—enp—_—§— Moments, SKEWNESS AND KurTOSISa Business Sinn, data respectively, The moments about the mean are denoted by Greek lettc; as mu) Ungrouped Data, Consider a set of n observations X,, X,,.--- » X,, (not neces, eye ‘ai distinet) with mean X = ‘The rth moment about the mean, denote |), is defined as. Pe ra i.2,3,.... ‘Grouped Data. If X,, X,,...... X,are ee class marks of a set of grouped data wi, ‘Serresponding class frequencies foe , fg» then the th moment about the ‘mean is defined by ye> BARRA, whereN = Ef and X = ee ‘The moments abouts the Po are also called central moments. ts. 1. It may be remarked that the first central moment is always zero, For, MMments, Skewness and Kurtos 43 solution. Computation of First Four Moments x X-% (eaue 6 a 5 625 9 ae A 16 1 w 0 o 12 + 1 1 7 6 36 1296 yx -55| 2(X-X) =0 | D(x-X) -66 = 1938 We have Mean = X = ps 5 Computation of Central Moments : U(x 6 Pec "ioe = aa X(x-%) 84 X(xX-%)" _ 1938 Pa eer ioe (ms 16.8) ny = SL - EES = 387.6 Example 2, Compute the first four moments about the mean forthe following frequency distribution : i Poeciga10 15 20 25 5 4 9a 44 Business sya istiog Example 3. Compute the first four central moments for the following fre distribution: AUenoy Class interval: 0-10 10-20 20-30 30-40 Frequency cee 4 3 2 Solution. Calculation of First Four Central Moments Class Mid-vatue| i ie yy, a he Interval| | x |x |x-x | s(X-%)| £(K-X)" | A(x-%) 0-10 T 5 5 |-16 -16 256 = 4096 rs 10-20 4 15 60 -6 -24 144 - 864 20-30 3 25 «175 4 12 48 192 30-40 2 35 {70 14 28 392 5488 z a E N Eex P(X -X) SD F(x-X)|DI(X-¥) 1D s(x-7 =10 - 210] =0 = 840 =720 | = 148329 br LK 2 210) Mean: X= 45> = +> = 21 ‘The first four central moments are given by EF (X 0 DF(X-%X)" _ 840 ea 0 eee to 148320 To — = 14832. Examine whether the following results of a piece of computation forskewness and Kurtosis 45 Moments: ) Grouped Data. If X,, X,,...., X, are the class marks of a set of grouped data with © sponding frequencies f,, f,,...., f,, then the rth moment about an arbitrary point Ais given by N eee at 8rd 7-12,3, ‘the moments about an arbitrary point are also called the raw moments. ‘A Particular Case. In particular, if we take A = 0, we get rth moment about the origin, which is denoted by v,. Thus Zt v uy, Taking r= 1, we get v, = ie = X. That is, the first moment about the origin is always the mean. Remark. It may be remarked that we always have w', = X - A. For, Example 5. Calculate the first four moments about the point A= 13 for the set of numbers 6, 10, 11, 12 and 16. ‘i Solution. Computation of First Four Moments about A= 13 (X= 13P (X= 137 — 34346 Business su Solution. Calculation of First Four Moments about A = 42 Ke f X-42 | f(x-42) | six-42)? L0X= 42) f(Xmagn 20 8 -22 -176 3872 85184 4 30 | 12 -12 -144 1728 -20736 40 | 20 =2 -40 80 -160 50 | 10 8 80 640 5120 Aocegall 60, 6 18 108 1944 34992 629855 | 70 4 28 u2 3136 87808 2458694 | vey Ds (X-42) | D(x -42)" | D(x -42/° = 60 =-60 = 11400 = 21840 ‘The first four moments about the point A = 42 are calculated as follows y= DAM) 00, EA (X42)? _ 11400 _ se ¥ 60 Wa = W Euan | , . L£(X=42)? _ 21840 , _ DF(X-42)4 _ 5252390 ig = =p 7364 ay = ee 5355 For frequency distributions having class intervals of equal size h, there is « teut method for calculation of moments about an arbitrary point A. This method thatif I eee ae st four moments about the point A = 35 for the followingents, Skewness and Kurtosis 47 Moment s fue -90 Lie xn? = =-x1000 = : Bibeeatitins ap7 100 > 1125, i, . Diy ee $80 10000 ub N = 43750 44 RELATIONSHIP BETWEEN CENTRAL AND RAW MOMENTS we have already seen thats, = 0 and pi =%—A () ‘We shall now derive a relationship between j:, and h', (for r= 2, 3,.... .) expressing spin terms of Hy and vice-versa. By definition, we have _ DE(x-3)' _ Ls (x-a)" N N z and Geren fe and r=1,2,3,00.05 e2ixy _2/[x-a)-(t-al) area _ Eel 4)? 20h (x-a) +4] N = Efleaal* _ 94, ELA) (using (1) epee = wo -2uni tne =na-wP Ho-ne i48 Business Stqj Similarly, we can find the moments about any arbitrary point A from the momen, about the mean by expressing jin terms of, To find the relationship, we procecg as follows: 1 -Ay | DF(X-X+X-A) ae pas yee a yy (4) +44 (X-%) +102] N “ a pete SAUER) abe ' “ 2 = nat 2m uP = Ho tH fem, = 9) Thus Ho = ia +i? Ts(x=a)? _ Ts(X-X+X-apP _ TS[(X-*) +4]? N oy ¥ zy (=A) 315-8) 430? (x-X)-u8] % N zy? a X -X, a x ae ) +3 yp ZL ) ae es aanieae BE Hi teD = Ha +S pony + yp he aa EO oy ie ote hy eeample 9. The firs 4p and 50. Find the me solution. We are Bive computation of Mean us the mean is: X Computation of Variance Thus the variance is Computation of #, and 4, Me QP =20-4= 16 v? =20 9-3 yan + Que re 2, 20 4 = 50 40 ~ 3(20) (2) + 22) = 40-120 + 16 =-64 Wy 4 yy wh Ong we Sait 50 ~ 4440) (2) + 6(20) (2)? = 3(2)* 50 - 320 + 480-48 = 162,4.10 Business sy Moments about arbitrary point A= 67 : 2 a hs Df sn = HB x3 =0.45 uy = MLE xn T00*9 =8.73 4 és eee 4 253 ye Zhe An’ - Baar B91 py = xh" = T° x81 = 204.93 Moments about mean: 1,=0 (always) y= Wa-HT = 8.73 ~ (0.45)? = 8.73 - 0.2025 = 8.5975 Hy = Wa-S How +2ny = 8.91 - 3(8.73) (0.45) + 2(0.45)? = 8.91 - 11.7855 + 0.1823 = - 2.6932 Hy = Wa 405 Hh +6 no HP -3 ni? = 204.98 - 4(8.91) (0.45) + 6(8.73) (0.45)? - 300.45): eas : = 204.93 - 16.038 + 10.607 - 0.1230 = 199 376 Example 11. From the following data, calculate the first four moments about assumed mean 25 and convert them into central moments : 10-20 20-30 30-40 i 3 4 2 ___ [Dethi Univ B.Com. (#1) 2000, 2011 Calculation of Moments About 4 = 25nis, kewness and Kurtosis 4.11 Moments ty = Ha-HY = 90-981 Hy = H3-3h2H1+2ni> =-900-3x 90x «-3)+2xE3) = -900 + 810-54 =~ 144 y= 4-403 BL + Oud nest = 21000 -4 x (- 900) x (- 3) +6 x 90 x -3)?-3 x (-3)* 21000 - 10800 + 4860-243 = 14817. 4 4,5 RELATIONSHIP BETWEEN CENTRAL MOMENTS AND MOMENTS ABOUT ORIGIN in Section 4:4 we derived the following relation between 4, and Hy: Hy = H2-HT ny = ¥3-SHo ni +2up Hy = #4403 Hh +60 wy - Spit and so on. Here 1, represents rth moment about the mean and p,’ represents the rth moment about an arbitrary point A. If we take A=0, then / represents rth moment — we obtain My = Vo? Ts ps Von Var Va Hy = Y3-3V2v1+ 27 ay fi, = V4-4v9v1 + Gvove 3h =>4.12 = 3.6 + 4098.6- 2662 = 1441 Vy = a t4ygyy ~Gvgvi + wi = 20 + 4(1440.2) (11) ~ 6(124.2)( = 20 + 63368.8 -90169.2 + 3995 Bxample 13. The first four moments of a distribution about ‘and 45, Calculate the first four moments about mean and ongir [Dethi Unie, B.Com. (#1) 200 Solution. We are given A=4, py =l, wy 24, wy 10 a Moments about Mean : We have y, = 0 (always) b= Ma-u? «4-1 «4-163 Hy = #3 -Ship pi) + 2yi* = 10 ~ 344) (1) + 211)? = 10-12 + 2- We ™ Wa ~4u5 wy + il wf Sy" = 45 ~ 4410) (1) © 644) (1)? — 31 = 45-40+24-3+ 26 Thus the firet four moments about mean arr w* 9 B35, WO and p,~ 26 , a ere a momen ow we orn rita 194 vi = 367 = ee 28 nei-wt = 0° 208 6) ~25P = 420-250 ~ 170of? 4,0 #973 P = -25+60-16=19 py = a4 9 Hi + OH 2» 4(~ 25) (= 2) + 6(10) (- 2 = 3 2I* = 50-200 + 24¢ Thus the first four n # * 0, m6, p19 and p= 42 Moments about the value 5. Let \ ‘note the first four moments about the value S by 1} (5), #2 (5), v'y (5) and (5) respectively. If we let B= 5, then yi) = R-Bx1-5S=-4 (5) = mae [Hi(S)]'= 6° 4? =6+16=22 Fa) = #5 #34 wi(S)»[Hi(8)]” = 19 + 36) 4) «= 19-72 64 = BAT (5) = Ha +43 04 (5) + 6p (nj (dF + (wits = 42 + 4(19) {-4) + 646) (- 4)? + | 4)* = 42 - 4a. 44 Business oy, 4 {) Find the first four moments about the mean for the set of numbers 9 (i) Find the first four moments about the mean for the set of numbe 3,6. S. Find the first four moments about the mean for the following frequency dist,i,,,, xo 2 iS 5 6 8 ; ene 2 5 8 7 3 6. { Find the first four moments about the point 4 for the set of aes 17.8, 10. ery (@ Find the first four moments about the point 11 for the set of numbe,, Sara PVF. 18/714: 7. Find the first four moments about the point 15 for the following distribution se 10 14 7 20 25 Sine ag 25 2, 6 4 5 8. Find the four moments about mean from the following data. Central size of item : 2 2 3 4 5 ‘Frequency 2 2 3 5 4 1 [Dethi Univ B.Com. (H) 1995 From the following data, calculate the first four moments about mean : N= 10, Dfd =60, y fa? =1200, ¥ fa? = 18,000, > fa* = 3,60,000, ere d= X-25, four moments of a distribution about the point 4 are-1.5, 17, — 30, 108. 'Z moments about the mean. ats of a distribution about the point 2 are-2, 12, -—20 and ‘moments about the mean. Bias eeiaaact ine poine 5 are — 4) 22,\ i eesurtes ond Kurtosis pe a Mork 0-10 10-20 20-30 30-40 40-50 50-60 60-70 No. of Students 5 re 7 . a ig [Dethi Univ B.Com. (A) 1997) ANSWERS, 3K 749% Hy 1% Hy — 55). y= 705 4, (90, 9.2,~ 3.6, 122 (fi) 0, 4, 0, 25.86 5. 0, 2.88, -0.24, 19.68 6, (92, 13.2, 59.6, 330 (i) -0.4, 9.6, -23.2, 160.8 4, 1.75, 27.55, 146.05, 1786.15 8. 0, 1.2625, -0.2129, 3.8758 9, 0,84, 72, 14832 10. 0, 14.75, 39,75, 142.3125 11, 0,8,36, 180 12, (90,6, 19, 32 (iI, 7, 38, 145 13. 10, 116, 1644, 23184 14, 0.5, 15, 62,244 15. 0, 59.993, -49.644, 8356.04 16. 11,=0, H,=120, p3=0, 44,= 36000 47. 0, 9.92, -0.8761, 235.268 18. 0, 177.39, 47.982, 95009.3637 4,6 SKEWNESS In this section we shall discuss a very important characteristic of a frequency distribution, viz., skewness. Skewness means lack of symmetry or departure from sry of a distribution, In other words, if the frequency curve of a distribution is not symmetrical, the distribution is said to be skewed or to have skewness. Ifthe frequency curve of a distribution has a longer “tail” to the right of the central maximum — than to the left, the distribution is said to be skewed to the right or to have po : ss (Fig. 4.1 (a). On the other hand, ng of the central maximum than to the right, the d butic to the left or to have negative skewness [Fig. 4.1 (b)].a 4.16 Business s tatistc For symmetrical distributions the mean, mode and median all coincide (s ig. 4.9) Tests of Skewness In order to ascertain whether a distribution is skewed or not, the following tesig may be applied. Skewness is present if : (i) The values of mean, median and mode do not coincide. (i) Quartites are not equidistant from the median. (iti) Sum of the positive deviations from the median is not equal to the sum of the negatiy deviations. (i) Frequencies are not equally distributed at points of equal deviations from the mode () The frequency curve of the distribution is not a symmetric bell-shaped curve but itis stretched more to one side than to the other. 4.7 MEASURES OF SKEWNESS Measures of skewness tell us the direction and extent of skewness. These can be classified as follows : () Absolute measures of skewness. - (ii) Relative measures of skewness. Absolute Measure of Skewness. For skewed distribution, the mean tends to lie on the same side of the mode as the longer tail (see Fig. 4.1), The more the mean from the mode the greater is the departure from symmetry, Thus a skewness can be supplied in absolute terms by the difference (Mean -\ skewness and Kurtosis ao aan, Sheu KARL PEARSON’S COEFFICIENT OF SKEWNESS. Karl Pearson’s coefficient of skewness, denoted by Skp, Me is defined as pefinition: Sk, = Mean — Mode ?” Standard Deviation we skewed distribution [see Fig. 4.1 (a)] has a longer tail to the right of the aximum than to the left. In other words, the mean is greater than the mode Skp is positive. On the other hand, a negative skewed distribution [see fig 4:1 (8) has a longer tail to the left of the central maximum than to the right. In wer words, the mean is smaller than the mode and thus Sky is negative. For a vmmetrical distribution, Sk, is equal to zero. Hence departure from zero will imply theextent of asymmetry : a positive value of Sk, means positive skewness anda negative paluemeans negative skewness. ‘the formula given by Karl Pearson can not be used when the mode is ill-defined. To avoid use of the mode in such cases, we can employ the following empirical relation between mean, median and mode : Mean - Mode = 3 (Mean - Median) and define coefficient of skewness (Pearsonian) as 3(Mean - Median) ‘Standard Deviation Remark, Theoretically, Karl Pearson’s coefficient of skewness varies between +3, ‘however, in practice, it is rare that this coefficient exceeds +1. Example 16. For a certain distribution, the mean is 200, mode is 195.2 and deviation (S.D,) is 16. Calculate Karl Pearson’s coefficient of a posit central mé ‘and thus2 IDX? (DX) _ |144280 SD. = (24) - 20 ¥7214-5270.76 = ¥1943.24 = 44 0g Mean ~ Mode wv Skp = 5D. Example 19, The sum of 20 observations is 300, its sum of squares is 5000 ang median is 15. Find the coefficient of skewness and coefficient of variation [Delhi Univ, B.Com. (2) 2997 Solution. In terms of usual notations, we are given : n= 20, YX =300, yx? =5000 and Md=15 ee 200 py Mean) Kea A = By 15 2 and SD.= (8? " 2000 (15)? = 4250-295 = \05 - 5 4: Coefficient of skewness is given by = 3(Mean - Median) _ 3(15-15 SD. 5 = Mean *10° = 5 *100 = 33.33%, ra certain distribution, the arithmetic mean is 50, mode is 44 and ic f skewness is Calculate the 8.D. of the distribution. vttbieieicap hy «. 5(skewness and Kurtosis 4.49 noments: 3(Mean ~ Median) Skp* Standard Deviation 40 40 ~ ye 22. For a moderately skewed distribution of supply of product A, arithmetic ;5 100 and coefficient of variation is 35%, Pearsonian coefficient of skewness is 200-170) _ 90 an is a find the mode and median. [Dethi Univ. B.Com. (H) 2013] Mememieere 2: Mean 100, CV,-35% end Skp= Oi 6 = £x100 ce dl av= 35=7oex100 = o=95 Skp= > 7= 100- Mode or Mode = 93 2 To find the median, we use the following empirical relation between mean, mode and median mean-mode = 3(mean- median) > 100-93 = 3(100- median) a 7= 300—3{median) = — median = 29-1 - 97.67 Example 23. Calculate mode and median from the following information : karlPearson’s coefficient of Skewness = + 0.32, Standard Deviation = 6.5, Arithmetic Mean = 29.6 [Delhi Univ. B.Com. (H 1998) Solution. We are given : Sk, =0.32, 0-65 and X =296 aie Mean - Mode 29.6- SD. “_. 4.20 Busine. Example 25. For a certain distribution, the arithmetic mean is 45, media, and Karl Pearson’s coefficient of skewness is ~ 0.4, Calculate : (i) the mode, S.D., and (iii) the coefficient of variation. Solution. We are given : Mean = 45, Median=48 and Sk,=-0.4, (i) Computation of Mode. The mode can be determined using the empirical relation ; Mode = 3 Median - 2 Mean = 3 (48) - 2 (45) = 144-90 = 54 (ii) Computation of S.D. The standard deviation can be obtained using the for 8 Statist i) the following mula for Pearson’s coefficient of skewness : - ‘sk, = Mean = Mode - SD. _ Mean - Mode _ 45-54 _ Sa Skp eommeso.4 = 22.5 (iti) Computation of C.V. : The coefficient of variation is given by ev? x100 = 223.100 = 50%. Mean Example 26. Karl Pearson’s coefficient of skewness of a distribution is 0.5. ‘The ‘median and mode of the distribution are, respectively, 42 and 32. Find : { the mean, (i) the S.D., and (ii) the coefficient of variation, ea e [Dethi Univ. B.A. (Econ. Hons.) 2000) on. \ _ Skp=0.5 Md=42 and Mode = 32 fean : The ™mean can be determined using the following Mean - 32 = 3(Mean - 42) ‘be obtained using the formulaand Kurtosis Fe, hy the distributions have the same degree of skewness, False? Comment giving reasons. [Delhi Univ. B.Com. (H) 2008, 2018] i) To compare the degree of variation, we compute coefficient of variation (aj Bot! qrue/ solution: ( cv: Seon Mean 100 GV, (A) = x100 = 10%. SD. 10 CV. (B) ee 100 = 55 %100 = 11.11%. since CV.) is less than C.V.(B}, therefore distribution A has less degree of variation than distribution B, Hence statement () is false {To compare the degree of skewness, we compute coefficient of skewness (Sk,): 3(Mean - Median) _ 3(100-90) Standard Deviation ~ 10 Skp(A) = =3 _ 3(Mean - Median) 3(90-80) _ Si-(9.- Standard Deviation! 4 aaa both the distributions have the same degree of skewness. Hence statement (f) ai Thus, is true. Example 28. Pearson’s coefficie: nt of skewness for a distribution is 0.5 and coefficient ofvariation is 40%. Its mode is 80. Find the mean and median of the distributi on B.Com. (B)i Business Sais, 9 Beer = o-2 4 = 50=Mode Also, " : Mode = 50 + 0.4 x 20 = 58 Thus, the mode of the distribution is $8, To find its median, we employ the fly, empirical relation between mean, median and mode: mean - mode = 3{mean - median) > 50-58= 3(50- median) = 150 ~ 3 median = Smedian= 150+8=158 = median= “29.5. Example 30. Calculate Karl Pearson’s coefficient of skewness from the foloyjn data : ie Size Bp 2 3 4 5 6 1 Sega go 18 30 25 12 8 2 [Dethi Univ. B.Com. (P) 1984 Solution Computation of Karl Pearson's Coefficient of Skewness “| Frequency () a=X-4 ft ff Pascale -3 =30 90 ao i) 236 72 Bu ees as Fao 30 ws ai. 9 0 Baws | a ee io i + Mel gh 4 2 a 6 12 bs Be! | 6 18 bs Did=—72 Yifa? = 234 gape. 4 72= 3.28 oa Bose 1.3497sgrewness and Kurtosis 4.23 nts e a, We shall first calculate the mean, mode and standard deviation, For this a the following table we pr Calculation of Mean, Mode and Standard Deviation Midaiue | Frequency | u=2>4 fu fie x sf (A = 105, h= 10) 7 12 -3 -36 108 85 18 -2 -36 2 95 35 -1 -35 35 105 42 0 oO 0 115 50, 1 50 50 125 45, 2 90 180 135 20 a 60 180 145 8 4 32 128 N= > f =230) LY sur is | ¥ fu? =753 ‘Galeulation of Mean. The mean is given by the formula Mean = ardbtcn = 105+23x10 = 105 +5.43 = 110.48 calculation of Mode. The class corresponding to the maximum frequency, 50, is 110-120. Thus the modal class is 110 - 120. The mode is given by the formula : 1 = lower limit of the modal clas: = frequency of the modal classan tt Glossar ISHIS4 15180 7140-104 148-149 180-164 185-159 Leo, Frequency 8 12 2 28 19 1a 2029) thiy [Dethi Univ. B.Com. (xp » Solution. We shall first caloulate the mean, mode and standard deviation. jy, We prepare the following table ; Calculation of Mean, Mode and Stand: | Deviation 129,5=134.5 134,5~=139,5 139,5=144.5 1445-149, 149.5 -154,5 | 154.5 -159.5, as E1o S lean = AE fan sure hxs = 1472 fe Ome corresponding ie maximum frequency, 28, is the sal Glass is 144.5 - 149.5. The mode is given by theewness and Kurtosis za nts, Ske x je 99. Calculate Karl Pearson's coefficient of skewness on the basis of mean, pram 4 standard deviation from the following data ode ue 0) im 4 ag! gy aes id oo" a ‘ 8 14 18 3% 30 20 10 a Note that values of X are mid values of the class intervals 6 - 18, 18 - 30, Bae), fand soon. To find skewness, we prepare the following table : S Calculations for Mean, Mode and S.D. x f. (A=48,h=12) fu fe 6.18 12 8 -3 -24 72 18-30 24 4 -2 -28 A 3-42 36 18 -1 -18 18 40-54 48 36 ° 0 a Bee 60 30 1 30 30 66-78 72 20 2 40 80 78-90 4 10 3 0 90. N= Df = 136 Lfu =30| Pfur= aleulation of Mean. The mean is given by the formula N on of Mode. The class corresponding to the max tl 42 — 54 is the modal class. The m 30 ; jp RL 48+ 756712 aio 5aa 4.26 Busine: Thus, the Karl Pearson’s coefficient of skewness is given by Mean-Mode _ 50.647-51 -0.353 ati eke ommiieesiecssy 6955 “70-019 Example 34. The daily expenditure of 100 families is given below Daily Expenditure : 0-20 20-40 40-60 60-80 80-109 No. of Families e 13 7 mae ie 16 If the mode of the distribution is 44, calculate the Karl Pearson’s coctticieny : skewness. [Dethi Univ. B.Com. (ry 1985 Solution. We shall first find the missing frequencies. | Daily Expenditure No. of Families _ 0-20 13 Bul, 20-40 h 40-60 A227 © Modal class 60-80 Ps as 80-100 16 i N= Df =56+h+f, N=2f-100 ie, 56+f,+f,-100 > f+f, =44 u(t) is given to be 44, which lies in the class interval 40 - 60, therefore 49 - . Applying the following formula for computing mode :As ss, Skewness and Kurtosis a is “3 sation of Mean. The mean is given by the formula catet! S Mean = arrdich = 5047220 = 50 culation of Standard deviation : cat 2 71> 2 ——— Dful (lsu j1eo_(_o . Er (9) x20 = 1.265 x 20= 25.3 SD. me ~ 700 ~(ioo) *20 = 1-265%20 Mean-Mode _ 50-44 _ 9997, gust Pearson’s coefficient of skewness = SE = B8 sero 96, Calculate Karl Pearson’s coefficient of skewness from the following es gflakhs) : Below20 40 60 80 100 rnofCompanies : 8 20 50 64 70 given Jess than’ cumulative frequency distribution is first converted frequency distribution as shown in the following table : solution. The jpto an ordinary Calculation of Karl Pearson’s Coefficient of Skewness Profits | Mid-value x 10 304.28 Busine Karl Pearson’s coefficient of skewness is given by Mean-Mode _ 49.43-50.59 Sky 2163 21.63 ~~ 9-054 Example 36. Calculate Karl Pearson's coefficient of skewness from the following day GMAT'Score(morethan) : 0 100 200 300 400 500 600 70) sy) No. of Students : 150 140 100 8 80 70 30 14 [Meerut Univ., B.Com. 2003, Lucknow Univ. MBA, 200. Solutfon. The given ‘more than’ cumulative frequency distribution is frst conven, into an ordinary frequency distribution as shown in the following table ed Caleulation of Coefficient of Skewness Mid-vatue|u= ~=359 |, of. X__|ia-350,h= 100] 10 50 -3 30 00 50 150 -2 | -80 160 20 70 250 = -20 20 a) -80= 0 70 350 0 0 0 | 80-70=10 450 1 10 10 550 2 650 3 4 distribution. Hence we shall of skewness :zewness and Kurtosis 4.29 n of Standard Deviation. The standard deviation is given by : sf? (Ee), _ eos o-yn \w) Viso = 5.387 - 0.182 «100 = 5.205 x100 = 298.14 sation of Coefficient of skewness. atu! es 3(X-Ma) _ 3(392.67-450) _ ‘Skp = o 228.14 228.14 nei Ody {150) x100 SAO -_ 0,754, icating that the distribution is negatively skewed. maple 37. You are given the position in a factory before and after the settlement Fo industrial dispute : Before Dispute After Dispute No.of Workers a ae ‘wean wages (2) 220 230 ‘Median Wages (8) 250 240 standard deviation (2) 20 6 Compare the position before and after the dispute in respect of A (jTotal wages, (i Modal wages, (ii) Variability, and (iv) Skewness : [Dethi Univ B.Com. (H) 2006, 2012, 2019 (Modified) NX = 3000220 = %6,60,000 Be4.30 Example 38. You are given the position in a factory before and after ; of an industrial dispute. Comment on the gains or losses from the pc workers and that of management. Before No. of workers 2500 ‘Mean wages (2) 2 Median wages (®) i 0 Standard deviation (2 24 20 Solution. The following comments can be made on the basis of the infomay * ia 8) Comparing number of workers. The number of workers after the dispuye, decreased from 2500 to 2400, This isa definite loss tothe persons throxy. retrenched, Itmay also bea loss to the management if their retrenchment n° the efficiency of work adversely. a (i) Comparing total wages paid. Total wages paid by the management bein dispute = 2500 x 91 = 2 2,27,500 oe i _ Total wages paid by the management after the dispute = 2400 x 95 = 22,28 099 | ____ Thus, the total wages paid by the management have gone up after the settlement se eet the number of workers has decreased from 2500 to 2400 the fact that the average wage has increased after the dispute - ‘Wages paid by the management should not be viewed as t > have definite reasons to believe that the ‘gone up after the dispute. after settlement of the dispute at formerly 50% of workers useduness and Kurtosis a eo we jgence to conclude that wages are more uniformly distributed after the “em ent of dispute. In other words, there are less disparities in wages after as spute is settled. ie comparing skewness : We shall calculate Karl Pearson’s coefficient of skewness a ven BY = Mean-Mode SD. 91-106 Skp (before dispute) = =*57°° -_ 9.695 Skp(after dispute) = « the distribution is positively skewed after the settlement of dispute whereas it ae negatively dispute before the settlement of dispute. In other words, the number eorkers getting low wages has increased considerably and that of workers getting high wages fallen. 1, What is skewness? How is it different from dispersion? State various measures of skewness. [Dethi Univ B.Com. (P) 1987] 4, Distinguish between a symmetrical and skewed distribution. [Dethi Univ B.Com (#) 2005] 4, State the empirical relationship among mean, median and mode in a symmetrical and moderately asymmetrical frequency distribution. How does it help in estimating mode (Dethi Univ B.Com (H) 1983] between positive and negative skewness. of mean, median and mode in each(vid Ina symmetrical distribution, we have mean = median ¢ moc (vii) Skewness cannot be calculated in a bi-modal distribution (2) The odd moments in a symmetrical distribution are zero, () Ina positively skewed distribution, mean > median > mode. 9. () Foracertain distribution, the mean is 50, mode is 48 and stan 20. Calculate Karl Pearson’s coefficient of skewness. (i) Fora certain distribution, the mean is 45, median is 48 and standar gay, is 22.5, Calculate Karl Pearson's coefficient of skewness, ii (ti) From a moderately skewed distribution of retail prices for men’s shiny found that the mean price is 720 and the median price is 817. If the cam of variation is 20%, find the Pearsonian coefficient of skewness) ¢ distribution. : [Dethi Univ. B.Com (P), 1986, 1987, 2002) 10. (3) The sum of 50 observations is 500 and the sum of their squares median 12. Compute coefficient of variation and coeficient of skew [Dethi Univ. B.Com, (i) The sum of 10 observations is 452, the sum of their squares is 24 ___ #8 43.7. Find the coefficient of variation and coefficient of skewness. 11. Calculate the value of standard deviation if X =45, Mode = 48 and coefficient of skewness Loa [ethi Univ. B.Com. () 2004 12. Ina certain distribution, the following results were obtained : ____-X =45, Median = 48, Coefficient of skewness = — 0.4 who gave you this data failed to give you the value of standard deviation, d to estimate it with the help the available information, i s.. [Dethi Univ. B.Com: (i 1997, of skewness for a distribution is 0.4 and coefficient of variation is find the mean and median. [Delhi Univ. B.Com. (H) 1997] rson's coefficient of skewness is ~ 0.6, Coefficient of $ 6000 ang ) 2000, 70 and modeeewness and Kurtosis 453 pret "ulate Katl Pearson's coctficient of skewness from the following data 1p me xin C70 ) less than) 2 3 4 9 6 7 ycond panies 5 2 4 6) 83: 9100 coefficient of skewness from the following sylate Karl Pearson's © 20 wages fngimorethan) = = a 2 . yo. of workers Poe jven the following information in a factory before and after the settlement of are gi a 1s dustrial dispute : Before dispute ‘After dispute oof workers 7000 950 ‘Mean wages (7 308 325 Median wages (9) 320 300 standard deviation (®) 25 20 tgmpare the position before and alter the dispute in respect of Ral wages, (i) Modal wages, (ii) variability and (iu) skewness ‘are given the position in a factory before and after the settlement of an industrial You 22, vate. comment on the gains or losses from the point of view of workers and that of Before dispute [After dispute 2400 2350 455 475.~~ 7 As BQ, (} Total wages = €1,09,200 (before), €1,11,625 (after) {Modal wages = 853 (before), G40 (alter) (WV. * 26,979 (before), 21.05% (after) {WY Sky = 0,625 (before), 0.75 (after) 4.9 BOWLEY’S COEFFICIENT OF SKEWNESS In this section we shall discuss another measure of skewness, which ig de, terms of quartiles, For a symmetrical distribution, the first and the thing are equidistant from the median (see Fig, 4.3). ; Q Median Qy However, if the distribut oc q tribution is skewed to the right, then the third quartil farther from the median (Q,) than the first quartile (Q,) is from the Fret BO > ®-Od Kurtosis 438 skewness an 35 at yore” gt be remembered that the numerical values of coefficient of skewness d by Bowley’s method and Pearson’s method are neither comparable nor ey bear any relationship to one another but, on rare occasions, with do \sually shaped distribution, it is possible for them to emerge with opposite ul It B ptaine signs , s 39, Calculate Bowley’s coefficient of skewness for a distribution having Q, sag and Q, = 70 a Bowley’s coefficient of skewness is given by solution y Q3+Qi=202 _ 70+30-2(38) _ 24 Sky = ye 2 Oe ee ae z Q3-Q1 70-30 lu sample 40. Given Q, = 18, Q; = 25, Mean = 18 and Mode = 21. Calculate Bowley’s ient of skewness. [Delhi Univ. B.Com. (P) 1999] solution. To find Bowley’s coefficient of skewness, we also need median, which can fe obtained by using the following empirical relation between mean, median and mode: Mean - Mode = 3 (Mean - Median) substituting mean = 18 and mode = 21, we obtain y 18-21 = 3 (18 ~ Median) = 54-3 median s 3Median = 57 or Median = 19 + Bowiey's coefficient of skewness is : gi, = Q2*O1=20p _ 25+18-2(19) 5 _ Bi 3-0 25-18 7 Find the coefficient of skewness from the following informat two quartiles = 11 Sum of two quartiles=25 _ Mode= 10 and Mean=13 [Dethi 0714,4.36 Busine Solution. The coefficient of skewness based on quartiles is given by Q3+Q) -2Median Skp Q3-O1 Substituting Sk,=0.6, Q, + Q, = 100 and median = 38 in the above fos, obtain a 100-2x38 _ __24 =o) = 24 Maan Os= Ciel 05-01 2 &%- OG - 4 Solving Q,+Q,= 100 and Q,-Q,= 40 simultaneously for Q, and Q,, we obtain Q, = 70 and Q, = 30. Example 43, For distribution, Bowley’s coefficient of skewness = -1.3, Viedian -- and the value of the third quartile is three times the value of the first quaya” Caloulate the quartile coefficient of dispersion. [DeThi Univ. B.Com. (1 205 Solution. Bowley’s coefficient of skewness is given by S| Q3 +Q;-2median i pear 23-2 Substituting Sk =-1.3, Q,=3Q,, and Median = 56 in the above formula, we obtain pee 3Q +Q) - 2x56 x 4Q) -112 30, - 1 20) -2.6 Q, = 40,-112 or 6.60, = 112 ledian = Q3= 3Q, = 3 x 16.96 = 50.83 Q3-0) 5088-1696 33.99 03 +01 ~ 50.88+16.96 = 67.94 =0-5- could have been solved directly without using Bowie's follows : a4 ao =0.5.igpeunaee ond Kurcos’ “— _weare given Mean = 42, Mode= 36, Q.D.=15, and Sky* 1/3 sotstot al relationship between mean, mode and median is in i Mode = 3 (Mean ~ Median) ue es of mean and mode, we obtain the valu guest’ sah : a - 36 = 3 (42 - Median) a = 40 (on simplification) * a o- Qs=O 2 we QD. > =15 => Q-Q,=30 (I) 1 Q3+Q,-2Median _ 1 Bhs" 3 ne purther, o° 3 =O 3 80 1 ¥ Bra-= B= %F A= 90 (2) ovine Bas. (1) and (2) simultaneously for Q, and Q,, we obtain Q,= 30 and Q,= 60. 46, The marks obtained by 9 students in a class are 25, 20, 15, 45, 18, 7, “38 and 12. Find the quartiles and Bowley’s coefficient of skewness for the given. a solution. Arranging the marks in an increasing order of magnitude, we get 2 15 18 20 25 38 45 :\ ness 9, 4.38 Bus Solution, Calculation of Bowley’s Coefficient of Skewness iy FSaa al S N= Df =80 Computation of Q,. We have a. = 20.95; and the cf just restr ten, equal o 20.25 i635. The cane value of Xis 7. | ‘ Q=7 Computation of Q,. We have aad - = 40.5; and the off just greater than» equal to 40.5 is 47, The meee value of Xis 8. Q=8 (N a tation of Q,, We have pe = 60.75; and the cf. just greater than o isn. The ¢ ea value of X is 10.p 15, sreuness and Kurtosis _N+1_ 96 tation of Q1- We have “4” = “7 = 24, and the c.f, just greater than or equal 43, The corresponding value of Xis 2 rts Bee 5 N+1_ 96 tation of Median. We have ~>~ = => = 48; and the of. just greater than or g is 58. The corresponding value of Xis 3 qual o Median = 3 ‘ Rater 3(N +1) computation of Q3-We a a -, 76. The corresponding value of Xis 4. p72is ee 45 coefficient of skewness is given by = 72; and the o,f. just greater than or equal |, Bowley” s Sk, = Q3 +Q1=202 _ Q3-Q1 srample 49. Calculate Bowley’s coelficient of skewness from the following data: ee + O10 10-20 20-30 30-40 40-50 50-60 60-70 70-80 80-90 ieee tl 18 25 2880.88 Be la Calculation of Bowley’s Coefficient of Skewness Cumulative frequency chi ea2 Stats, 4.40 equal to 102 is 112, The class corresponding to this c.f. is 40-50. aa 2 is 40-50. Thus tay we Gite 4g 102-80 82 *10 = 46 67 Computation of Q, .We have 3” = 153; and the cf just greater than o, ca 153 is 167. The class corresponding to this c.f. is 60-70. Thus ia oe i SHLA=€ a 60-158 22 X10 = 63,64 Bowley’s coefficient of skewness is given by Q3 +Q1 = 202 Q3-Q1 Substituting Q, = 28.8, Q, = 46.67 and Q, = 63.64 in this formula, we obtain 68.64 +28.8-2(46.67) __-0.9 Sk, = Ska" 63,64-28.8 __ ~ 34.84 ~~ 0.025. Example $0. Calculate Bowley's coeficient of skewness from the following date Monthly Sales (? Lakhs) No. of Firms P| Tessthan 20 s given ae rm of cumulative frequency distribution, a juency distribution as shown in the1, skewness and Kurtosis: 441 jet ‘ : ph gi ctlte Os 25-8 j Fh = 20425-8,.99 =20 + 17 =37 N 100 Zs computor of Qz- We have “> = —5~ = 50. The class 40 - 60 contains Q, which by vet 2-C + S @-! anne xh = 404+20=28 59 454880488 chee at aputation of Qx We have ~~ =75. The class 40-60 contains Q, which is given : +B = h=40 ee P+ «20 = 40 + 18.8 = 58.8. Qe poviey’s coefficient of skewness is given by +Q)-2 58.8+37-2(48.8) eae ae 3 meqesBaa% ! FSi oa sxample 51. Calculate Bowley’s coefficient of skewness from the following data: ‘Income per day (in &) (more than) scat 50 60. 70 80. 90. {ia of workers +186 167 192 eA [Dethi Univ. B.Com. (P) 1994] ‘Soution, Calculation of Bowley’s Coefficient of Skewness _ No. of Workers442 Ma = AEE = 60+ 28-9410 = 60+ 8.125 = 68,195 Computation of Q,. We have 5 = 139.5; and the ef just greater than org 199.5 is 148, Thus the class 70 ~ 80 is the Q;- class. 2 Qs SMC, = 79+ 1805-10? «10 - 70 + 8.15 = 78.15 Bowley’s coeflicient of skewness is given by = Q3+O1=202 _ 78.15+57.85-2(68.125) = 136-136.25 Ske ae lene, 78.15 -57.85 20.3 Nal ty 0012, Example 52. Calculate Bowley’s coeflicient of skewness from the following data Capital in crores of): 1-5 6-10 11-15 16-20 21-25 26-30 31-35 peti 27929) 38" 48 5370 [Gujrat Univ. B.Com. (P) 2004 data is given as a grouped frequency distribution with inclusive st step involved in computation of quartiles (and hence coefficient the given data into a continuous frequency distribution ‘classes as shown below: ‘Less than’ of. 20ness and Kurtosis 4.43 noe N/2-C yy = 205 —; x5 =20.5+2,97 =23 wa 20.5 + 2.97 = 23.47 3N ion of Og We have “7- = 213.75; and the c.f. just greater than or equal to 15. Thus the corresponding class 25.5 - 30.5 contains Q, which is given 13758 y EO 213.75 ~ Pe Steen = 255 + 2873-162 5 = 25.5 + 4.88 = 30.38 4 syscoetcent of skewess i given by pees f= 202 _ 30.38 +14.68-2(23.47) Saeco Sk =~ 03-1 30,38 -14.68 "757 eee 1¢ 53. Given below is the distribution of daily wages earned by one hundred Bixers of 2 factOTY. aes O No, of Workers Daily wages (3) _| _No, of Workers 195-175 12 375-425 10 175-225 16 425-475 6 225-275 25 475 - 525, 3 275-325 14 525-575 1 | 395-375 13 d the values of three quartiles of the above distribution. d the absolute measures of dispersion and skewness based et all the five measures that you have calculated in (9 "Calculation of Quartiles and Coefficient ¢ san aay Re as4.44 Busine Q- wae sh a 175+ 28-2 «50 175 + 40.63 = 215.63 eee LO0) ha, Computation of Q,. We have > = 9° = 50; and the c.f. is just greate; than op equal to 50 is 53. Therefore 225 - 275 is the Q, - class. eS 20-28 550 = 205 +44 = 269 @, = 4+ N2=C,, = 205+ Be Computation of Q,. We have 2X. = 75; and the ef. just greater than or eqy al to 75, is 80. Therefore 325 - 375 is the Q, -class. oe ot ae 4 325 + 78-87 ,.50 = 325 + 30.77 = 355.77 (ii) Computation of absolute measures of dispersion and skewness ee on ee BES2Si05 15.63 _ 75 97 Skewness: Absolute Skewness = Q, + Q, - 2 Median = 355.77 + 215.63 -2 (269) = 571.4 - 538 = 33.4 _ (iti) Interpretation of measures. The value of first quartile is 215.63 which means _ that 25% of the workers in the factory received wages that were less than 7215.63 "The value of second quartile (or median) is $269 which means that 50% of workers which were less than 8269 and 50% received wages that were more + Q.D. is equal to Q,, and median rmed as normal or symmetrical.s and X a csenres* maniquartle pest quartic Computation of Karl Pearson's coefficient of skewness Place A 3(Mean - Median) SD. Stet 3 150-142) _ 95 30 Mave H 0 188 100) wo Place Ht Sk,« §{(Mean = Median) SD. S(140= 185) { l. 0,82, conputation of Quartile coefficient of skewness Place B Place A Q3 +Q)-2Ma Se> 3-01 x 195+62-2(142 195 -62 257-284 _ -2' escue. 193 zt =-0,203, y+ Q)=2Ma Sky = "03-91 . 260+ 80~2(155) 260-80 340-310 | 30 a 180—— Business 4.46 Ines Say Example 55, Calculate Kelly's coefficient of skewness from the following ga, Marks + 0-10 10-20 20-30 30-40 40-50 50-60 60. No, of Students : 8 12 20 30 15, 10 . Solution. Calculation of Kelly’s Coefficient of Skewness Marks No, of Students Cumulative Fre 0 (ef) 0-10 8 8 10-20 12 20 20-30 20 40 30-40 30 7 40-50 15 85 50-60 10 95 60-70 5 100 | N= a ‘f= 100 Computation of Pg. We have {ou = 10. The of just greater than or equal to 10g 20, Hence the. corresponding clase 10-20 contains P,, which is given by ma = 10+ We have © 7 = 50. The cf. just greater than or equal to 50 es in the es 30-40. x10 = 10+ 1.67 = 11.67 10-8 12Kurtosis is, he 1 cuish between Karl Pearson's and Bowley’s measures of skewness. ~ [Dethi Univ. B.Com. bem ate whether the following statements are True or False & Nip Ina skewed distribution, the first and the third quartiles are equidistant from the median the limits for Bowley’s coefficient of skewness are + 1 ifthe distribution is skewed to the right, then Q, + Q, < 20) fa} A longer tail to the left shows postive skewness in the distribution iu) Skewness measures the degree of peakedness or flatness of a distribution. calculate Bowley’s coefficient of skewness for a distribution having Q, = 62, Q, = 142 an 3" 195. 4 fora certain distribution, the mean is 26, mode is 20, the difference between two & “artles is 20 and the sum of two quartiles is 44. Calculate Bowley's coefficient of skewness: na frequency distribution, the coefficient of skewness based on quartiles is 0.5. If the sum of the upper and lower quartiles is 28 and the median is 11, find the values of lower and upper quartiles. Also find the coefficient of quartile deviation. [Dethi Univ. B.Com. (H) 1987, 2019) Ina frequency distribution, the coefficient of skewness based on quartiles is - 0.4. If the first quartile is 8.6 and the median is 12.3, calculate the quartile deviation. : [Dethi Univ. B.A. (Econ. Hons.) 1996] _ Calculate coefficient of quartile deviation and skewness for a distribution having Q, = Median = 18.8 and Q, = 25.2. quartile coefficient of skewness is 0.6, quartile deviation is 20 and the first | the median of the distribution. «casi i % 84.48 it, 18. 19, ey ay 1. Particulars relating to the wage distribution of two manufacturing firms are given gg From the following data, compute quartile deviation and coefficient of skewness 3 bg ‘on quartiles : "BSeq Size : 5-7 8-10 ip=igs 14-16 17-19 ‘Frequency : 14 24 38 20 4 [Delhi Univ. B.Com. (29, Calculate Bowley’s coefficient of skewness from the following distribution | Agebelow(inyears: 25 30 3 4 4 80 55 No.ofemployees : 8 2 40 65 80 2 10 [Dethi Univ. B.Com. (p) 2004 Caleulate Bowley’s coefficient of skewness from the following data Sales (® crores} (less than) : 50 60 70 80 90, No. of companies BMPS 200640) «65 80 [Dethi Univ. (FMS) MBA, 2099 Caleulate Bowley’s coefficient of skewness from the following data : Marks(morethan): 0 15 30 4 6 7% No.ofstudents : 180 160 130 10 65 2 Fy [ea Firm FirmB [Dethi Univ. B.Com. (Hj 2005, and after an industrial dispute:90, Coefficient of O.D. = 0.43 9. 0.266, 0.207 10. 38 hh = 64 13, 2," 24.25, 0, = 33, Q,= 44, Sky= 0.114 0,032 16. 0,058 0,192 18. 0,048 19. -0.111 C.Y, (firm B) = 10.56, Sk, (firm A) =~ 0.25, p(firm A)= 0.615, Sky (firm B) = 0.947 before dispute) = %1,11,000, Total wages paid (after dispute) «© 1,04,000, , (before dispute) = 7.03%, CV. (after dispute) = 10%, Gaapefore dispute) 0.692, Sk, (after dispute) = 1,58, Sk, (before dispute) £0,176, Sky (after dispute) = 0.5 ait MOMENT COEFFICIENT OF SKEWNESS ae js another measure of skewness based on moments which we define below. pefinition. Pearson’s f,-coefficient, also called moment coefficient of skewness js defined as 2 = 1s at Psa al distribution, the third moment about the mean is zero. Hence f, = ater the value of f,, the more skewed is the distribution. However, the a measure of skewness has a serious drawback. It can not tell of skewness, i.e., whether the skewness is positive or ‘simple reason that, whatever 1, may be, 13 is always p 1180 positive. This drawback has been taken care of by | Pearson’s y, -coefficient, which is D Dn’s 1,-coefficient is defineBi 4.80 Busing Note that the distribution is oo. skewed to the right. le 58. The first three moments of a distribution about the value | ,,, 2 nd 80 respectively, Find its mean, standard deviation and the moment rn... skewne: [Delhi Univ B.A. (Econ. Hons, apt Solution. Weare given: 1", = 2, ji’, = 25, p',=80 and A=) Computation of mean wu Wi = X-A => K wp+A=2+1-3 ‘Thus the mean is X = 3, Computation of Standard deviation variance = auamegnene 275-4) bedi = Wariance = /21 = 4.58 Gomputation of moment Re of skewness Wehave 41, = p'y~Sy'pu', + 2uY = 80-3 (25) (2) + 2(2)° = 80-150 + 16-54 f 996) Hg -54 Body Se ae ise (21°? 96.23 Sees eetiel moments are 9 and—2 the second and third central moments are se ‘more skewed to the left?and Kurtonls a ne Ny f n= 0 rie = 0,3 Hae = 0.3 vid (0.64)"/ we" Wy i Osi" °° fly = 0.3 0,512 = 0.1536. Fgsdeentral moment of the distribution is 0.1536 a ws 1 the following, data, compute the moment coefficient of skewness fe 61, Give! n the result [Dethi Univ. B.A. (Econ. Hons.) 1993) ent 0 sa wen , 2 5 vt 8 10 Calculation of Moment Coefficient of Skewness gut (x=)4.52 Bisinen « is, >= SD. = et = ¥14.75 = 3.84 384.100 SP. .190 = = 153.6%. aye Neh (ti) Calculation of 8, : We have py = n'y Sn'gyy + 2y'8 =- 30-3 (17) 1.5) +2 1.5) = -30+76.5-6.75 = 39.75 BE _ (89.75)? _ 1580.06 ome (irs), | $202.05 (tii) Calculation of first three moments about origin The first three moments about origin are given by “ = X (always)=2.5 = fy + VP = 14,75 + (2.5)? = 14.75 + 6.25 = 21 os Hg + 3vqv,— 2vP = 39.75 + 3 (21) (2.5) - 2 (2.5) = 39.75 + 187.5 - 31.25 = 166. following measures were computed from a problem in Statistics 83, Arithmetic Mean = 74 and Median = 77 3 By = 0.492.skewness and Kurtosis, 4.53 - 43 h 5 eect i = fe Wy 20) i" ty = 03 xy, vO) gence the aver Sapte is negatively skewed, y, < 0, Therefore, using (1), We ge that ty < 0. Thus it is not possible for the given distribution to have & positive third central moment. az KURTOSIS xurtosis isyet another measure which tells us about the “peakedness” of a frequency, fstrbution, The degree of peakedness is taken relative to a curve, called normal sane, which we shall study in Chapter 7. Thus Kurtosis can be defined as the degree gf peakedness of a distribution, taken relative to a normal curve. If a distribution tas a relatively high peak such as the curve of Fig, 4.7(a), it is ealled leptokurtic. However, ifthe jistribution has a relatively flat-topped such as the curve of Fig. 4.7(b), it is called platykurtic. ‘The normal curve which is neither very peaked nor very fat-topped is called mesokurtie [see Fig, 4.7(q)). kangaroos“" Definition. Pearson’s B,-coefficient, also called moment coefficient of defined as 4.54 ad ae where 11, and 1, are second and fourth moments about the mean, respe ‘The value of B, measures the degree of peakedness. The greater the y 5 more peaked is the distribution. The value of fis equal to 3 for the norma) 2." greater than 3 for a leptokurtic curve and less than 3 for a platykurtic cunj "® For the simple reason that B, = 3 for the normal distribution, the ku, sometimes defined by f,~ 3, which is designated by y,. Thus Ye = B,-3 ‘The value of y, is positive for a leptokurtic curve, negative for a pla and zero for a normal curve. Example 64. (i) For a certain distribution, the second and fourth central r are 2 and 17 respectively. Find the moment coefficient of kurtosis. (i If the first four moments about the mean of a distribution are 0, 1.5, 0 the moment coefficient of kurtosis (ii The first four moments of a distribution about mean are 0, 2.5, 7 and 1875, Comment upon the kurtosis of the distribution. ment ient of kurtosis is given by tosis ig tykurtic cure moments and 6, fing‘ d Kurtosis 455 ané sgrewness Hg _ Hg (25)? 625 aes ae s gistribution 15 mesokurtic, we have oe the i B= 3 > 3 => 44, = 6253 = 1875. 66, For a platykurtic distribution having p, = 2.5 and S.D. = 0.8 find the t about the mean. omen pe that S.D. = 0.8. This means fou We are given. eet variance = (S.D.)? = (0.8)? = 0.64 u. ee 4 > 25 = raea = aI > 472.5% 0.4096= 1.024. te 67: pe! a mesokurtic distribution, the first moment about 7 is 23 and ond Be iect about origin is 1000. Find coefficient of variation and fourth moment put mea [Delhi Univ. B.Com (H) 2007 (SOL), 2008, 2012] at site, ners of usual notations, we are given : A= 7, wl, =23 and v,= 1000 n= ¥-A > 23-X-7 = ¥-=30 v,= X (always) -. v,= 30 y+ vi => 1000 = p,+ (30)? > p= 100 4,= 100 and hence S.D.=10 SD. = iy Teas «100 - le 33.33%4.56 Patines, uly 4nlg wh + Only wy? ~ 34? 108 - 4{-30) -1.5) + 6 (17) 1.5)? 3(-1.5)6 108 - 180 + 229.5 - 15.1875 = 142.3195 2 _ (39.75) _ 1580.06 oa = = 0.492 wh” (475)° 9209.05 Hy (ii) Skewness: 8, = hg _ 142.3125 _ 142.3125 i) Kurtosis: B= “y= = = 0.65 cay B= 13” (14.75)? 217.5625 ~°°541 Since 8, < 3, the distribution is Platykurtic. Example 69. The first four moments ofa distribution about the point 9 20 and 100. Find the corresponding moments about the mean aa 20. evaluate B,. and henge Solution. We are given: A= 2, wy =-2, W=12, wy Computation of moments about the mean : n= 0 {always) ty = vy- we =12-(-2)?= 12-4=8 ~-20 tsaigy Hy = Ha~ Sg Hy #2 = 20-3 122) +9xE 99 = -20+72-16 = 36ness and Kurtosis ness Moments into Central Moments : y ‘Ral or fe (always) ty «= te = 19.70 (0.5)? = 19.70 -0.25 = 19.45 b i u's 2 uP = 29.48 - 3 (19.70) (0.5) + 2 (0.5)8 3 Hs” 99.48 -29.55 + 0.25 = 0.18 ol Fate Guan? ~3 ui" We "467.524 (29-48) (0.5) + 6 (19.70) (0.5)?-3 (0.5)* © 967.52-58.96 + 29.55 ~ 0.1875 = 837.9225 nq Coefficient of Kurtosis: acuta iq _ 837.9225 _ 837.9295 *“ag4s)? ~ 378.3005 ~ 2-215 spevalue offi is less than 3, the distribution is platykurtic. ane ie 71. The first four central moments of a distribution are 0, 16, ~ 36 and 120 rey. comment upon the Skewness and Kurtosis of the distribution. a [Dethi Univ. B.Com. (#) 2010] ution. We are given : Hy = 0, W=16, p3=-36 and p,=120 en coefficient of skewness, 7, is given by Hg eto _ 36 th” —3/7 Sige Glia. 025) we By 3 Aor ee, = 0.5625, the distribution is skewed to the left mint coefficient of kurtosis, B, is given by Apo a = 4 = Be = 0.4687 sce the value of B, is less than 3, the distribution is platykurtic. Example 72. The first four moments of a distribution about value 2 are 1, 2.5, 5.5 aad 16 respectively. Calculate the first four moments about mean and comment on thenature ofthe distribution. [Delhi Univ. B.Com. (H) 2002, 2014] Soliton. We are given: A= 2, wi, =1, p'p=2.5, p'p=5.5, p',-16 Conputation of moments about mean : 150 (always) ty = Wy= WE = 2.5-(1)2= 1.5 Hy = Hy= Sptgul, + 2uWP = 55-3 x 2.5 x1 +2 (1)? = 5.5-7.5+2-0 Y= Wy Ang’, + Oye - 3H! , = 16-4x5.5%1+6x 2.5. (1)?-3x (1)*= 16-22+ 15-3 =6 “mment upon the nature of distribution, we calculate the values of f, and 8:ASS Since, = 0, the distribution is symmetrical. iy 6 cme p= Mb = & = % = 267 pee Since <3, the distribution is platykurtic, Example 73. In a certain distribution the first four moments about 5 and 50. Calculate 6, and f, and state whether the distribution ig ia 2,20, ‘ platykurtic, [Delhi Univ. B.Com. (i) 2006, 2010, aoyikins Solution. We are given: A= 5, yl) =2, tp=20, ',=40, y » Calculation of Moments about Mean : ceed aCe (always) y= Wor WY = 20-4=16 Hy = Hy Shy tly + 2H = 40-3 (20) (2) + 2 (2) =— 64, Hy = Hg 4'gul * Bun - 3H = 50-4 (40) (2) +6 (20) (2?-3 (2)* =50~320 + 480-4 - Calculation of beta Coefficients : 162ie nvtests 4.59 yee 95462 + 4 « 37548 «27-6 x 985 x 277 + 3 (27) “= 188462 + 4055184 - 4308390 + 1594323 = 1520579 and B,? en _ (2871)? _s2426a1 — hug” @5e)? ” ler77216 ~ o, the distribution is not symmetrical. Infact, the distribution is skewed negative. ug _ 188462 _ 188462 s = 2.875 i Ga ESS s a esi al <3, the distribution is platykurtc, sovhs ©, The first four moments of a distribution about the origin are 1, 4, 10 sonple 7 "ively. Obtain the various characteristics of the distribution on the at i a ation given. Comment upon the nature of the distribution. ae on. Denoting the first four moments about origin by sent w,=4, wy=10, wy=46 and A=0 jn the various characteristics of the distribution, we shall first obtain the4.60 sy Fin Pisin: Example 76, The first four moments ofa distribution about X= 4 are 1, 4 Set, Obtals the various characteristics of the distribution on the basis of the 10 dq, given. Comment upon the nature of the distribution. [Dethi Univ, B.Com oy Solution.We are given: A= 4% 1 = J, W2=4, 1'5= 10, ee 2035 Moments about Mean : 4,= 0 {always} t= Wye Pa 4-1=3 y= Hy Sua # 2? és Wy = Hg 4n's Hi * Ou = 45-40+24-3=26 ‘Thus the first four moments about mean are : y= 0, Hp =3, Hy =0 and p, =26 Computation of Various Characteristics : () Mean : KewytA=1+4=5 (i) (a) Variance 2 = w=3 ‘Standard deviation ; o= 3 = 1.732 10-3 (4) (1) +2 (1) = 10-12 49-5 ~34i = 45-4 (10) (1) +64) 7-3 94 sv. B.Com. (H) 2004) my pigand pi, Wwe have I55 and A=0cgaoessend Kuss ye ye : aes, hae ae ficient of kurtosis = Roe tie ye: ca ent as * 13) agetrbution is not mesokurtic as the value of 8, is less than 3. rel distribution, the mean is 10, standard deviation is 4, = 75 Fost four moments about the origin, j., zero. Sen a Ec [Delhi Univ. B.Com. (H) 1992, 2012, 2019] Berra: X10, o-%, \Br=1 and p)=4 gest four moments about the origin, we shall first obta : ean, We have t obtain the first four nh, = 0 always) ty = o2= (4)? = 16 42 Re 7 L167 Bee n8!? = (16)? = 64 i = 2 Bret Fem 2 =4 => n= 42 =4 (16)? =4 x 256 = 1024 yur moments about mean are: hy = 0, poste fist ny =16, py =64 and p, = 10244.62 Moments about the value 4. If we let h= 4, then ui) = X-A=10-4=6 Hy = byt wy? = 16 + (6)? = 16 + 26 = 52 o a Ha = ty? Suga * HE = 6443 (16) (6)+ (6? = 64 +288 + 216 = 568 Yuny, oy, “tg We = g* ug u's + On, WP + pit = 1024 + 4 (64) (6) + 6 (16) (6)? + (6)* = 1024 + 1536 +2456 + 1296 = 7312, Example 80. Calculate the first four Thoments about the mean for the & and comment on the nature of the distribution - Cit sg 3 1 6 3 2% 2» 2_yness ana Kurtosis ea Ket ye . ye hele 3y'p's * 2Hy = 0.018 - 3(2.496) (- 0.089) + 2-0.089)* = 0,018 + 0.6664 - 0.0014 = 0.683 pyr Hac aia * Sia uP ~3yi! = 18,2124 (0.018) ¢ 0.089) + 6 (2.496) (-.0.089)?- 3 (- 0.089)* = 18.212 + 0.0064 + 0.1186 -0.0002 = 18.3368 + of skewness, 7}, is given by w + coefficient yo “ii, —0.683__ 0.683 erie (2.4881)9/? 3.9247 wae: 2+0.174, the distribution is moderately skewed to the right. sorte coefficient of kurtosis, B,, is given by one ug _ 18.3368 _ 18.3368 wo = 2.962 Be ye (e4eaiy? © 11906 is less than 3, the distribution is platykurtic. gjnce thE value of Bp ye 81. calculate the first four moments about the mean from the following a Miso calculate the values of By and By : ts : 0-10 10-20 20-30 30-40 40-50 50-60 60-70 im of Students : 5 12 18 40 15, J 3 q [Dethi Univ. B.Com. (H) 1997] solution, Calculation of First Four Moments, B, and B. X-A [cs [orto Frequency eh, | | x f _|(a=35,h=10) | fa fe | fe | ft 0-10 5 5 -3 -15 45 |-135 405 0-20) 15 12 -2 -24 48 -96 192 00-30) 25 18 -1 -18 18 -18 18 10-40] 35 40 oO 0 0 0 0 40-50) 45 15, ie 15 15 15 5 50-60} 55. si az 14 28 56 112 \60-70) 65 3 3 9 7 81 243 els sre | cae] rae | rst |_ = 100 =-19 =181| =-97 = 985 Cs alculating Raw Moments about A = 35: f 2) et | Sfp? = 182x100 - j Zhen “Bato = -19 a Eh sn 184 «100 = 181 i 97 Pee itll ance e xp3 = 22.1000 = -970 y= “W RIT = 100004.64 : = 98500 ising Sey, ng Moments about Mean : (always) y= apn¥4 71-1 9P = 181-3.61= 177.39 Ht uy Bb'gh' + 2u =-970- 3 181) E19) +2 1.9) = 970+ 1031.7 - 13.718 = 47.982 y= wan 4s ba tO uP 3 = 985004 (-970) (1.9) +6 (181) (1.9? -3 -1.9¢ = 98500-7372 +3920.46 - 39.0963 = 95009.3637 2 ae 3 _ (47.982) _ _2302.2723 8 wu Cateulatir n= 0 Calculating f, and f+ ~ @7739) 5581968.754 = 0.0004) b Fs _ 95009.9637 _ 95009.3697 _ 2 (177.39) 31467. 2127 ~ 3015 eample 82. For the following distribution, caleulate the first four centr . and two beta coefficients = — Class.intenl : 20-30 30-40 40-50 50-60 60-70 70-8) gy 5 Frequency Eero! 4 20 25 7 a [Delhi Univ. B.Com, 7 8 Solution, Calculation of Central Moments and Beta Coefficients 2001 Class4.65 54 Top *2000 = sap 1490 Too 10000 = 149000 B oppeta Coefficients : eo® 13 _ G40 __201600 . 2 = 16387069 0.0178 37 ag (25a? 16887063 a4. 149000 = 231 Set 3 64516 pisPERSION, SKEWNESS AND KURTOSIS COMPARED sngstudied dispersion, skewness and kurtosis, we would now like to compare ge “ast them. Asyou know alll these measures are meant to study the formation giomiteacy distribution. For example, dispersion studies the degree to which gat data tend to spread about an average value. It does not show the extent to oe pe individual items cluster below an average value or above it. Measures of si take care of this point. They tell us about the cluster of deviations above seameesure of central tendency. In a symmetrical distribution the deviations al ‘and below an average are equal while in an asymmetrical distributions they set equal. Thus skewness helps us to study the shape, ie, symmetry (or a ‘the distribution. Kurtosis measures the degree of concentration of thev zero : Ungrouped Data Sung Sx? aes4.67 heb yual to fis Ge a platykurtic curve. 3 for a normal curve, greater than 3 for a leptokurtic curve and . pe peat EXERCISE 4.4 seis. Is the study of Kurtosis useful? [Detht Univ, B.Com. (Hf 1991] ts. ‘A frequency distribution can be described almost completely by the and two measures: based on moments.” Examine the statement. [Delhi Univ. B.Com. (H) 1996, 2006] een skewness and kurtosis [Detht Unio, B.Com. (H) 1998, 2004, 2017] ow oe ‘measure of skewness and kurtosis can be used in describing pefine Kart e momen! got four moments 4, Distinguish Ee spain briefly he a frequency distri 0 ‘statements are True or False. distribution, B, = 0. idies the flatness or peakedness of the distribution, ‘lack of symmetry”. of skewness, 8, is always non-negative, n normal is more for a platykurtic curve.4.68 Business (vii) If y’, is the first moment about an arbitrary point ‘4’ then MS Sat, (9) The moment coefficient of kurtosis, Bis given by B, = ., (x) For a mesokurtic distribution, the standard deviation is 3, 7p, fourth moment about the mean must be Ye 7. The first three moments of a distribution about the mean are 0, g, = respectively. Find the moment coefcient of skewness, x, for the diye ~ tg 8. The first three moments of a distribution about the value 4 are 2, 19.5 °% respectively. Find its mean, standard deviation and the moment measure a ad 5, 9. The first three moments of a distributions about the value 3 are 9 ss respectively, Obtain the first three moments about the origin. What ary 0 4 3 variance and ff; of such a distribution? [Delhi Univ, B.A, (Econ, yo’ 10. Fora certain distribution, the variance is 16 and moment coeficient of see) 2% is 1. Calculate the third central moment of the distribution. mess, 11. The first four moments ofa distribution about the value 5 are equal 2,29, «g respectively. Obtain the mean, variance, ./B; and, for the distribution. | "450 [Delhi Univ. B.A Econ, core . 12, The first four moments of a distribution about the value 3 are 1, 2.5, respectively. Do you think that the distribution is leptokurtic? 55 and ig [Delhi Univ. B.A (Econ. Hons, 13. 42 riance = 9, find the values of third and fourth central momen, ‘ e of the distribut and B, is 4. Obtain the upon the nature of he Univ. B.Com fH) 2005, 7, 70, 140 and 75 62500 and Hons) 200 method ofand Kurtis 4.69 aie to fe aes characteristics of the distribution, ge aiseibusion Leptokurtic? @ PO, 0-10 10-20 20-30 30-40 40-50 ssi! 10 20 40 20 10 pene [Dethi Univ. B.Com. (H) 2013] four moments about the mean for the following distribution, Also calculate Fe oa : ae i + 60-62 63-65 66-68 69-71 72-74 weit P 5 18 42 od 8 pene) ic distribution, the first moment about 2 is 1 and the second moment gh pr Ss is 24. Find the coefficient of variation and the fourth central moment. apost on ANSWERS (i) F (ii) F (iy T Fil 5 ‘ - (aT (vi) F (vii) 7 4 @ F “(i leptokurtic (ii) variance (io) zero (vi), mean (vit) pty +A