Chapter 01 What is Statistics?

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Chapter

One

McGraw-Hill/Irwin 2005 The McGraw-Hill Companies, Inc., All Rights Reserved.


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Chapter One

What is Statistics?

GOALS

When you have completed this chapter, you will be able to:

ONE

Understand why we study statistics.

TWO

Explain what is meant by descriptive statistics and inferential statistics.THREE

Distinguish between a qualitative variable and a quantitative variable.

FOUR

Distinguish between a discrete variable and a continuous variable.FIVE

Distinguish among the nominal, ordinal, interval, and ratio levels

of measurement.

SIX

Define the terms mutually exclusive and exhaustive.Goals


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What is Meant by Statistics?

Statistics is the science

of collecting, organizing,presenting, analyzing,

and interpreting

numerical data to assist

in making more

effective decisions.


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Who Uses Statistics?

Statistical techniques are

used extensively bymarketing, accounting,

quality control,

consumers, professional

sports people, hospital

administrators,

educators, politicians,

physicians, and manyothers.


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Types of Statistics

EXAMPLE : According to Consumer Reports,

General Electric washing machine owners reported

9 problems per 100 machines during 2001. The

statistic 9 describes the number of problems out ofevery 100 machines.

Descriptive Statistics: Methods of organizing,summarizing, and presenting data in an informative way.


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Types of Statistics

APopulationis a

Collection

of all possibleindividuals,objects, ormeasurements of

interest.

ASampleis a

portion, or part,of the population

of interest

Inferential Statistics:A decision, estimate,prediction, or generalization about a population,

based on a sample.


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Types of Statistics

(examples of inferential statistics)

Example 2: Wine

tasters sip a few drops

of wine to make adecision with respect

to all the wine waiting

to be released for sale.

Example 1: TV

networks constantly

monitor thepopularity of their

programs by hiring

Nielsen and other

organizations tosample the

preferences of TV

viewers.

Example 3: The accounting

department of a large firm will

select a sample of the invoices to

check for accuracy for all theinvoices of the company.

#1


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Types of Variables

Gender

Eye

Color

For a Qualitative or Attribute Variablethecharacteristic being studied is nonnumeric.

Type of car

State of

irth


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Types of Variables

Number of children in a family

In a Quantitative Variableinformation is

reported numerically.

Balance in your checking account

Minutes remaining in class


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Types of Variables

Discrete Variables:can only assumecertain values and there are usually gaps

between values.

Example: the number of

bedrooms in a house, or

the number of hammers

sold at the local Home

Depot (1,2,3,,etc).

Quantitative variables can be classified as either

Discreteor Continuous.


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Types of Variables

The height of students in a class.

A Continuous Variablecan assume anyvalue within a specified range.

The pressure in a tire

The weight of a pork chop


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Summary of Types of Variables

Qualitative or attribute

(type of car owned)

discrete

(number of children)

continuous

(time taken for an exam)

Quantitative or numerical

DATA


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Levels of Measurement

There are four levels ofdata

Nominal

OrdinalInterval

Ratio


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Nominal data

Nominal levelData that is

classified into

categories and

cannot be arranged

in any particularorder.

Gender

Eye

Color

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Mutually exclusiveAn individual, object, or

measurement is included in only

one category.

Nominal level variables must be:

Exhaustive

Each individual, object, ormeasurement must appear in one

of the categories.

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During a taste test

of 4 soft drinks,

Coca Cola was

ranked number 1,

Dr. Pepper number

2, Pepsi number 3,

and Root Beer

number 4.

Ordinal level: involves data arranged in someorder, but the differences between data values cannot

be determined or are meaningless.

2

3

4

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Temperature on the

Fahrenheit scale

Interval levelSimilar to the ordinal level, with the additional

property that meaningful amounts of differencesbetween data values can be determined. There is nonatural zero point.

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Monthly income

of surgeons

Miles traveled by sales

representative in a month

Ratio level:the interval level with an inherentzero starting point. Differences and ratios are

meaningful for this level of measurement.

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Chapter 01 What is Statistics?