Introduction to Statistics
The Where, Why, and How of
Data Collection
Chapter Reading : 1 & 8
Chap 1-1
Tools of Business Statistics
Descriptive statistics
Collecting, presenting, and describing data
Inferential statistics
Drawing conclusions and/or making decisions
concerning a population based only on
sample data
Chap 1-2
Descriptive Statistics
Collect data
e.g., Survey, Observation,
Experiments
Present data
e.g., Charts and graphs
Characterize data
e.g., Sample mean = ∑x i
Chap 1-3
Inferential Statistics
Making statements about a population by
examining sample results
Sample statistics Population parameters
(known) Inference (unknown, but can
be estimated from
sample evidence)
Sample Population
Chap 1-4
Inferential Statistics
Drawing conclusions and/or making decisions
concerning a population based on sample results.
Estimation
e.g., Estimate the population mean
weight using the sample mean
weight
Hypothesis Testing
e.g., Use sample evidence to test
the claim that the population mean
weight is 120 pounds
Chap 1-5
Tools for Collecting Data
Data Collection Methods
Experiments Written
questionnaires
Telephone Direct observation and
surveys personal interview
Chap 1-6
Survey Design Steps
Define the issue
what are the purpose and objectives of the survey?
Define the population of interest
Develop survey questions
make questions clear and unambiguous
use universally-accepted definitions
limit the number of questions
Chap 1-7
Survey Design Steps
(continued)
Pre-test the survey
pilot test with a small group of participants
assess clarity and length
Determine the sample size and sampling
method
Select sample and administer the survey
Chap 1-8
Types of Questions
Closed-end Questions
Select from a short list of defined choices
Example: Major: __business __liberal arts
__science __other
Open-end Questions
Respondents are free to respond with any value, words, or statement
Example: What did you like best about this course?
Demographic Questions
Questions about the respondents’ personal characteristics
Example: Gender: __Female __ Male
Chap 1-9
Populations and Samples
A Population is the set of all items or individuals of interest
Examples: All likely voters in the next election
All parts produced today
All sales receipts for November
A Sample is a subset of the population
Examples: 1000 voters selected at random for interview
A few parts selected for destructive testing
Every 100th receipt selected for audit
Chap 1-10
Key Definitions
A population is the entire collection of things
under consideration
A parameter is a summary measure computed to
describe a characteristic of the population
A sample is a portion of the population
selected for analysis
A statistic is a summary measure computed to
describe a characteristic of the sample
Chap 1-11
Population vs. Sample
Population Sample
a b cd b c
ef gh i jk l m n gi n
o p q rs t u v w o r u
x y z y
Chap 1-12
Why Sample?
Less time consuming than a census
Less costly to administer than a census
It is possible to obtain statistical results of a
sufficiently high precision based on samples.
Chap 1-13
Sampling Techniques
Sampling Techniques
Nonstatistical Sampling Statistical Sampling
Convenience Simple Systematic
Random
Judgment Cluster
Stratified
Chap 1-14
Statistical Sampling
Items of the sample are chosen based on
known or calculable probabilities
Statistical Sampling
(Probability Sampling)
Simple Random Stratified Systematic Cluster
Chap 1-15
Simple Random Sampling
Every possible sample of a given size has an
equal chance of being selected
Selection may be with replacement or without
replacement
The sample can be obtained using a table of
random numbers or computer random number
generator
Chap 1-16
Stratified Random Sampling
Divide population into subgroups (called strata)
according to some common characteristic
Select a simple random sample from each
subgroup
Combine samples from subgroups into one
Population
Divided
into 4
strata
Sample
Chap 1-17
Systematic Random Sampling
Decide on sample size: n
Divide frame of N individuals into groups of k
individuals: k=N/n
Randomly select one individual from the 1st
group
Select every kth individual thereafter
N = 64
n=8 First Group
k=8
Chap 1-18
Cluster Sampling
Divide population into several “clusters,” each
representative of the population
Select a simple random sample of clusters
All items in the selected clusters can be used, or items can be
chosen from a cluster using another probability sampling
technique
Population
divided into
16 clusters. Randomly selected
clusters for sample
Chap 1-19
Data Types
Data
Qualitative Quantitative
(Categorical) (Numerical)
Examples:
Marital Status
Political Party Discrete Continuous
Eye Color
Examples: Examples:
(Defined categories)
Number of Children Weight
Defects per hour Voltage
(Counted items) (Measured
characteristics)
Chap 1-20
Data Types
Time Series Data
Ordered data values observed over time
Cross Section Data
Data values observed at a fixed point in time
Chap 1-21
Data Types
Sales (in $1000’s)
2003 2004 2005 2006
Time
Atlanta 435 460 475 490 Series
Boston 320 345 375 395 Data
Cleveland 405 390 410 395
Denver 260 270 285 280
Cross Section
Data
Chap 1-22
Data Measurement Levels
Highest Level
Measurements Ratio Complete Analysis
Quantitative
Measurements Interval Data No True Zero Point
Rankings Higher Level
Ordered Categories
Ordinal Data Mid-level Analysis
Categorical Codes Lowest Level
ID Numbers Nominal Data Basic Analysis
Category
Names
