2.4 Crosstabulations and Scatter Diagrams
61
Refer to the initial crosstabulations. For those players with low handicaps (better
play-ers), which group (male or female) shows the highest percentage saying the
greens are too fast?
Refer to the initial cros

42
Chapter 2
Descriptive Statistics: Tabular and Graphical Presentations
variable of interest on the horizontal axis and the frequency, relative frequency,
or percent fre-quency on the vertical axis. The frequency, relative frequency, or
percent frequency

26
Chapter 1
Data and Statistics
A survey of 131 investment managers in Barrons Big Money poll revealed the
following:
43% of managers classified themselves as bullish or very bullish on the stock market.
The average expected return over the next 12 month

1.5 Statistical Inference
15
mean. Using the data on 5-Year Average Return for the mutual funds in Table 1.1, we can
compute the average by adding the returns for all 25 mutual funds and dividing the sum by 25.
Doing so provides a 5-year average return of

xxviii
Preface
At the end of many sections, we provide Notes and Comments designed to give the student additional insights about the statistical methodology and its application. Notes and
Comments include warnings about or limitations of the methodology,

56
Chapter 2
Descriptive Statistics: Tabular and Graphical Presentations
Simpsons Paradox
The data in two or more crosstabulations are often combined or aggregated to
produce a summary crosstabulation showing how two variables are related. In
such cases,

Preface
The purpose of
STATISTICS
FOR BUSINESS
AND
ECONOMICS is
to give students,
pri-marily those
in the fields of
business
administration
and economics,
a
conceptual
introduc-tion to
the field of
statistics and its
many
applications.
The
text
is
applica

2.3 Exploratory Data Analysis: The Stem-and-Leaf Display
In a stretched stem-and-leaf
display, whenever a stem
value is stated twice, the first
value corresponds to leaf
values of 0 4, and the
second value corresponds to
leaf values of 59.
51
we would pla

xvi
Contents
Glossary 436
Key Formulas 437
Supplementary Exercises 438
Case Problem: Par, Inc. 441
Appendix 10.1 Inferences About Two Populations Using Minitab 442
Appendix 10.2 Inferences About Two Populations Using Excel 444
Appendix 10.3 Inferences Abo

1.7 Data Mining
17
Computers and Statistical Analysis
Minitab and Excel
data sets and the Excel
add-in StatTools are
available on the
website for this text.
Statisticians frequently use computer software to perform the statistical
computations re-quired w

25
Supplementary Exercises
FIGURE 1.9 NUMBER OF NEW DRUGS APPROVED BY THE FOOD AND DRUG
ADMINISTRATION
60
Number of New Drugs
45
30
15
0
1996
1997
1998
1999
2000
2001
2002 2003
Year
The Energy Information Administration of the U.S. Department of Energy pr

28
Chapter 1
Appendix
StatTools is a
professional addin that expands
the statistical
capabilities
available with
Microsoft Excel.
StatTools software
can be
downloaded from
the website that
accompanies this
text.
Data and Statistics
An Introduction to Stat

46
Chapter 2
Descriptive Statistics: Tabular and Graphical Presentations
12. Consider the following frequency distribution.
SELF
Class
Frequency
test
10 19
10
20 29
14
30 39
17
40 49
7
50 59
2
Construct a cumulative frequency distribution and a cumulative

40
Making the classes the
same width reduces the
chance of inappropriate
interpretations by the user.
Chapter 2 Descriptive Statistics: Tabular and Graphical Presentations
Width of the classes The second step in constructing a frequency distribution for q

35
2.1 Summarizing Categorical Data
FIGURE 2.1 BAR CHART OF SOFT DRINK PURCHASES
20
18
16
y
14
uenc
12
req
10
F
8
6
4
2
0
Coke
Diet
Dr.
Classic
Coke
Pepper
Pepsi
Soft Drink
named for its founder, Vilfredo Pareto, an Italian economist.
In quality control
a

20
Chapter 1
Data and Statistics
Summary
Statistics is the art and science of collecting, analyzing, presenting, and
interpreting data. Nearly every college student majoring in business or economics
is required to take a course in statistics. We began the

Chapter 1
Data and Statistics
FIGURE 1.1 U.S. AVERAGE PRICE PER GALLON FOR CONVENTIONAL
REGULAR GASOLINE
$4.50
Gallon
$4.00
$3.50
per
$3.00
erag
e Price
$2.50
$2.00
$1.50
$1.00
Av
8
$0.50
$0
Mar 06
Oct 06
Apr 07
Nov 07
Jun 08
Dec 08
Jul 09
Date
Source: En

WEB file
Stereo
2.4 CrosstabulationsCommon
and Scatter
Diagrams
Pleas
Court.
Th
e
origin
al
crosst
abulat
ion
was
obtain
ed by
aggre
gating
the
data
in the
separa
te
crosst
abulat
ions
for
the
two
courts
. Note
that
for
both
judges
the
perce
ntage
of
appe

41
2.2 Summarizing Quantitative Data
TABLE 2.6 RELATIVE FREQUENCY AND PERCENT FREQUENCY DISTRIBUTIONS FOR
THE AUDIT TIME DATA
Audit Time
(days)
Relative Frequency
Percent Frequency
10 14
.20
20
15 19
.40
40
20 24
.25
25
25 29
.10
10
30 34
.05
5
1.00
100
T

Chapter 1
Data and Statistics
FIGURE 1.5 BAR CHART FOR MUTUAL FUND TYPE
70
y
60
requ
enc
50
40
30
Percent
14
20
10
0
Domestic Equity International Equity
Fixed Income
Fund Type
A graphical summary of the data for the quantitative variable Net Asset
Value,

6
Chapter 1
Data and Statistics
5-Year Average Return (%): The average annual return for the fund over
the past 5 years
Expense Ratio: The percentage of assets deducted each fiscal year for fund expenses
Morningstar Rank: The overall risk-adjusted star ra

xxvii
Preface
focus is on finding evidence to support a research finding, the research
hypothesis is the alternative hypothesis. In situations where the focus is on
challenging an as-sumption, the assumption is the null hypothesis.
New PrecisionTree Softw

4
Chapter 1
Data and Statistics
Finance
Financial analysts use a variety of statistical information to guide their investment recommendations. In the case of stocks, the analysts review a variety of financial data including
price/earnings ratios and divid

xix
Contents
Testing for Significance 658
F Test 658
t Test 661
Multicollinearity 662
Using the Estimated Regression Equation for Estimation
and Prediction 665
Categorical Independent Variables 668
An Example: Johnson Filtration, Inc. 668
Interpreting the

xxi
Contents
Glossary 780
Key Formulas 780
Supplementary Exercises 781
Chapter 18 Time Series Analysis and Forecasting
784
Statistics in Practice: Nevada Occupational Health Clinic 785
(
Time Series Patterns 786
Horizontal Pattern 786
Trend Pattern 788
Se

xxii
Contents
Chapter 19 Nonparametric Methods
855
Statistics in Practice: West Shell Realtors 856
Sign Test 857
Hypothesis Test About a Population Median 857
Hypothesis Test with Matched Samples 862
Wilcoxon Signed-Rank Test 865
Mann-Whitney-Wilcoxon Tes

xi
Contents
0 Exploratory Data Analysis 109
Five-Number Summary 109
Box Plot 110
1 Measures of Association Between Two Variables 115
Covariance 115
Interpretation of the Covariance 117
Correlation Coefficient 119
Interpretation of the Correlation Coeffici

xviii
Contents
Confidence Interval for
1
587
F Test 588
Some Cautions About the Interpretation of Significance Tests 590
Using the Estimated Regression Equation for Estimation
and Prediction 594
Point Estimation 594
Interval Estimation 594
Confidence Inte