Chapter1 - 9 CHAPTER 1 CHAPTER 1 CHAPTER 1 CHAPTER 1...

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Unformatted text preview: 9 CHAPTER 1 CHAPTER 1 CHAPTER 1 CHAPTER 1 Exploring what Statistics are Made Of Exploring what Statistics are Made Of Exploring what Statistics are Made Of Exploring what Statistics are Made Of 1. 1. 1. 1. What is Statistics? What is Statistics? What is Statistics? What is Statistics? We all take for granted that things around us change or vary constantly. Sometimes it takes you five minutes to get where you want to go; at other times the same trip takes you much longer. The price of petrol varies over time, the value of insurance payouts varies from claim to claim, salaries vary from one employee to another, etc. Statistics is simply a way of studying and measuring this variability that we see all around us. The goal of statistics is to recognise different kinds of variability and to take this variability into account to make better decisions about the things that matter to us. When we measure the variability, we will obtain some data. In general, data are the facts and figures that we collect and we want to analyse, summarise and interpret this data. All the data collected in a particular study are referred to as the data set for the study. The goal of statistics is to gain information from these data sets. In a broad sense, we can also define statistics in the following way: Statistics is the art and science of collecting, analyzing, presenting, and interpreting data. The information provided by collecting, analyzing, presenting, and interpreting data gives decision makers a better understanding of their environment and enables them to make more informed and better decisions. 2. 2. 2. 2. Elements, Variables and Observations Elements, Variables and Observations Elements, Variables and Observations Elements, Variables and Observations Elements are the entities on which data are collected. For example, say we have a data set that consists of prices at 15 different supermarkets. Then each individual supermarket's prices is an element. This data set contains 15 elements. A variable is a characteristic of interest for the elements. For example, we can be interested in the following prices of the 15 supermarkets: price of bread, price of milk, price of eggs and price of frozen chicken. We know from experience how these four prices can vary. So the price of bread is a variable of interest , the price of milk is a variable of interest, etc. 10 Measurements collected on each variable for every element in a study provide the data. The set of measurements obtained for a particular element is called an observation . For example, the four prices (that of bread, milk, eggs and frozen chicken) given for the first supermarket is an observation, the four prices given for the second supermarket is another observation. Our data set therefore contains 15 observations, and each observation consists of four prices. The Figure below explains the terminologies....
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Chapter1 - 9 CHAPTER 1 CHAPTER 1 CHAPTER 1 CHAPTER 1...

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