Documente Academic
Documente Profesional
Documente Cultură
management
Descriptive statistics- Numerical
measures
Recap
Day 1 Introduction, types of statistics, data and its types
Definition of statistics, terminologies : population , sample, parameter,
statistic, qualitative and quantitative data, levels of measurements :
Nominal, Ordinal, Interval and Ratio- sources of collecting data
Primary and secondary, applications of Statistics in various functions of
management data mining and data warehousing
X X X X
1 2 3
... X N
N N
24 13 19 26 11
5
93
5
18. 6
Properties of AM
Sum of deviations from AM is ZERO
Sum of squares of deviation taken from AM
will be minimum
Combined mean
It is affected by change of scale and change of
origin
Median
Middle value in an ordered array of numbers.
Applicable for ordinal, interval, and ratio data
Not applicable for nominal data
Unaffected by extremely large and extremely
small values.
Median: Computational Procedure
First Procedure
Arrange the observations in an ordered array.
If there is an odd number of terms, the median is
the middle term of the ordered array.
If there is an even number of terms, the median is
the average of the middle two terms.
Second Procedure
The medians position in an ordered array is given
by (n+1)/2.
Median: Example
with an Odd Number of Terms
Ordered Array
3 4 5 7 8 9 11 14 15 16 16 17 19 19 20 21 22
Q1 Q2 Q3
37 43 44 46
39 43 44 46
40 43 44 46
40 43 45 48
Problem
The cost of consumer purchases such as single family
housing, gasoline, internet services, tax preparation ,
and hospitalization were provided in The Wall Street
journal. Sample data typical of the cost of tax return
preparation by services such as H&R block are shown
below
120 230 110 115 160 130 150 105
195 155 105 360 120 120 140 100
115 180 235 255
- Compute the mean, median and mode
- Compute the first and third quartiles
- Compute and interpret the 90th percentile
Measures of Variability
It is often desirable to consider measures of variability
(dispersion), as well as measures of location.
Variability
No Variability
Measures of Variability:
Ungrouped Data
Measures of variability describe the spread or the
dispersion of a set of data.
Common Measures of Variability
Range
Interquartile Range
Mean Absolute Deviation
Variance
Standard Deviation
Z scores
Coefficient of Variation
Range
The difference between the largest and the
smallest values in a set of data
Simple to compute 35 41 44 45
Range 39 43 = 44 46
Largest - Smallest =
48 - 35 = 13 40 43 44 46
40 43 45 48
Interquartile Range
Interquartile Range Q 3 Q1
Deviation from the Mean
Data set: 5, 9, 16, 17, 18
Mean:
X 65 13
N 5
Deviations from the mean: -8, -4, 3, 4, 5
+5
-4 +4
-8 +3
0 5 10 15 20
Mean Absolute Deviation
Average of the absolute deviations from the
mean
X X X
X
M . A. D.
5 -8 +8 N
9 -4 +4
+3 +3 24
16
17 +4 +4
18 +5 +5 5
0 24 4.8
Population Variance
Average of the squared deviations from the
arithmetic mean
X X
X
X
2
2
2
5 -8 64
9 -4 16 N
16 +3 9
130
17
18
+4
+5
16
25
0 130
5
2 6 .0
Population Standard Deviation
Square root of the
variance
X
2
X X X
2
2
N
5 -8 64 130
9 -4 16
16 +3 9 5
17
18
+4
+5
16
25 2 6 .0
0 130
2
2 6 .0
5 .1
Sample Variance
Average of the squared deviations from the
arithmetic mean
X X X X X X
X
2
2
2
2,398 625 390,625 S
1,844 71 5,041 n1
1,539 -234 54,756
6 6 3 ,8 6 6
1,311
7,092
-462
0
213,444
663,866
3
2 2 1 , 2 8 8 .6 7
Sample Standard Deviation
Square root of the
X X
2
sample variance 2
S
X X X X X
2
n1
6 6 3 ,8 6 6
2,398 625 390,625
1,844 71 5,041 3
1,539 -234 54,756
1,311 -462 213,444 2 2 1 , 2 8 8 .6 7
7,092 0 663,866
2
S S
2 2 1 , 2 8 8 .6 7
4 7 0 .4 1
Uses of Standard Deviation
Indicator of financial risk
Quality Control
construction of quality control charts
process capability studies
Comparing populations
household incomes in two cities
employee absenteeism at two plants
Standard Deviation as an
Indicator of Financial Risk
Annualized Rate of Return
Financial
Security
A 15% 3%
B 15% 7%
3-33
Coefficient of Variation
Ratio of the standard deviation to the mean,
expressed as a percentage
Measurement of relative dispersion
C.V . 100
Coefficient of Variation
29
1
84
2
1
4.6 2
10
100 100
. .
CV 1
1
. .
CV 2
2
1 2
4.6 10
100 100
29 84
1586
. 1190
.
A home theatre in a box is the easiest and cheapest way to provide surround
sound for a home entertainment centre. A sample of prices is shown here
(Consumer Reports Buying Guide, 2013). The prices are for models with a
DVD player and for models without a DVD player.
Models with DVD Player Price Models without DVD Player Price
Sony HT-1800DP $450 Pioneer HTP-230 $300
Pioneer HTD-330DV 300 Sony HT-DDW750 300
Sony HT-C800DP 400 Kenwood HTB-306 360
Panasonic SC-HT900 500 RCA RT-2600 290
Panasonic SC-MTI 400 Kenwood HTB-206 300
Compute the mean price for models with a DVD player and the mean price for
models without a DVD player. What is the additional price paid to have a DVD
player included in a home theatre unit?
Compute the range, variance, and standard deviation for the two samples. What
does this information tell you about the prices for models with and without a DVD
player?
Price with DVD player Price without DVD player
Count 5 Count 5
The following data were used to construct the histograms of the number of
days required to fill orders for Dawson Supply, Inc., and J.C. Clark
Distributors
Use the range and standard deviation to support that Dawson Supply
provides the more consistent and reliable delivery times.
dawson clark
Range 2 Range 8
Minimum 9 Minimum 7
Maximum 11 Maximum 15
Count 10 Count 10
coefficient of variation 25.08873455
coefficient of variation 6.552898619
Practice
The following times were recorded by the quarter-mile and mile runners of
a university track team (times are in minutes).
Quarter-Mile Times: .92 .98 1.04 .90 .99
Mile Times: 4.52 4.35 4.60 4.70 4.50
After viewing this sample of running times, one of the coaches commented
that the quarter milers turned in the more consistent times. Use the standard
deviation and the coefficient of variation to summarize the variability in the
data. Does the use of the coefficient of variation indicate that the coachs
statement should be qualified?
Chapter 3 ( 99 -123)