Pearson LCCI

Certificate in Business Statistics

(VRQ) Level 3
(ASE20100)

Examiners’ Report
November 2016

ASE20100 Business Statistics November 2016

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November 2016
Publication code: 51682_ER

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© Pearson Education Ltd 2016

ASE20100 Business Statistics November 2016

Introduction

The candidates seemed to appreciate that they were able to answer the
questions on the question paper rather than separate answer booklets. There
appeared to be enough space for each part to be answered. However, there was
some evidence that the lack of choice had an impact on the performance of the
candidates. It appeared that many candidates were not prepared for questions
on the entire specification, as many parts were left blank. With the lack of choice
it is essential that candidates have a good understanding of the entire
specification.

In general, candidates answered well those questions that required numerical

answers, particularly those questions that required routine calculations (e.g.
obtaining moving averages, least squares regression equation, carrying out a
chi-squared test of association, or the calculation part when carrying out a
statistical test). However, candidates were generally poor at interpreting and
commenting on their answers.

Questions that require reasoned judgement were not answered well. Questions
involving discussion on the collection of data were often avoided. It is important
that candidates become familiar with using data and are able to indicate clearly
what the data is showing. It is not sufficient to just perform numerical
techniques without interpreting the results of these calculations.

Questions involving probability, sampling methods and index numbers tend to

cause difficulties for students. Now that there is no longer any choice, candidates
need to understand these topics.

ASE20100 Business Statistics November 2016

Question 1

Examiner Comments

Candidates made good attempts at finding the five-point moving averages and
many were able to find the daily factors.

Candidates made poor attempts at the parts involving the sampling methods.
Quota sampling is a standard approach to obtaining a sample that is
representative of the population. Many candidates made no attempt at this part
of the question paper, indicating that candidates were under-prepared with
respect to the ‘collection of data’ topic.

ASE20100 Business Statistics November 2016

 Examiner Tip

It is important that candidates are prepared well on sampling methods

and the various methods of data collection. The best way to get an
understanding of data collection is to undertake practical experience.

Question 2

Examiner Comments

Question 2 requires an understanding of the normal distribution to obtain

suitable probabilities. Candidates had little difficulty in computing z scores to
obtain probabilities in the early parts, although having got the correct z-scores
there were errors in reading or manipulating the probabilities to obtain the
correct answers. Some candidates did, however, have difficulties in combining
independent normal distributions to find the standard deviation for the sum of
normal variables.

The second part of this question required candidates to test for the difference
between two proportions. Some candidates mixed up proportions with numbers,

ASE20100 Business Statistics November 2016

but, on the whole, many obtained the correct value of the test statistic. There
are still a large number of candidates who get confused with the hypotheses and
the conclusions. Consequently, despite getting the correct value for the test
statistic many choose the incorrect conclusion (in fact, the opposite to the one
that should have been made).

Examiner Tip

Probability is a difficult concept but is important as a measure of risk within a

business environment. Candidates need to know when to multiply and add
probabilities.

ASE20100 Business Statistics November 2016

Question 3

Examiner Comments

Question 3 required candidates to obtain and interpret a national Retail Price

Index. In general, the calculations were fine but there was little clear
interpretation of the results.

Here candidates need to carry out a correlation analysis to identify the strength
of relationship between two variables. This question was answered well as it
required the candidates to carry out routine calculations. Few candidates
identified that correlation does not prove causation, as another factor may be
causing both variables to increase.

Candidates were also able to test for significant correlation. The main difficulty
was that a number of candidates tested incorrectly with (n-1) degrees of
freedom for the t-distribution rather than the correct (n-2) degrees of freedom.

ASE20100 Business Statistics November 2016

 Examiner Tip

Although good marks can be obtained from the calculation of the correlation
coefficient or the regression equation (if required), further marks can be
obtained by understanding what the data is showing – is there a strong
relationship, is it positive or negative, are there outliers?

A standard mistake when testing for the significance of a correlation coefficient

is to use n-1 degrees of freedom rather than n-2 degrees of freedom for the t-
distribution.

Question 4

Examiner Comments

The chi squared question was answered well. In this question, the candidates
had to determine the chi-square statistic from the tables of observed frequencies
(although some of the contributions were provided in this question). The test of
association itself caused few difficulties. However, it is often useful to be able to
view the contributions to the chi-squared statistic to identify what the relation is
between the two factors.

In part (c) candidates were often unable to determine straightforward

conditional probabilities. These probabilities, if correct, should have helped the
candidates to identify that Aztec tended to supply lower quality goods than the
other two suppliers.

ASE20100 Business Statistics November 2016

In part (d) a 95% confidence interval for a population mean was answered well,
but candidates found it difficult to use the confidence interval to obtain the
outcome of an equivalent statistical test.

Examiner Tip

The calculations for a chi squared test are well-understood. A clear

understanding of the conclusions from such a test, including sight of the
contributions, to fully understand in what way the two factors may be associated
is now expected. Candidates are now required to do more than carry out the
mechanistic calculations of this test.

The connection between a statistical test and a confidence interval was not
understood at all.

ASE20100 Business Statistics November 2016

Question 5

Examiner Comments

Question 5 required candidates to understand why a paired t-test should be

carried out for the situation described. This was not answered well.
However, many candidates did carry out the test fully and completely (with
some confusion over the final conclusion).

Candidates seemed to understand the concepts of types of errors in statistical

testing.

In part (c), candidates were usually able to calculate the confidence interval for
a proportion. However, in part (d), candidates struggled to estimate the sample
size required to achieve a given degree of accuracy. Candidates usually tried to
obtain this sample size using a formula (which was often incorrect) rather than
finding it from first principles.

Examiner Tip

The concepts of statistical testing is crucial to this Level 3 paper. Candidates

should be aware of the steps required.

ASE20100 Business Statistics November 2016

Paper Summary
Candidates showed an excellent ability to carry out standard procedures
involving mechanistic calculations such as obtaining the mean and standard
deviation of grouped data, the chi squared test statistic, the test for significant
correlation and other statistical tests. However, there was a general weakness in
interpreting results and in explaining many statistical concepts, including clear
explanations concerning statistical testing.

It would benefit candidates to use real data and develop skills in understanding
the results of their calculations.

Candidates appeared to have taken to the new style of paper for this
specification reasonably well. In general, they attempted most questions and
made reasonable attempts at most topics. However topics such as ‘Collection of
Data’, ‘Index Numbers’, and ‘Probability’ still cause some difficulties.

ASE20100 Business Statistics November 2016

Grade Boundaries
Grade boundaries for this, and all other papers, can be found on the
website on this link:

http://qualifications.pearson.com/en/support/support-topics/results-
certification/grade-boundaries.html

ASE20100 Business Statistics November 2016