet.

VIII) LEVEL OF MEASUREMENT

There are four main levels of measurement; nominal, ordinal, internal and ration.

Levels of measurement also called scales of measurement tell you how precisely variables are
recorder.

There are 4 levels of measurement

Nominal- data can only be categorised, it classifies and labels variables qualitatively for
example nationality eye color

Ordinal- data can be categorised and ranked for example academic grades income.

Interval- data can be categorised, ranked and evenly spaced for example temperature in
degrees, IQ score, income categorised as ranges.

Ration- data can be categorised, ranked, every spaced and has a natural zero for example .
weight in grams, age in years.

It is important to understand the level of measurement of variables because the level of

measurement determines the type of stastical analysis that can be conducted, and therefore
the type of conclusions that can be drawn from the research.

Levels of measurement also indicate the extent to which statisticians, marketing analysists
and financial analysists can use existing data.

Understanding levels of measurement can also help us properly plan your research.
IX) SAMPLING ERROR

It is a statistical error that occurs when an analysis does not select a sample that represents the
entire population of data.

As a result the results found in the sample do not represent the results that would be obtained
from the entire population.

It occurs because a portion and not the entire population is surveyed.

The prevalence of sampling errors can be reduced by increasing the sample size.

In a general, sampling errors can be placed into four categories ; population- specific error,
selection error, sample frame error, or non –response error.

Calculating sampling error

The sampling error formula is used to calculate the overall sampling error in statistical
analysis. The sampling error is calculated by dividing the standards deviaition of the
population by the square root of the size of the sample and then multiplying the resultant with
the Z- score value.

σ
Sampling error = Ƶ X
√ղ

Where

Z = Z score value based on the confidence interval

σ = population standards deviation

ղ = size of the sample

Types

Population specific error

It occurs when a researcher doesn’t understand who to survey.

Selection error
Occurs when the survey is self- selected or when only those participants who are interested in
the survey respond to the questions.

Occurs when the survey is self- selected or when only those participants who are interested in
the survey respond to the questions.

Researcher can attempt to overcome selection error by finding ways to encourange

participation.

Sample frame error

Occurs when a sample is selected form the wrong population data.

Non- response error

Occurs when a useful response is not obtained from the surveys because researcher were
unable to contact potential respondents

X) STANDARD ERROR

Refers to the standard deviation of the sample distribution.

It is also a mathematical tool used in statistics to measure variability. It enables one to arise at
an estimation of what the standards deviation of a given sample is;

It is used to estimate the efficiency, accuracy and consistency of a sample- it measures how
precisely a sampling of standard error.

Standard error of the mean (SEM) standard error of the variance, standard error of the
median, standard error of a regression coefficient.
(b) DATE AT KIU EXIT GATE MONDAY 30TH /01/2023
TIME AT KIU EXIT GATE 12:30 – 1:00PM

A TABLE SHOWING THE NUMBER OF VEHICLES AND ROAD TOLL PAID PER
VEHICLE.

VEHICLES NO OF VEHICLES TALLY ROAD TOLL PAID

PER VEHICLE
Boda Bodas 70 //// //// //// //// 1000shs
//// //// //// ////
//// //// //// ////
//// ////
My cars 50 //// //// //// //// 2000shs
//// //// //// ////
//// ////
Taxis 30 //// //// //// //// 3000shs
//// ////
Trucks & pickups 15 ////
//// //// 5000shs
Lorries & buses 10 //// //// 10,000shs
Total 175 12000shs
Since they assumed 12 working hours per day , 22 working hours in a month, therefore in a
year 12 x 22 = 264 days.

A TABLE SHOWING THE REVENUE COLLECTED FROM THE ROAD TOLL

PER DAY, PER MONTH AND PER YEAR AT KIU EXIT GATE

VEHICLES NO OF ROADTOLLS ROADTOLL ROADTOLL ROADTOLL A

VEHICLES TOTAL (shs) 12HRS PER DAY TOTAL 22DAYS YEAR
PERMONTH
Boda Bodas 70 70 X 1000=70,000 12 X 70,000=840,000 22X 840,000 264 X18480,000
=18,480,000 =4,878,720,000
MY Cars 50 50 X 2000 12 X 100,000 22 X 1200000 264 X26400000
= 100,000 =1,200,000 =26400,000 = 6,969,600,000
Taxis 50 30 X 3000 12 X 90,000 22 X 1,080,000 264 X 23,760,000
= 90,000 =1,080,000 =23,760,000 =6272640,000
Trucks & 15 15 x 5000 12 x 75000 12 x 900,000 264 x 19800,000
pickups =75000 =900,000 =19,800,000 = 5,227,200,000
Lorries & 10 10 x 10,000 12 x 100,000 22 x 1200,000 264 x 26400,000
buses =100,000 = 1200,000 =26,400,000 =6,969,600,000
TOTAL 175 435,000 5,220,000 114,840,000 30,317,760,000
Let the kilometres be x

1 km=500,000,000

30,317,760,000
x=
500,000,000

¿ 60.6 km

60.6 km will be constructed in one year

A GRAPH SHOWING REVENUES FOR 12 HOURS PER DAY

roadtoll total FOR 12 HRS

8,000,000,000

7,000,000,000

6,000,000,000

5,000,000,000

4,000,000,000

3,000,000,000

2,000,000,000

1,000,000,000

-
boda bodas my cars taxis trucks & lorries & buses
pickups
ROAD TOLL 22 DAYS PER MONTH

roadtoll total FOR 22 DAYS

7,000,000,000
6,000,000,000
5,000,000,000
4,000,000,000
3,000,000,000
2,000,000,000
1,000,000,000
-
boda my cars taxis trucks & lorries &
bodas pickups buses

ROAD TOLL TOTAL A YEAR

roadtoll total a year

7,000,000,000
6,000,000,000
5,000,000,000
4,000,000,000
3,000,000,000 roadtoll total a year
2,000,000,000
1,000,000,000
-
as s xis s s
od ar ta up se
b yc ick bu
a m p
d & s&
bo cks r rie
tru lo
A TABLE

vehicles No of vehicles
Boda bodas 70
My cars 50
taxis 30
Trucks & pickups 15
Lorries & buses 10

A PIE CHART SHOWING THE NUMBER OF VEHICLES

no of vehicles

bodabodas
my cars
taxis
trucks & pickups
lorries and buses
References

Introductory Business Statistics Alexander Bradley Holmes 2017, 13th Ed

A guide to Business Statistics David M McEvoy 2018