INTRODUCTION TO

STATISTICS

SHAH AMIT L. Asst.Professore,

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Why study statistics?
Suppose you’re in a situation where you want
to answer a question or explain something.
e.g. Do men earn more than women?
You can collect and analyze data.
Then, you use the data to draw conclusions.

That’s statistics!
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 What Is Statistics?
1. Collecting Data
e.g., Sample, Survey,
Observe. Data Why?
2. Characterizing Data Analysis
e.g., Organize/Classify,
Count, Summarize
3. Presenting Data
e.g., Tables, Charts,
Statements Decision-
4. Interpreting Results Making
e.g. Conclude, Specify with
Confidence

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 Statistics In Business
Marketing And QT
Eg: To Know Target Market, Customer Willing to pay,
Advertising etc…
Production mgt And QT
Eg: To Know Inventory Control, Work Scheduling, What
and how much produce…
Finance And QT
Budgetary Control, Ratio Analysis, Avg Return,
Regression analysis….
Human Resources And QT
Avg Salary, Level of Satisfaction, Benefits, Turnover
Ratio….
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Populations and samples

Population is the collection of all things we are

interested in (people, things or objects)
– e.g. salaries across the country for both men & women

Sample is the subset that we collect and analyze

– e.g. survey of men and women, asking about salaries.
We study the sample so that we can know more
about the population.

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 Populations & Samples
Population Sample
• 1

Subset

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Parameters and statistics
These are what we want to know about
populations • P in Population
and samples
& Parameter
•Parameters measure population • S in Sample
characteristics & Statistic
– e.g. national average salary for a female
•Statistics measure sample characteristics
– e.g. average salary for a female in the survey
•We calculate a statistic by analyzing a sample
• Then estimate a parameter based on statistic
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 Population and Sample

Population Sample

Use statistics to
summarize features

Use parameters to
summarize features

Inference on theSHAH
population from the sample
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 Statistical Methods

Statistical
Methods

Descriptive Inferential
Statistics Statistics

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 Descriptive Statistics
1. Involves
• Collecting Data `
50
• Organizing Data
• Presenting Data 25
• Characterizing Data
0
2. Purpose Q1 Q2 Q3 Q4
• Describe Data
X = 30.5

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 Types of Statistical Applications
in Business
• Descriptive Statistics - describe
collected data
• “51.4% of all credit card purchases in
2009 were made with a Visa Card”

• “The average Pay-to-Return Rating of

Retailing Industry CEOs in 2005 was
126.6”

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 Inferential Statistics
1. Involves Population?
• Estimation
• Hypothesis
Testing

2. Purpose
• Make decisions about
population characteristics
3. Example
• Retail CEOs were overpaid
Drawing conclusions and/or making decisions concerning a population
based on sample results.
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 Types of Data

Types of
Data

Quantitative Qualitative
Data Data

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 Scale of Measurement
1. Nominal Level
Description
Data collected are names, labels or number.
Example
Names of city in India.
Type of Data
Qualitative

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2. Ordinal Level

Description
Data show the properties of nominal
data, and the rank of the data is
meaningful
Example
Supervisor can evaluate three employees
by ranking their productivity…
Type of Data
Qualitative
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3. Interval Level
Description
• Data in which the Distances between Consecutive
numbers have meaning and the data are always
numerical.
• zero value is illogically assigned - e.g., zero
temperature in F scale is not no heat at all.
• Ratios of scale variables do not describe relative
values correctly – e.g., 40o F is not twice 20o F.

Type of Data
Quantitative
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4. Ratio Level
Description
 Data have the properties of interval data, and
the ratio of observations is meaningful.
 Zero value properly describes the underlying
phenomenon - e.g., bank balance.
 Ratios of scale values properly describe
relative values – e.g., 4 feet long is indeed
twice as long as 2 feet
Type of Data
Quantitative

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 Comparison of four level data

Type Basic Empirical Typical Usage Typical Statistics

Operations Descriptive Inferential

Nominal Determination of Classification of male- Percentage Chi-square

Equality female, smoker-non mode Binomial
smoker
Ordinal Determination of Ranking : Preference Median Rank-order
greater or less data, market position, correlation
attitude measurement
Interval Determination of Index numbers, Mean, Range, T-Test, Factor
equality of attitude measurement Standard analysis
intervals Deviation
Ratio Determination of Sales, units produced, Geometric Coefficient of
equality of ratios number of customers, Mean variation
costs, age etc.

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