MB 0040 Statistics for Management Contents

Unit 1 Introduction Unit 2 Statistical Survey Unit 3 Classification, Tabulation and Presentation of Data Unit 4 Measures Used to Summarise Data Unit 5 Probabilities Unit 6 Theoretical Distributions Unit 7 Sampling and Sampling Distributions 1 19 40 73 117 149 177

Unit 8 Estimation 200 Unit 9 Testing of Hypothesis in Case of Large & Small Samples 217 Unit 10 Chi-Square
Edition: Spring 2010 BKID B1129 7 Jan. 2010
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Unit 11 F Distribution and Analysis of Variance (ANOVA) Unit 12 Simple Correlation and Regression Unit 13 Business Forecasting Unit 14 Time Series Analysis Unit 15 Index Numbers

267 286 318 337 360

Dean Directorate of Distance Education Sikkim Manipal University Board of Studies Chairman HOD Management & Commerce SMU DDE Additional Registrar SMU DDE Controller of Examination SMU DDE Dr. T. V. Narasimha Rao Adjunct Faculty & Advisor SMU DDE Prof. K. V. Varambally Director Manipal Institute of Management Manipal Content Preparation Team Prof. S. Santhanam (Faculty M P Birla Institute of Management) Mrs. Sharada Rudramurthy (Visiting Faculty SIET) Edition: Spring 2010 This book is a distance education module comprising of collection of learning material for our students. All rights reserved. No part of this work may be reproduced in any form by any means without permission in writing from Sikkim Manipal University of Health, Medical and Technological Sciences, Gangtok, Sikkim. Printed and Published on behalf of Sikkim Manipal University of Health, Medical and Technological Sciences, Gangtok, Sikkim by Mr. Rajkumar Mascreen, GM, Manipal Universal Learning Pvt. Ltd., Manipal 576 104. Printed at Manipal Press Limited, Manipal. Content Editing Mr. Subhabaha Pal Lecturer, SMU DDE Bangalore Peer Review By Prof. K. C. S. Rao Chairman, MBA (BT) School of Management Studies, Pondicherry University, Pondicherry

Mr. Pankaj Khanna Director HR, Fidelity Mutual Fund Mr. Shankar Jagannathan Former Group Treasurer Wipro Technologies Limited Mr. Abraham Mathew Chief Financial Officer Infosys BPO, Bangalore Ms. Sadhna Dash Ex-Senior Manager, HR Microsoft India Corporation (Pvt.) Ltd.

SUBJECT INTRODUCTION
Statistics, as a branch of applied mathematics, discusses data management processes. It deals with collection, classification, presentation and analysis of numerical data. It is useful in testing inferences relating to behavior of economic data in the course of managerial decision making. This module comprises of 15 units: Unit 1: Introduction This unit discusses the definition of Statistics and also describes the two categories of Statistics. It also deals with some of the statistical software packages used for evaluating the data. Unit 2: Statistical Survey This unit will briefly explain how to conduct Statistical Survey. We will also discuss about the collection and analysis of numerical data. We further discuss about the various types of data. Unit 3: Classification, Tabulation and Presentation of Data This unit deals with some methods used for classification and presentation of data in a tabular or graphical way that reveals certain patterns. Unit 4: Measures used to Summarise Data This unit explains about the measures available for summarising the data such as mean, median and mode. It also deals with calculation of standard deviation and coefficient of variance. Unit 5: Probability This unit describes the different ways of dealing with uncertainty using the probability concepts. The rules of probability are described in detail. It also describes the application of Bayes theorem. Unit 6: Theoretical Distributions This unit discusses the random variables both discrete and continuous. It deals with the probability distributions associated with the random variables. Unit 7: Sampling and Sampling Distributions This unit describes the sampling design and also the theories of sampling. It further deals with different sampling methods available. At the end of this unit, central limit theorem is discussed.

Unit 8: Estimation This unit gives the importance of estimation used for improving the business statistics. It deals with different types of estimation. We will be discussing the calculation of confidence intervals of the population mean when the standard deviation is unknown. Finally, it deals with the methods to calculate the sample size if the confidence levels are given. Unit 9: Testing of Hypothesis in Case of Large and Small Samples This unit explains hypothesis testing, which is helpful in decision making. It deals with testing of hypothesis in case of large and small samples. Finally, we discuss the calculation of t distribution statistics. Unit 10: Chi-Square This unit discusses about the Chi-Square tests, which are non parametric tests. It further explains the application of Chi-Square test when we have few or no assumptions about the population. Unit 11: F Distribution and Analysis of Variance (ANOVA) In this unit, we will discuss about the purpose of using analysis of variance technique to evaluate the variations among more than two population means. It also deals with conducting the F-test to draw inferences about whether our samples are drawn from populations having the same mean or not. Unit 12: Simple Correlation and Regression This unit explains about the techniques such as correlation and regression, used for investigating the relationship between two or more variables. It also discusses applying these techniques to measure the strength of relationships between variables. Unit 13: Business Forecasting This unit deals with the business forecasting, the methods available in forecasting, and the use of forecasting models in business improvement processes. Unit 14: Time Series Analysis This unit briefly explains about the time series analysis and different components of time series. It also deals with the forecasting methods using time series.

Unit 15: Index Numbers This unit particularly deals with the meaning and definition of index numbers and the types of indices. It also discusses different kinds of index numbers. Finally, it deals with the limitations and uses of index numbers. Module objectives By the end of the module, Statistics for Management, you should be able to: Apply the correct data collection methods Collect and manipulate data to draw valuable inferences Apply probability and probability distribution concepts to solve real life problems Apply correct sampling designs for the data Test hypothesis using various test statistics Apply time series analysis in business scenarios Describe how much the economic variables have changed over time.