Chapter 2: Charts and Graphs 1

Chapter 2 Charts and Graphs

LEARNING OBJECTIVES The overall objective of chapter 2 is for you to master several techniques for summarizing and depicting data, thereby enabling you to: 1. 2. 3. Recognize the difference between grouped and ungrouped data. Construct a frequency distribution. Construct a histogram, a frequency polygon, an ogive, a pie chart, a stem and leaf plot, a Pareto chart, and a scatter plot. CHAPTER TEACHING STRATEGY Chapter 1 brought to the attention of students the wide variety and amount of data available in the world of business. In chapter 2, we confront the problem of trying to begin to summarize and present the data in a meaningful manner. One mechanism for data summarization is the frequency distribution, which is essentially a way of organizing ungrouped or raw data into grouped data. It is important to realize that there is considerable art involved in constructing a frequency distribution. There are nearly as many possible frequency distributions for a problem as there are students in a class. Students should begin to think about the receiver or user of their statistical product. For example, what class widths and class endpoints would be most familiar and meaningful to the end user of the distribution? How can the data best be communicated and summarized using the frequency distribution? The second part of chapter 2 presents various ways to depict data using graphs. The student should view these graphical techniques as tools for use in communicating characteristics of the data in an effective manner. Most business students will have some type of management opportunity in their field before their career ends. The ability to make effective presentations and communicate their ideas in succinct, clear ways is an asset. Through the use of graphics packages and such techniques as frequency polygons, ogives, histograms, and pie charts, the manager can enhance his/her personal image as a communicator and decision-maker. In addition, the manager can emphasize that the final product (the frequency polygon, etc.) is just the beginning. Students should be encouraged to study the graphical output to recognize business trends, highs, lows, etc. and realize that the ultimate goal for these tools is their usage in decision making.

Chapter 2: Charts and Graphs 2

CHAPTER OUTLINE 2.1 Frequency Distributions Class Midpoint Relative Frequency Cumulative Frequency Graphic Depiction of Data Histograms Frequency Polygons Ogives Pie Charts Stem and Leaf Plots Pareto Charts Graphical Depiction of Two-Variable Numerical Data: Scatter Plots

2.2

2.3

KEY TERMS Class Mark Class Midpoint Cumulative Frequency Frequency Distribution Frequency Polygon Grouped Data Histogram Ogive Pareto Chart Pie Chart Range Relative Frequency Scatter Plot Stem and Leaf Plot Ungrouped Data

Chapter 2: Charts and Graphs 3

SOLUTIONS TO PROBLEMS IN CHAPTER 2 2.1 a) One possible 5 class frequency distribution: Class Interval 10 - under 25 25 - under 40 40 - under 55 55 - under 70 70 - under 85 b) Frequency 9 13 11 9 8 50

One possible 10 class frequency distribution: Class Interval 10 - under 18 18 - under 26 26 - under 34 34 - under 42 42 - under 50 50 - under 58 58 - under 66 66 - under 74 74 - under 82 82 - under 90 Frequency 7 3 5 9 7 3 6 4 4 2

c)

The ten class frequency distribution gives a more detailed breakdown of temperatures, pointing out the smaller frequencies for the higher temperature intervals. The five class distribution collapses the intervals into broader classes making it appear that there are nearly equal frequencies in each class.

Chapter 2: Charts and Graphs 4

2.2 One possible frequency distribution is the one below with 12 classes and class intervals of 2. Class Interval 39 - under 41 41 - under 43 43 - under 45 45 - under 47 47 - under 49 49 - under 51 51 - under 53 53 - under 55 55 - under 57 57 - under 59 59 - under 61 61 under 63 Frequency 2 1 5 10 18 13 15 15 7 9 4 1

The distribution reveals that only 13 of the 100 boxes of raisins contain 50 1 raisin (49 -under 51). However, 71 of the 100 boxes of raisins contain between 45 and 55 raisins. It shows that there are five boxes that have 9 or more extra raisins (59-61 and 61-63) and two boxes that have 9-11 less raisins (39-41) than the boxes are supposed to contain.

2.3 Class Interval Frequency 0-5 6 5 - 10 8 10 - 15 17 15 - 20 23 20 - 25 18 25 - 30 10 30 - 35 4 TOTAL 86 Class Midpoint 2.5 7.5 12.5 17.5 22.5 27.5 32.5 Relative Frequency 6/86 = .0698 .0930 .1977 .2674 .2093 .1163 .0465 1.0000 Cumulative Frequency 6 14 31 54 72 82 86

The relative frequency tells us that it is most probable that a customer is in the 15 - 20 category (.2674). Over two thirds (.6744) of the customers are between 10 and 25 years of age.

Chapter 2: Charts and Graphs 5

2.4 Class Interval 0-2 2-4 4-6 6-8 8-10 TOTAL 2.5 Frequency 218 207 56 11 8 500 Class Midpoint 1 3 5 7 9 Relative Frequency .436 .414 .112 .022 .016 1.000 Cumulative Frequency 218 425 481 492 500

Some examples of cumulative frequencies in business: sales for the fiscal year, costs for the fiscal year, spending for the fiscal year, inventory build-up, accumulation of workers during a hiring buildup, production output over a time period.

2.6 Histogram:

Chapter 2: Charts and Graphs 6

Frequency Polygon:

2.7

Histogram:

Chapter 2: Charts and Graphs 7

Frequency Polygon:

2.8 Ogive:

Chapter 2: Charts and Graphs 8

2.9

STEM 21 22 23 24 25 26 27

LEAF 2, 8, 8, 9 0, 1, 2, 4, 6, 6, 7, 9, 9 0, 0, 4, 5, 8, 8, 9, 9, 9, 9 0, 0, 3, 6, 9, 9, 9 0, 3, 4, 5, 5, 7, 7, 8, 9 0, 1, 1, 2, 3, 3, 5, 6 0, 1, 3

2.10

Firm Caterpillar Deere Illinois Too Works Eaton American Standard TOTAL Pie Chart:

Proportion .372 .246 .144 .121 .117 1.000

Degrees 134 89 52 44 42 361

Annual Sales

American Standard 12%

Eaton 12%

Caterpillar 37%

Illinois Tool Works 14%

Deere 25%

Chapter 2: Charts and Graphs 9

2. 11

Company Southwest Delta American United Northwest US Airways Continental TOTAL Pie Chart:

Proportion .202 .198 .181 .140 .108 .094 .078 1.001

Degrees 73 71 65 50 39 34 28 360

Em planem ents

Continental 8% US Airw ays 9%

Southw est 20%

Northw est 11% Delta 20% United 14% American 18%

Chapter 2: Charts and Graphs 10

2.12

Brand Pfizer Johnson & Johnson Merck Bristol-Myers Squibb Abbott Laboratories Wyeth TOTAL Pie Chart:

Proportion .289 .259 .125 .120 .112 .095 1.000

Degrees 104 93 45 43 40 34 359

Pharm aceutical Sales

Wyeth 9% Abbott Lab. 11% Pfizer 29%

Bristol-Myers Squibb 12%

Merck 13%

Johnson & Johnson 26%

Chapter 2: Charts and Graphs 11

2.13

STEM 1 2 3 4 5 6 7 8

LEAF 3, 6, 7, 7, 7, 9, 9, 9 0, 3, 3, 5, 7, 8, 9, 9 2, 3, 4, 5, 7, 8, 8 1, 4, 5, 6, 6, 7, 7, 8, 8, 9 0, 1, 2, 2, 7, 8, 9 0, 1, 4, 5, 6, 7, 9 0, 7 0

The stem and leaf plot shows that the number of passengers per flight were relatively evenly distributed between the high teens through the sixties. Rarely was there a flight with at least 70 passengers. The category of 40's contained the most flights (10). 2.14 Complaint Busy Signal Too long a Wait Could not get through Got Disconnected Transferred to the Wrong Person Poor Connection Total Number 420 184 85 37 10 8 744 99.99 % of Total 56.45 24.73 11.42 4.97 1.34 1.08

Customer Complaints
800 700 600 500 400 300 200 100 0

100 60 40 20
l na ig s o To t ai w gh ou to nt ge a sc di ot G

C1

0
ed ct ne on to e th w ng ro on rs pe n tio ec n on rc o Po

sy Bu

ng lo

an

d ul Co

r th et tg no

r er sf n ra

ed

Count Percent Cum %

420 56.5 56.5

184 24.7 81.2

85 11.4 92.6

37 5.0 97.6

10 1.3 98.9

8 1.1 100.0

Percent

Count

80

Chapter 2: Charts and Graphs 12

2.15
3500

3000

2500

Industrial Products

2000

1 500

1 000

500

0 0 1 000 2000 3000 4000 5000 6000 7000

Hum an Food

2.16
1 80

1 60

1 40

1 20

Sales

1 00

80

60

40

20

0 0 2 4 6 8 1 0 1 2

Advertising

Chapter 2: Charts and Graphs 13

2.17

Class Interval 16 - under 23 23 - under 30 30 - under 37 37 - under 44 44 - under 51 51 - under 58 TOTAL

Frequencies 6 9 4 4 4 3 30

2.18 Class Interval 20 - under 25 25 - under 30 30 - under 35 35 - under 40 40 - under 45 45 - under 50 Frequency 17 20 16 15 8 6 Midpoint 22.5 27.5 32.5 37.5 42.5 47.5 Rel. Freq. .207 .244 .195 .183 .098 .073 Cum. Freq. 17 37 53 68 76 82

Chapter 2: Charts and Graphs 14

2.19

Class Interval 50 - under 60 60 - under 70 70 - under 80 80 - under 90 90 - under 100 TOTAL Histogram:

Frequencies 13 27 43 31 9 123

Frequency Polygon:

Chapter 2: Charts and Graphs 15

Ogive:

2.20

Label A B C D TOTAL Pie Chart:

Value 55 121 83 46 305

Proportion .180 .397 .272 .151 1.000

Degrees 65 143 98 54 360

D 1 5%

A 1 8%

C 27%

B 40%

Chapter 2: Charts and Graphs 16

2.21

STEM 28 29 30 31 32 33

LEAF 4, 6, 9 0, 4, 8 1, 6, 8, 9 1, 2, 4, 6, 7, 7 4, 4, 6 5

2.22

Problem 1 2 3 4 5 6 7 8 9 10 Pareto Chart:

Frequency 673 29 108 379 73 564 12 402 54 202 2496

Percent of Total 26.96 1.16 4.33 15.18 2.92 22.60 0.48 16.11 2.16 8.09

Problems
2500 100 80

2000

1000

40

500

20

0 C5 Count Percent Cum %

1 6 673 564 27.0 22.6 27.0 49.6

8 4 402 379 16.1 15.2 65.7 80.8

10 202 8.1 88.9

3 5 108 73 4.3 2.9 93.3 96.2

9 2 Other 54 29 12 2.2 1.2 0.5 98.4 99.5 100.0

Percent

Count

1500

60

Chapter 2: Charts and Graphs 17

2.23
16

14

12

10

0 0 2 4 6 8 10 12 14 16 18

2.24 Whitcomb Company Class Interval 32 - under 37 37 - under 42 42 - under 47 47 - under 52 52 - under 57 57 - under 62 62 - under 67 67 - under 72 TOTAL Frequency 1 4 12 11 14 5 2 1 50

Chapter 2: Charts and Graphs 18

2.25 Class Interval 20 25 25 30 30 35 35 40 40 45 45 50 TOTAL Frequency 8 6 5 12 15 7 53 Class Midpoint 22.5 27.5 32.5 37.5 42.5 47.5 Relative Frequency 8/53 = .1509 .1132 .0943 .2264 .2830 .1321 .9999 Cumulative Frequency 8 14 19 31 46 53

2.26

Frequency Distribution: Class Interval 10 - under 20 20 - under 30 30 - under 40 40 - under 50 50 - under 60 60 - under 70 70 - under 80 80 - under 90 Histogram: Frequency 2 3 9 7 12 9 6 2 50

Chapter 2: Charts and Graphs 19

Frequency Polygon:

The normal distribution appears to peak near the center and diminish towards the end intervals.

2.27 a. Histogram and a Frequency Polygon for Problem 2.25 Class Interval 20 25 25 30 30 35 35 40 40 45 45 50 TOTAL Frequency 8 6 5 12 15 7 53 Cumulative Frequency 8 14 19 31 46 53

Chapter 2: Charts and Graphs 20

Histogram:

Frequency Polygon:

Chapter 2: Charts and Graphs 21

b. Ogive:

2.28 Asking Price $ 80,000 - under $ 100,000 $ 100,000 - under $ 120,000 $ 120,000 - under $ 140,000 $ 140,000 - under $ 160,000 $ 160,000 - under $ 180,000 $ 180,000 - under $ 200,000 Frequency 21 27 18 11 6 3 86

Cumulative Frequency 21 48 66 77 83 86

Chapter 2: Charts and Graphs 22

Histogram:
30

25

20

1 5

1 0

0 90,000 1 0,000 1 1 30,000 1 50,000 1 70,000 1 90,000 C lass M idpoints

Frequency Polygon:
30

25

20

1 5

1 0

0 90,000 1 0,000 1 1 30,000 1 50,000 1 70,000 1 90,000 C lass M idpoints

Chapter 2: Charts and Graphs 23

Ogive:
1 00

90

80

70

60

50

40

30

20

1 0

0 80,000 1 00,000 1 20,000 1 40,000 C lass Endpoints 1 60,000 1 80,000 200,000

2.29

Amount Spent on Prenatal Care $ 0 - under $100 $100 - under $200 $200 - under $300 $300 - under $400 $400 - under $500 $500 - under $600

Frequency 3 6 12 19 11 6 57

Cumulative Frequency 3 9 21 40 51 57

Chapter 2: Charts and Graphs 24

Histogram:

Frequency Polygon:

Chapter 2: Charts and Graphs 25

Ogive:

2.30 Price $1.75 - under $1.90 $1.90 - under $2.05 $2.05 - under $2.20 $2.20 - under $2.35 $2.35 - under $2.50 $2.50 - under $2.65 $2.65 - under $2.80 Frequency 9 14 17 16 18 8 5 87

Cumulative Frequency 9 23 40 56 74 82 87

Chapter 2: Charts and Graphs 26

Histogram:

Frequency Polygon:

Chapter 2: Charts and Graphs 27

Ogive:

Chapter 2: Charts and Graphs 28

2.31

Genre R&B Alternative Rap Country Soundtrack Metal Classical Latin TOTAL Pie Chart:

Albums Sold 146.4 102.6 73.7 64.5 56.4 26.6 14.8 14.5

Proportion .29 .21 .15 .13 .11 .05 .03 .03 1.00

Degrees 104 76 54 47 40 18 11 11 361

Classical 3% Metal 5% Soundtrack 11%

Latin 3% R&B 29%

Country 13%

Rap 15%

Alternative 21%

Chapter 2: Charts and Graphs 29

2.32

700

600

Manufactured Goods

500

400

300

200

1 00

0 0 5 1 0 1 5 20 25 30 35

Agricultural Products

Chapter 2: Charts and Graphs 30

2.33 Industry Chemicals Primary metals Paper Plastics & Rubber Transportation Equipment Food Fabricated Metals Petroleum Electrical Equipment TOTAL Total Release 737,100,000 566,400,000 229,900,000 109,700,000 102,500,000 89,300,000 85,900,000 63,300,000 29,100,000 Proportion .366 .281 .114 .054 .051 .044 .043 .031 .014 0.998 Degrees 132 103 41 19 18 16 15 11 5 360

Pie Chart:

Fab. M etals Food4% 4% Trans. Equip. 5% Plas. & Rubber 5%

Petro. Elec. % 3% 1

Chem . 38%

Paper 1% 1

Prim M etals . 29%

Chapter 2: Charts and Graphs 31

2.34

Causes of Poor Quality Bottles

500 100

400

80

Count

300

60

200

40

100

20

C1 Count Percent Cum %

Fault in plastic Thickness Broken handle 221 117 86 44.2 23.4 17.2 44.2 67.6 84.8

Labeling 44 8.8 93.6

Discoloration 32 6.4 100.0

2.35

STEM 42 43 44 45 46 47 48 49 50 51 52 53 54 55 56 57 58 59

LEAF 12, 16, 24, 32, 99, 99 04, 28, 39, 46, 61, 88 20, 40, 59 12 53, 54 30, 34, 58 22, 34, 66, 78 63 48, 49, 90 66 21, 54, 57, 63, 91 38, 66, 66 31, 78 56 69 37, 50 31, 32, 58, 73 19, 23

Percent

Chapter 2: Charts and Graphs 32

2.36

STEM 22 23 24 25 26 27 28 29 30

LEAF 00, 68 01, 37, 44, 75 05, 37, 48, 60, 68 24, 55 02, 56, 70, 77 42, 60, 64 14, 30 22, 61, 75, 76, 90, 96 02, 10

2.37 The distribution of household income is bell-shaped with an average of about $ 90,000 and a range of from $ 30,000 to $ 140,000.

2.38 Family practice is most prevalent with about 20% with pediatrics next at slightly less. A virtual tie exists between ob/gyn, general surgery, anesthesiology, and psychiatry at about 14% each. 2.39 The fewest number of audits is 12 and the most is 42. More companies (8) performed 27 audits than any other number. Thirty-five companies performed between 12 and 19 audits. Only 7 companies performed 40 or more audits. 2.40 There were relatively constant sales from January through August ($4 to 6 million). Each month from September through December sales increased with December having the sharpest increase ($15 million in sales in December).