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1
         

Introduction and Descriptive Statistics

Using Statistics Percentiles and Quartiles Measures of Central Tendency Measures of Variability Grouped Data and the Histogram Skewness and Kurtosis Relations between the Mean and Standard Deviation Methods of Displaying Data Exploratory Data Analysis Using the Computer
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1-1. Using Statistics (Two Categories)



Descriptive Statistics
Collect Organize Summarize Display Analyze

Inferential Statistics
Predict and forecast values of population parameters Test hypotheses about values of population parameters Make decisions

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Types of Data - Two Types



Qualitative Categorical or Nominal: Examples are Color Gender Nationality

Quantitative Measurable or Countable: Examples are Temperatures Salaries Number of points scored on a 100 point exam

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Scales of Measurement
Nominal Scale - groups or classes Gender Ordinal Scale - order matters Ranks Interval Scale - difference or distance matters Temperatures Ratio Scale - Ratio matters Salaries
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Samples and Populations



A population consists of the set of all measurements in which the investigator is interested. A sample is a subset of the measurements selected from the population. A census is a complete enumeration of every item in a population.
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Simple Random Sample



Sampling from the population is often done randomly, such that every possible sample of equal size (n) will have an equal chance of being selected. A sample selected in this way is called a simple random sample or just a random sample. A random sample allows chance to determine its elements.
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Samples and Populations

Population (N)
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Sample (n)
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Why Sample?
Census of a population may be:
Impossible Impractical Too costly

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1-2 Percentiles and Quartiles



Given any set of numerical observations, order them according to magnitude. The Pth percentile in the ordered set is that value below which lie P% (P percent) of the observations in the set. The position of the Pth percentile is given by (n + 1)P/100, where n is the number of observations in the set.
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Example 1-2 (1) Raw Data

A large department store collects data on sales made by each of of its salespeople. The number of sales made on a given day by each of 20 salespeople is shown on the next slide. Also, the data has been sorted in magnitude.
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Example 1-2 (2) - Sales and Sorted Sales

Sales Sorted Sales
9 6 12 10 13 15 16 14 14 16 17 16 24 21 22 18 19 18 20 17
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6 9 10 12 13 14 14 15 16 16 16 17 17 18 18 19 20 21 22 24

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Example 1-2 (3) Percentiles

Find the 50th, 80th, and the 90th percentiles of this data set. To find the 50th percentile, determine the data point in position (n + 1)P/100 = (20 + 1)(50/100) = 10.5. Thus, the percentile is located at the 10.5th position. The 10th observation is 16, and the 11th observation is also 16. The 50th percentile will lie halfway between the 10th and 11th values and is thus 16.


  

  

To find the 80th percentile, determine the data point in position (n + 1)P/100 = (20 + 1)(80/100) = 16.8. Thus, the percentile is located at the 16.8th position. The 16th observation is 19, and the 17th observation is also 20. The 80th percentile is a point lying 0.8 of the way from 19 to 20 and is thus 19.8.


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Example 1-2 (4) Percentiles

To find the 90th percentile, determine the data point in position (n + 1)P/100 = (20 + 1)(90/100) = 18.9. Thus, the percentile is located at the 18.9th position. The 18th observation is 21, and the 19th observation is also 22. The 90th percentile is a point lying 0.9 of the way from 21 to 22 and is thus 21.9.

 

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Quartiles


Quartiles are the percentage points that break down the data set into quarters. The first quartile is the 25th percentile. It is the point below which lie 1/4 of the data. The second quartile is the 50th percentile. It is the point below which lie 1/2 of the data. This is also called the median. The third quartile is the 75th percentile. It is the point below which lie 3/4 of the data.

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Quartiles and Interquartile Range



The first quartile (25th percentile) is often called the lower quartile. The second quartile (50th percentile) is often called median or the middle quartile. The third quartile (75th percentile) is often called the upper quartile. The interquartile range is the difference between the first and the third quartiles.
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Example 1-2 (6) - Quartiles

(n+1)P/100
Sales 9 6 12 10 13 15 16 14 14 16 17 16 24 21 22 18 19 18 20 17 Sorted Sales 6 9 10 12 13 14 14 15 16 16 16 17 17 18 18 19 20 21 22 24

Quartiles

First Quartile

(20+1)25/100=5.25

13 + (.25)(1) = 13.25

Median

(20+1)50/100=10.5

16 + (.5)(0) = 16

Third Quartile

(20+1)75/100=15.75

18+ (.75)(1) = 18.75

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Summary Measures Population Parameters Sample Statistics



Measures of Central Tendency Median Mode Mean



Measures of Variability Range Interquartile range Variance Standard Deviation

Other summary measures: Skewness Kurtosis

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1-3 Measures of Central Tendency or Location

yMedian Middle value when sorted in order of magnitude 50th percentile Most frequentlyoccurring value Average
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yMode

yMean
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Example 1.2 (7) - Median

Sales 9 6 12 10 13 15 16 14 14 16 17 16 24 21 22 18 19 18 20 17
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Sorted Sales 6 9 10 12 13 14 14 15 16 16 16 17 17 18 18 19 20 21 22 24

Median 50th Percentile

(20+1)50/100=10.5
Median

16 + (.5)(0) = 16

The median is the middle value of data sorted in order of magnitude. It is the fiftieth percentile.
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Example 1-2 (8) - Mode

. . . : . : : : . . . .

. .

--------------------------------------------------------------6 9 10 12 13 14 15 16 17 18 19 20 21 22 24

Mode = 16 The mode is the most frequently occurring value. It is the value with the highest frequency.
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Arithmetic Mean or Average

The mean of a set of observations is their average the sum of the observed values divided by the number of observations. Population Mean
Q!

Sample Mean
x!

x
i !1

x
i !1

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Example 1-2 (9) - (Mean)

Sales
9 6 12 10 13 15 16 14 14 16 17 16 24 21 22 18 19 18 20 17
n

x!

x
i !1

317 ! 1585 . 20

317
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Example 1-2 (10) - Mode

. . . : . : : : . . . .

. .

--------------------------------------------------------------6 9 10 12 13 14 15 16 17 18 19 20 21 22 24

Mean = 15.85 Median and Mode = 16

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1-4 Measures of Variability or Dispersion



Range
Difference between maximum and minimum values

Interquartile Range
Difference between third and first quartile (Q3 - Q1)

Variance
Mean* squared deviation from the mean

Standard Deviation
Square root of the variance
population variance and sample variance differ slightly.

Definitions of

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Example 1-2 (11) Range and Interquartile Range

Sales 9 6 12 10 13 15 16 14 14 16 17 16 24 21 22 18 19 18 20 17
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Sorted Sales 6 9 10 12 13 14 14 15 16 16 16 17 17 18 18 19 20 21 22 24

Rank 1 Minimum 2 3 4 5 6 First Quartile 7 8 9 10 11 12 13 14 15 16 Third Quartile 17 18 19 Maximum 20

Range

Maximum - Minimum = 24 - 6 = 18

Q1 = 13 + (.25)(1) = 13.25

Q3 = 18+ (.75)(1) = 18.75

Interquartile Range

Q3 - Q1 = 18.75 - 13.25 = 5.5

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Variance and Standard Deviation

Population Variance Sample Variance
N

W 2 ! i!1

(x  Q)
N
2

s !
2

(x  x)
i !1

n  1

! W!

x
i!1

( x)

N i !1

( ) x 
n 2

n x i !1

i !1

n  1
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s! s
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Calculation of Sample Variance

x
6 9 10 12 13 14 14 15 16 16 16 17 17 18 18 19 20 21 22 24 317

xx
-9.85 -6.85 -5.85 -3.85 -2.85 -1.85 -1.85 -0.85 0.15 0.15 0.15 1.15 1.15 2.15 2.15 3.15 4.15 5.15 6.15 8.15 0

(x  x) 2
97.0225 46.9225 34.2225 14.8225 8.1225 3.4225 3.4225 0.7225 0.0225 0.0225 0.0225 1.3225 1.3225 4.6225 4.6225 9.9225 17.2225 26.5225 37.8225 66.4225 378.5500

x2
36 81 100 144 169 196 196 225 256 256 256 289 289 324 324 361 400 441 484 576 5403

s !
2

(x  x)
i !1

n  1

378.55 (20  1)

378.55 ! 19.923684 19 x 
2 i !1 n

n x i !1

n
2

n  1

100489 317 5403  5403  20 ! 20 ! 19 20  1 5403  5024.45 378.55 ! ! 19.923684 19 19 s ! s ! 19.923684 ! 4.46 !
2

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1-6 Skewness and Kurtosis



Skewness
Measure of asymmetry of a frequency distribution Skewed to left Symmetric or unskewed Skewed to right

urtosis
Measure of flatness or peakedness of a frequency distribution Platykurtic (relatively flat) Mesokurtic (normal) Leptokurtic (relatively peaked)

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Skewness
Skewed to left
Mean < median < mode
3 0

F re q ue nc y

2 0

1 0

0 1 0 0 2 0 0 3 0 0 4 0 0 5 0 0 6 0 0

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Skewness
Symmetric
Mean = median = mode
3 0

F re q ue nc y

2 0

1 0

0 1 0 0 2 0 0 3 0 0 4 0 0 5 0 0 6 0 0

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Skewness
Skewed to right
Mode > median > mean
3 0

F re q ue nc y

2 0

1 0

0 1 0 0 2 0 0 3 0 0 4 0 0 5 0 0 6 0 0

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Kurtosis
Platykurtic - flat distribution
7 0 0 6 0 0 5 0 0

F re q u e n c y

4 0 0 3 0 0 2 0 0 1 0 0 0 - 3 .5 - 2 .7 - 1 .9 - 1 .1 - 0 .3 0 .5 1 .3 2 .1 2 .9 3 .7

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Kurtosis
Mesokurtic - not too flat and not too peaked
5 0 0

4 0 0

F re q u e n c y

3 0 0

2 0 0

1 0 0

0 -4 -3 -2 -1 0 1 2 3 4

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Kurtosis
Leptokurtic - peaked distribution

2 0 0 0

F re q u e n c y

1 0 0 0

0 -1 0 0 1 0

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1-8 Methods of Displaying Data



Pie Charts
Categories represented as percentages of total

Bar Graphs
Heights of rectangles represent group frequencies

Frequency Polygons
Height of line represents frequency

Ogives
Height of line represents cumulative frequency

Time Plots
Represents values over time
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Pie Chart
Fig. 1-8 Telecommunications Headquarters Other (8.0%) U.S. (30.0%)

Europe (25.0%)

Britain (8.0%)

Japan (29.0%)

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Bar Chart
Fig. 1-9 Airline Operating Expenses and Revenues
12

Average Revenues Average Expenses

10

American Continental Delta

Northwest Southwest United

A i r li n e

USAir

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Frequency Polygon and Ogive

Frequency Polygon
0.3 1.0

Ogive

0.2 0.5 0.1

0.0 0 10 20 30 40 50

0.0 0 10 20 30 40 50

Sales

Sales

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Time Plot
M o n thly S te e l P ro d u c tio n (P ro b le m 1 -4 6 )
8.5

Millions of Tons

7.5

6.5

5.5 Month J F M A M J J A S ON D J F M A M J J A S ON D J F M A M J J A S O

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Using the Computer (Example 1-2) Excel Descriptive Statistics Output

Column1 Mean 15.85 Standard Error 0.99809 Median 16 Mode 16 Standard Deviation 4.463595 Sample Variance 19.92368 Kurtosis 0.115608 Skewness -0.35153 Range 18 Minimum 6 Maximum 24 Sum 317 Count 20
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