1. CHAPTER 1:
INTRODUCTION

2. WHAT IS STATISTICS? Definition
Statistics is a group of methods used to collect, analyze, present, and interpret data and to make decisions.

3. TYPES OF STATISTICS Definition
Descriptive Statistics consists of methods for organizing, displaying, and describing data by using tables, graphs, and summary measures.

4. TYPES OF STATISTICS Definition
Inferential Statistics consists of methods that use sample results to help make decisions or predictions about a population.

5. POPULATION VERSUS SAMPLE
Definition
A population consists of all elements – individuals, items, or objects – whose characteristics are being studied. The population that is being studied is also called the target population.

6. POPULATION VERSUS SAMPLE cont.
Definition
A portion of the population selected for study is referred to as a sample.

7. Figure 1.1 Population and sample.

8. POPULATION VERSUS SAMPLE cont.
Definition
A survey that includes every member of the population is called a census. The technique of collecting information from a portion of the population is called a sample survey.

9. POPULATION VERSUS SAMPLE cont.
Definition
A sample that represents the characteristics of the population as closely as possible is called a representative sample.

10. POPULATION VERSUS SAMPLE cont.
Definition
A sample drawn in such a way that each element of the population has a chance of being selected is called a random sample. If the chance of being selected is the same for each element of the population, it is called a simple random sample.

11. An observation or measurement
BASIC TERMS
Table Sales of Seven U.S. Companies
Company
2001 Sales
(millions of dollars)
Wal-Mart Stores
IBM
General Motors
Dell Computer
Procter & Gamble
JC Penney
Home Depot
217,799
85,866
177,260
31,168
39,262
32,004
53,553
Variable
An observation or measurement
An element or a member

12. BASIC TERMS cont. Definition
An element or member of a sample or population is a specific subject or object (for example, a person, firm, item, state, or country) about which the information is collected.

13. BASIC TERMS cont. Definition
A variable is a characteristic under study that assumes different values for different elements. In contrast to a variable, the value of a constant is fixed.

14. BASIC TERMS cont. Definition
The value of a variable for an element is called an observation or measurement.

15. BASIC TERMS cont. Definition
A data set is a collection of observations on one or more variables.

16. TYPES OF VARIABLES Quantitative Variables
Discrete Variables
Continuous Variables
Qualitative or Categorical Variables

17. Quantitative Variables
Definition
A variable that can be measured numerically is called a quantitative variable. The data collected on a quantitative variable are called quantitative data.

18. Quantitative Variables cont.
Definition
A variable whose values are countable is called a discrete variable. In other words, a discrete variable can assume only certain values with no intermediate values.

19. Quantitative Variables cont.
Definition
A variable that can assume any numerical value over a certain interval or intervals is called a continuous variable.

20. Qualitative or Categorical Variables
Definition
A variable that cannot assume a numerical value but can be classified into two or more nonnumeric categories is called a qualitative or categorical variable. The data collected on such a variable are called qualitative data.

21. Figure 1.2 Types of variables.

22. CROSS-SECTION VERSUS TIME-SERIES DATA
Cross-Section Data
Time-Series Data

23. Cross-Section Data Definition
Data collected on different elements at the same point in time or for the same period of time are called cross-section data.

24. Table 1.2 2002 Net Worth of Six Persons
Name
2002 Net Worth
(billions of dollars)
Bill Gates
Warren Buffett
Helen Walton
George Lucas
Ted Turner
Ralph Lauren
43.0
36.0
18.8
3.0
2.2
2.0

25. Time-Series Data Definition
Data collected on the same element for the same variable at different points in time or for different periods of time are called time-series data.

26. Price of a 30-Second TV Commercial (million dollars)
Table 1.3
Price of a 30-Second TV Commercial During Super Bowl Telecast
Year
Super Bowl
Price of a 30-Second TV Commercial (million dollars)
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
XXVII
XXVIII
XXIX
XXX
XXXI
XXXII
XXXIII
XXXIV
XXXV
XXXVI
XXXVII
.85
.90
1.00
1.10
1.20
1.30
1.60
2.10
2.05
1.90
2.20

27. SOURCES OF DATA Data may be obtained from Internal sources
External sources
Surveys and experiments

28. SUMMATION NOTATION Example 1-1
Annual salaries (in thousands of dollars) of four workers are 75, 42, 125, and 61. Find ∑x
(∑x)²
∑x²

29. Solution 1-1 ∑x = x1 + x2 + x3 + x4 = 75 + 42 + 125 + 61
= 303 = $303,000
(∑x)² = (303)² = 91,809
∑x² = (75)² + (42)² + (125)² + (61)²
= ,
= 26,735

30. Example 1-2 The following table lists four pairs of m and f values:
Compute the following: Σm
Σf²
Σmf
Σm²f m 12 15 20 30 f 5 9 10 16

31. Solution 2-1 Table 1.4 m f f² mf m²f 12 15 20 30 5 9 10 16 5 x 5 = 25
12 x 12 x 5 =
15 x 15 x 9 =
20 x 20 x 10 =
30 x 30 x 16 = 14,400
∑m = 77
∑f = 40
∑f² = 462
∑mf = 875
∑m²f = 21,145