Course : STAT6081 Statistics

Year : 2014

Session 1

INTRODUCTION : DATA AND STATISTICS

 Topics
1. Introduction : Data and Statistics
2. Descriptive Statistics
3. Introduction to Probability
4. Discrete Probability Distributions
5. Continuous Probability Distributions
6. Sampling and Sampling Distributions
7. Interval Estimation
8. Hypothesis Tests
9. Analysis of Variance
10. Simple Linear Regression

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 References
Anderson, David R., Sweeney, Dennis J., Williams, Thomas A. (2011).
Statistics for Business and Economics. 11. Cengage Learning. USA.
ISBN: 978-0538481649.

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Evaluating and Grading

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 Learning Outcome

LO 1: Explain the statistical data

LO 2: Interpret the results of statistical measurements
LO 3: Apply statistical method to the real problem
LO 4: Analyze the results from statistical method solution

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(1) Explain the statistical data

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1. Data

2. Statistics

3. Applications in Business and Economics

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 Data are the facts and figures collected, analyzed, and summarized
for presentation and interpretation
All the data collected in a particular study are referred to as the data
set for the study

Example : Table 1 shows a data set containing information for 25

companies that are part of S&P 500. The S&P 500 is made up of 500
companies selected by Standard&Poors. These companies account for
76% of the market capitalization of all U.S.stocks. S&P 500 stocks are
closely followed by investors and Wall Street analysts.
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Table 1. Data Set for 25 S&P 500 Companies

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(1) Elements, Variables, and Observation
Elements
Are the entities on which data are collected For the data set in table 1,
each individual companys stock is an element; the element names appear
in the first column. With 25 stocks, the data set contains 25 elements
Variables
Variable is a characteristic of interest for the elements The data set in
table 1 includes the following five variables
1. Exchange
2. Ticker symbol
3. Business week rank
4. Share price ($)
5. Earnings per share ($)
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 Observations
Measurements collected on each variable for every element in a study
provide the data. The set of measurement obtained for a particular element
is called an observation
Refering to table 1, we see that the set of measurements for the first
observation (Abbott Laboratories) is N, ABT, 90, 46, and 2.02. The set of
measurements for the second observation (Altria Group) is N, MO, 148, 66,
and 4.57, and so on. A data set with 25 elements contains 25 observations.

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(2) Scales of Measurement

Scale Group Order Distance Absolute Zero

Nominal - - -

Ordinal - -

Interval -

Ratio

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 Example :
Nominal :
Personal Computer Ownership Yes No

Ordinal :
Product satisfaction Very Unsatisfied Fairly Unsatisfied
Fairly Satisfied Very Satisfied

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 Example :
Interval :
Temperature 0 0c

Ratio :
Weight 45 kg, 30 kg, etc
Salary Rp. 2.000.000, Rp. 3.000.000, etc

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(3) Qualitative and Quantitative Data

Qualitative data include labels or names used to identify an attribute of

each element.
Qualitative data use either the nominal or ordinal scale of measurement
and may be nonnumeric or numeric
Quantitative data require numeric values that indicate how much or how
many
Quantitative data are obtained using either the interval or ratio scale of
measurement
A qualitative variable is a variable with qualitative data
A quantitative variable is a variable with quantitative data

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(4) Cross-Sectional and Time Series Data

Cross-sectional data are data collected at the same or approximately the

same point in time
The data in table 1 are cross-sectional because they describe the five
variables for the 25 S&P 500 companies at the same point in time
Time series data are data collected over several time periods
Figure 1 provides a graph of the U.S. City average price per gallon for
unleaded regular gasoline. The graph shows gasoline price in a fairly stable
band between $1.80 and $2.00 from May 2004 through February 2005.
After that gasoline price became more volatile. It rose significantly,
culminating with a shard spike in September 2005

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Figure 1. U.S City Average Price per Gallon for Conventional Regular Gasoline

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(5) Data Sources

1. Existing Sources

2. Statistical Studies

3. Data Acquisition Errors

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 Descriptive Statistics
Such summaries of data, which may be tabular, graphical, or numerical, are
referred to as descriptive statistics

Example : Frequencies and Percent Frequencies for the Exchange

Variable
Table 2. Frequencies and Percent Frequencies for the Echange Variable

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Example : Bar Graph for the Exchange Variable

Figure 2. Bar Graph for the Exchange Variable

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Example : Histogram of Share Price for 25 S&P Stocks

Figure 3. Histogram of Share Price for 25 S&P Stocks

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 Statistical Inference

Population
The set of all elements of interest in a
particular study

Sample
A subset of the population Census

The process of conducting a survey to collect

data for the entire population

Sample Survey

The process of conducting a survey to collect

data for a sample

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As one of its major contributions, statistics uses data from a sample
to make estimates and test hypotheses about the characteristics of
a population through a process referred to as Statistical Inference

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Figure 4. The Process of Statistical Inference for the Norris Electronics Example

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Accounting Finance Marketing

Production Economics

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 Exercises
1. Discuss the differences between statistics as numerical facts and statistics
as a discipline or field of study!
2. Table shows a sample of nine European hotels (Conde Nast Traveler,
January 2000). The price of standard double room during the hotels high
season ranges from $ (lowest price) to $$$$ (highest price). The overall
score includes subcribers evaluation of each hotels rooms, service,
restaurants, location/atmosphere, and public areas; a higher overall score
corresponds to a higher level of satisfaction.
a. How many elements are in this data set?
b. How many variables are in this data set?
c. Which variables are qualitative and which variables ae quantitative?
d. What type of measurement scale is used for each of the variables?
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 Anderson, David R., Sweeney, Dennis J., Williams, Thomas A. (2011).
Statistics for Business and Economics. 11. Cengage Learning. USA. ISBN:
978-0538481649.

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