3. The United States government is concerned with the present condition of our economy and with predicting future economic trends. 4. Managers must make decisions about the quality of their product or service. STATISTICS The science of collecting, organizing, presenting, analyzing , and interpreting data to assist in making more effective decisions. STATISTICS The science of collecting, organizing, presenting, analyzing , and interpreting data to assist in making more effective decisions. 5
Who Uses Statistics? Statistical techniques are used extensively by marketing, accounting, quality control, consumers, professional sports people, hospital administrators, educators, politicians, physicians, etc... 7 Types of Statistics – Descriptive Statistics and Inferential Statistics Descriptive Statistics - methods of organizing, summarizing, and presenting data in an informative way. EXAMPLE 1: T he United States government reports the population of the United States was 179,323,000 in 1960; 203,302,000 in 1970; 226,542,000 in 1980; 248,709,000 in 1990, and 265,000,000 in 2000. EXAMPLE 2: According to the Bureau of Labor Statistics , the average hourly earnings of production workers was $17.90 for April 2008. 6
Types of Statistics – Descriptive Statistics and Inferential Statistics Inferential Statistics: A decision, estimate, prediction, or generalization about a population, based on a sample. Note: In statistics the word population and sample have a broader meaning . A population or sample may consist of individuals or objects 7 Population versus Sample A population is a collection of all possible individuals, objects, or measurements of interest. A sample is a portion , or part , of the population of interest 7
Why take a sample instead of studying every member of the population? 1. Prohibitive cost of census 2. Destruction of item being studied may be required 3. Not possible to test or inspect all members of a population being studied 7 Usefulness of a Sample in Learning about a Population Using a sample to learn something about a population is done extensively in business, agriculture, politics, and government. EXAMPLE: Television networks constantly monitor the popularity of their programs by hiring Nielsen and other organizations to sample the preferences of TV viewers. 7
Types of Variables A. Qualitative or Attribute variable - the characteristic being studied is nonnumeric . EXAMPLES: Gender, religious affiliation, type of automobile owned, state of birth, eye color are examples. B. Quantitative variable - information is reported numerically .