Course: Basic Statistics

Faculty: Dr. Avanish Singh Chauhan

ACADEMIC YEAR: 2025 - 26
Unit: II – Descriptive Statistics PROGRAM: MBA
SEMESTER: I
 Types of Statistics

• Statistics
• The branch of mathematics that transforms data into
useful information for decision makers.

Descriptive Statistics Inferential Statistics

Collecting, summarizing, and Drawing conclusions and/or

describing data making decisions concerning a
population based only on sample
data

6
 Descriptive Statistics

• Collect data
• e.g., Survey

• Present data
• e.g., Tables and graphs

• Characterize data
• e.g., Sample mean =
X i

n
7
 Descriptive Summary Measures

Describing Data Numerically

Central Tendency Quartiles Variation Shape

Arithmetic Mean Range Skewness

Median Interquartile Range

Mode Variance

Geometric Mean Standard Deviation

Coefficient of Variation
 Measures of Central Tendency
Overview
Central Tendency

Arithmetic Mean Median Mode Geometric Mean

X i
XG = ( X1  X2   Xn )1/ n
X= i=1
n Midpoint of Most
ranked values frequently
observed
value
 Arithmetic Mean

• The arithmetic mean (mean) is the most common

measure of central tendency

• For a sample of size n:

X i
X1 + X2 +  + Xn
X= i=1
=
n n

Sample size Observed values

 Arithmetic Mean
(continued)

• The most common measure of central tendency

• Mean = sum of values divided by the number of
values
• Affected by extreme values (outliers)

0 1 2 3 4 5 6 7 8 9 10 0 1 2 3 4 5 6 7 8 9 10

Mean = 3 Mean = 4

1 + 2 + 3 + 4 + 5 15 1 + 2 + 3 + 4 + 10 20
= =3 = =4
5 5 5 5
 Median

• In an ordered array, the median is the “middle”

number (50% above, 50% below)

0 1 2 3 4 5 6 7 8 9 10 0 1 2 3 4 5 6 7 8 9 10

Median = 3 Median = 3

• Not affected by extreme values

 Finding the Median

• The location of the median:

n +1
Median position = position in the ordered data
2
• If the number of values is odd, the median is the middle number
• If the number of values is even, the median is the average of the two
middle numbers

n +1
• Note that is not the value of the median, only the position
2
of the median in the ranked data
 Mode

• A measure of central tendency

• Value that occurs most often
• Not affected by extreme values
• Used for either numerical or categorical
(nominal) data
• There may may be no mode
• There may be several modes

0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 0 1 2 3 4 5 6

No Mode
Mode = 9
 Example

• Five houses on a hill by the beach

$2,000 K
House Prices:

$2,000,000
500,000 $500 K
300,000 $300 K
100,000
100,000

$100 K

$100 K
 Example: Summary Statistics

• Mean: ($3,000,000/5)
House Prices:
= $600,000
$2,000,000
500,000
300,000 • Median: middle value of ranked data
100,000
100,000
= $300,000
Sum $3,000,000
• Mode: most frequent value
= $100,000
 Quartiles

• Quartiles split the ranked data into 4 segments

with an equal number of values per segment

25% 25% 25% 25%

Q1 Q2 Q3

◼ The first quartile, Q1, is the value for which 25% of the
observations are smaller and 75% are larger
◼ Q2 is the same as the median (50% are smaller, 50% are
larger)
◼ Only 25% of the observations are greater than the third
quartile
 Quartile Formulas

Find a quartile by determining the value in the appropriate

position in the ranked data, where
First quartile position: Q1 = (n+1)/4

Second quartile position: Q2 = (n+1)/2 (the median position)

Third quartile position: Q3 = 3(n+1)/4

where n is the number of observed values

 Quartiles

◼ Example: Find the first quartile

Sample Data in Ordered Array: 11 12 13 16 16 17 18 21 22

(n = 9)
Q1 is in the (9+1)/4 = 2.5 position of the ranked data
so use the value half way between the 2nd and 3rd values,

so Q1 = 12.5

Q1 and Q3 are measures of noncentral location

Q2 = median, a measure of central tendency
 Quartiles
◼ Example:
Sample Data in Ordered Array: 11 12 13 16 16 17 18 21 22

(n = 9)
Q1 is in the (9+1)/4 = 2.5 position of the ranked data,
so Q1 = 12.5

Q2 is in the (9+1)/2 = 5th position of the ranked data,

so Q2 = median = 16

Q3 is in the 3(9+1)/4 = 7.5 position of the ranked data,

so Q3 = 19.5
 Measures of Variation

Variation

Range Interquartile Variance Standard Coefficient of

Range Deviation Variation

◼ Measures of variation give

information on the spread
or variability of the data
values.

Same center,
different variation
 Range

• Simplest measure of variation

• Difference between the largest and the smallest
values in a set of data:

Range = Xlargest – Xsmallest

Example:

0 1 2 3 4 5 6 7 8 9 10 11 12 13 14

Range = 14 - 1 = 13
 Disadvantages of the Range

• Ignores the way in which data are distributed

7 8 9 10 11 12 7 8 9 10 11 12
Range = 12 - 7 = 5 Range = 12 - 7 = 5

• Sensitive to outliers
1,1,1,1,1,1,1,1,1,1,1,2,2,2,2,2,2,2,2,3,3,3,3,4,5

Range = 5 - 1 = 4

1,1,1,1,1,1,1,1,1,1,1,2,2,2,2,2,2,2,2,3,3,3,3,4,120

Range = 120 - 1 = 119

 Interquartile Range

• Can eliminate some outlier problems by using

the interquartile range

• Eliminate some high- and low-valued

observations and calculate the range from the
remaining values

• Interquartile range = 3rd quartile – 1st quartile

= Q3 – Q1
Interquartile Range
 Standard Deviation

• Most commonly used measure of variation

• Shows variation about the mean
• Is the square root of the variance
• Has the same units as the original data

n
• Sample standard deviation:
 (X − X)
i
2

S= i=1
n -1
 Example: Sample Standard Deviation

Sample
Data (Xi) : 10 12 14 15 17 18 18 24

n=8 Mean = X = 16

(10 − X)2 + (12 − X)2 + (14 − X)2 +  + (24 − X)2

S=
n −1

(10 − 16)2 + (12 − 16)2 + (14 − 16)2 +  + (24 − 16)2

=
8 −1

A measure of the “average” scatter

130
= = 4.3095 around the mean
7
 Measuring Variation

Small standard deviation

Large standard deviation

 Comparing Standard Deviations

Data A
Mean = 15.5

11 12 13 14 15 16 17 18 19 20 21
S = 3.338

Data B
Mean = 15.5
11 12 13 14 15 16 17 18 19 20 21 S = 0.926

Data C
Mean = 15.5

11 12 13 14 15 16 17 18 19 20 21 S = 4.567
 Shape of a Distribution
• Describes how data are distributed
• Measures of Shape
• Symmetric or Skewed [Skewness]
 Skewness
Skewness is a measure of the asymmetry of a distribution. A
distribution is asymmetrical when its left and right side are not
mirror images. A distribution can have right (or positive), left (or
negative), or zero skewness. A right-skewed distribution is longer
on the right side of its peak, and a left-skewed distribution is
longer on the left side of its peak.
• In a distribution with right skew, the mean is always greater
than median.
• In a distribution with zero skew, the mean and median are equal.
• In a distribution with left skew, the mean is always less than
median.
​Dr. Avanish Singh Chauhan [ डॉ. अवनीश स िंह चौहान ]
Associate Professor | Faculty of Management Studies
9680099891
[Link]@[Link]

Office Location: SB511H