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Unformatted text preview: Statistical Methods for Business Statistical Methods for Business Decision DecisionMaking Making Describing Data 1 Page Week #1 Describing Data This section is a brief review of some simple concepts REVIEW on your own REVIEW on your own 2 Page REVIEW on your own REVIEW on your own InClass Exercise Exercise 1 See the handout for the exercise about consumer complaints. 3 Page Form Your Team Soon! 4 Page DESCRIBING DATA I. Introduction The data we collect when measuring a variable have different values . For example the variable "revenue per month" 5 Page For example, the variable revenue per month probably will have different values each month: $12,000,000; $13,600,000; $11,700,000; $15,300,00 ; . . . . This group of different values is collectively referred to as the distribution of the variable. DESCRIBING DATA As a user of statistics, you'll want to be able to describe your variable's distribution. This is typically done by giving measures central tendency 6 Page dispersion scattergrams (plots) sometimes reveal trends DESCRIBING DATA Last, you can show how frequently each data value appears in the distribution. This can be shown with a table (a frequency distribution) or 7 Page a picture (a histogram.) DESCRIBING DATA II. Central Tendency Measures of central tendency give us information about where the center of a distribution is located 8 Page where the center of a distribution is located OR WHAT THE TYPICAL VALUE IS. There are three commonly used measures. II. Central Tendency A. Mean How do you calculate the mean? This is the "average" of all the values in the 9 Page This is the average of all the values in the distribution. This "average" is calculated as: add up all values in data and divide that sum by the number of data values. It is the most useful and frequently used measure. II. Central Tendency B. Median What is the median? This is the value above and below which fall an 10 Page This is the value above and below which fall an equal number of values. It is the midpoint of the distribution . In other words, it locates the middle of data when they are arranged in increasing order ....
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 Spring '08
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