UNIT 1

Introduction, Definition, objectives

# What is Statistics?

Statistics is the discipline that concerns the collection, organization, analysis, interpretation,
and presentation of data.

Data are individual facts or items of information, may be qualitative or quantitative.

# Primary & Secondary Data

Primary data are the original data derived from your research endeavors. Secondary data are
data derived from your primary data. Primary data is information collected through original or
first-hand research. For example, surveys and focus group discussions. On the other hand,
secondary data is information which has been collected in the past by someone else. For
example, researching the internet, newspaper articles and company reports.

# Population & Sample

Population A population consists of all the items or individuals or subjects about which you
want to draw a conclusion. So, the population is the “large group” in which you are interested.

Sample A sample is the portion of a population selected for analysis. The sample is the “small
group” for whom we have (or plan to have) data, often randomly selected.

# Sample and Parameter

Parameter is a numerical measure that describes a characteristic of a population.

Statistic is a numerical measure that describes a characteristic of a sample

# BRANCHES OF STATISTICS

Descriptive Statistics: The branch of statistics that focuses on collecting, summarizing, and
presenting a set of data.

Inferential Statistics: The branch of statistics that analyzes sample data to draw conclusions
about a population.

# Variable: A characteristic of an individual that will be analyzed using statistics

Categorical (qualitative) variables have values that can only be placed into categories, such as
“yes” and “no”; major; architectural style; etc.

Numerical (quantitative) variables have values that represent quantities.

• Discrete variables arise from a counting process

Examples: Number of printing errors per page on a book. Number of customers arriving at a
restaurant

• Continuous variables arise from a measuring process

Examples: Height of a person, Weight of a person, Time a customer waits in a bank queue.
 UNIT 2
Data Summarization
Data summarization is the first step in statistics, it is aimed at extracting useful information. Summary
statistics are used to summarize a set of observations, to communicate the largest amount of information
as simply as possible.

Data can be summarized numerically as a table (tabular summarization), or visually as a graph (data
visualization).

# Frequency Distribution

Frequency is how often something repeats, and a frequency distribution is a representation,

either in a graphical or tabular format, that displays the number of observations within a given
interval. t gives a visual display of the frequency of items or shows the number of times they
occurred.

Example 1

Tally marks are often used to make a frequency distribution table. For example, let’s say you
survey a number of households and find out how many pets they own. The results are 3, 0, 1, 4,
4, 1, 2, 0, 2, 2, 0, 2, 0, 1, 3, 1, 2, 1, 1, 3. Looking at that string of numbers boggles the eye; a
frequency distribution table will make the data easier to understand.

# Types of frequency distribution

Ungrouped frequency distribution: It shows the frequency of an item in each separate data value
rather than groups of data values.

Grouped frequency distribution: In this type, the data is arranged and separated into groups
called class intervals. The frequency of data belonging to each class interval is noted in a frequency
distribution table. The grouped frequency table shows the distribution of frequencies in class
intervals.
# Steps for constructing Frequency distribution

• Sort the data in ascending order

• Calculate the range of data
• Decide on the number of intervals in the frequency distribution
• Determine the intervals.
• Decide the starting point
• Tally and count the observations under each interval.

# Exercise:

100 schools decided to plant 100 tree saplings in their gardens on world environment day. Represent the
given data in the form of frequency distribution and find the number of schools that are able to plant 50%
of the plants or more?

95, 67, 28, 32, 65, 65, 69, 33, 98, 96, 76, 42, 32, 38, 42, 40, 40, 69, 95, 92, 75, 83, 76, 83, 85, 62, 37, 65,
63, 42, 89, 65, 73, 81, 49, 52, 64, 76, 83, 92, 93, 68, 52, 79, 81, 83, 59, 82, 75, 82, 86, 90, 44, 62, 31, 36,
38, 42, 39, 83, 87, 56, 58, 23, 35, 76, 83, 85, 30, 68, 69, 83, 86, 43, 45, 39, 83, 75, 66, 83, 92, 75, 89, 66,
91, 27, 88, 89, 93, 42, 53, 69, 90, 55, 66, 49, 52, 83, 34, 36

# Frequency Distribution Graphs

There is another way to show data that is in the form of graphs and it can be done by using a
frequency distribution graph. The graphs help us to understand the collected data in an easy way.
The graphical representation of a frequency distribution can be shown using the following:

# Bar Graph:

A bar chart or bar graph is a chart or graph that presents categorical data with rectangular bars
with heights or lengths proportional to the values that they represent. The bars can be plotted
vertically or horizontally. A vertical bar chart is sometimes called a column chart.

# Pie Chart:

A pie chart is a circular statistical graphic, which is divided into slices to illustrate numerical
proportion. Or
A Pie Chart is a type of graph that displays data in a circular graph. The pieces of the graph are
proportional to the fraction of the whole in each category. In other words, each slice of the pie is
relative to the size of that category in the group as a whole. The entire “pie” represents 100
percent of a whole, while the pie “slices” represent portions of the whole.

Imagine you survey your friends to find the kind of movie they like best:

You can show the data by this Pie Chart:

Histograms: A histogram is a graphical presentation of data using rectangular bars of different

heights. In a histogram, there is no space between the rectangular bars.

A two-dimensional graphical representation of a continuous frequency distribution is called a

histogram. In histogram, the bars are placed continuously side by side with no gap between
adjacent bars. That is, in histogram rectangles are erected on the class intervals of the distribution.
The areas of rectangle are proportional to the frequencies.

Steps of constructing Histogram:

Step 1 : Represent the data in the continuous form if it is in the discontinuous form.

Step 2 : Mark the class intervals along the X-axis on a uniform scale.

Step 3 : Mark the frequencies/Frequency densities along the Y-axis on a uniform scale.

Step 4 : Construct rectangles with class intervals as bases and corresponding frequencies/f.d. as
heights.
# Frequency Polygon: A frequency polygon is drawn by joining the mid-points of the bars in a histogram.

# Cumulative Frequency Polygon (Ogive curve):

A curve that represents the cumulative frequency distribution of grouped data on a graph is called a
Cumulative Frequency Curve or an Ogive. Representing cumulative frequency data on a graph is the
most efficient way to understand the data and derive results.
 UNIT 3
Measures of Location/ Central Tendency
A measure of central tendency/ Location
A measure of central tendency is a single value that attempts to describe a set of data by
identifying the central position within that set of data. As such, measures of central
tendency are sometimes called measures of central location. They are also classed as
summary statistics. The mean (often called the average) is most likely the measure of
central tendency that you are most familiar with, but there are others, such as the median
and the mode.
The mean, median and mode are all valid measures of central tendency, but under
different conditions, some measures of central tendency become more appropriate to
use than others.

Mean
The mean is the arithmetic average, and it is probably the measure of central tendency
that you are most familiar. Calculating the mean is very simple. You just add up all of the
values and divide by the number of observations in your dataset.
The three classical Pythagorean means are

• The arithmetic mean(AM)

• The geometric mean(GM), and
• The harmonic mean(HM).

The Arithmetic Mean:

The arithmetic mean is calculated by adding all of the numbers and dividing it by the total
number of observations in the dataset.
For example: Arithmetic Mean of 4 + 10 + 7 is 21/3 = 7
∑ 𝒙𝒙
For raw data 𝐀𝐀𝐀𝐀𝐀𝐀𝐀𝐀𝐀𝐀𝐀𝐀𝐀𝐀𝐀𝐀𝐀𝐀𝐀𝐀 𝐌𝐌𝐀𝐀𝐌𝐌𝐌𝐌 = 𝒏𝒏
, where ∑ 𝑥𝑥 is the sum of all individual’s data and n
is the total number of data/observation.
∑ 𝑓𝑓𝑓𝑓
For frequency distribution 𝐀𝐀𝐀𝐀𝐀𝐀𝐀𝐀𝐀𝐀𝐀𝐀𝐀𝐀𝐀𝐀𝐀𝐀𝐀𝐀 𝐌𝐌𝐀𝐀𝐌𝐌𝐌𝐌 𝐀𝐀. 𝐌𝐌. = ∑ 𝑓𝑓
, 𝑤𝑤ℎ𝑒𝑒𝑒𝑒𝑒𝑒 𝑓𝑓 𝑖𝑖𝑖𝑖 𝑡𝑡ℎ𝑒𝑒 𝑓𝑓𝑒𝑒𝑒𝑒𝑓𝑓𝑓𝑓𝑒𝑒𝑓𝑓𝑓𝑓
For Example:
For Ungrouped Data For Grouped Data

∑ 𝑓𝑓𝑥𝑥 1080
�=
𝒙𝒙 = = 18
∑ 𝑓𝑓 60

∑ 𝑓𝑓𝑥𝑥 390
�=
𝒙𝒙 = = 15.6
∑ 𝑓𝑓 25

Note
The arithmetic mean works well when the data is in an additive relationship between the
numbers, often when the data is in a ‘linear’ relationship which when graphed the
numbers either fall on or around a straight line. i.e. when they are clustered.

Geometric Mean
Not all datasets establish a linear relationship, sometimes you might expect a
multiplicative or exponential relationship and, in those cases, arithmetic mean is ill-suited
and might be misleading to summarize the data.
The Geometric Mean (GM) is the average value or mean which signifies the central
tendency of the set of numbers by taking the root of the product of their values. Basically,
we multiply the 'n' values altogether and take out the nth root of the numbers, where n
is the total number of values.

𝑮𝑮𝑮𝑮𝑮𝑮𝑮𝑮𝑮𝑮𝑮𝑮𝑮𝑮𝑮𝑮𝑮𝑮 𝑴𝑴𝑮𝑮𝑴𝑴𝒏𝒏 𝐺𝐺. 𝑀𝑀. = 𝑛𝑛�𝑥𝑥1 𝑥𝑥2 𝑥𝑥3 . . . . 𝑥𝑥𝑛𝑛

3
i.e. The geometric mean of 5, 7 and 10 is = √5 × 7 × 10 = 7.04

Note
The geometric mean works well when the data is in an multiplicative relationship or in
cases where the data is compounded; hence you multiply the numbers rather than add
all the numbers.
For example
Suppose you invested $500 initially which yielded 10% return the first year, 20% return
the second year and 30% return the third year. After three years, you have $500 * 1.1 *
1.2 * 1.3 = $858.00.
Whereas if you taking arithmetic mean, it’s 10+20+30 = 20% return on average per year,
so after three years you would have $500 * 1.2 * 1.2 * 1.2 = $864. As we can see,
arithmetic mean overestimates earnings by nearly $6 which is not right since we applied
an additive operation to a multiplicative process.
Investors usually consider using geometric mean over arithmetic mean to measure the
performance of an investment or portfolio.

Harmonic Mean
The Harmonic Mean (HM) is defined as the reciprocal of the arithmetic mean of the
reciprocals of the data values.
1 𝑛𝑛
i.e. 𝐻𝐻. 𝑀𝑀. = 1 1 1 1 = 1 1 1 1
� + + + − − − + �/𝑛𝑛 + + +−−−+
𝑥𝑥1 𝑥𝑥2 𝑥𝑥3 𝑥𝑥𝑛𝑛 𝑥𝑥1 𝑥𝑥2 𝑥𝑥3 𝑥𝑥𝑛𝑛

1 3
For the numbers 4, 6 and 8 𝐻𝐻. 𝑀𝑀. = 1 1 1 = 1 1 1 = 5.54
� + + �/3 � + + �
4 6 8 4 6 8

Note
Harmonic mean is used when we want to average units such as speed, rates and ratios.
For example: I drove at an speed of 60km/hr to Seattle downtown and returned home at
a speed of 30km/hr and the distance from my house to Seattle is 20 km. What was my
average speed for the whole trip?
1
Average speed = 1 1 = 40 𝑘𝑘𝑘𝑘/ℎ NOT (60+30)/2 = 45 km/hr.
� + �/2
60 30

Relationship among AM, GM and HM

For two Number a and b
𝑴𝑴+𝒃𝒃
Arithmetic mean (A.M.) =
𝟐𝟐

Geometric mean (G.M.) = √𝑎𝑎 × 𝑏𝑏

𝟏𝟏 𝟐𝟐𝑴𝑴𝒃𝒃 𝑴𝑴𝒃𝒃 (𝑮𝑮𝑴𝑴)𝟐𝟐
Harmonic mean (H.M.) = 𝟏𝟏 𝟏𝟏 = = =
( + )/𝟐𝟐 𝑴𝑴+𝒃𝒃 (𝑴𝑴+𝒃𝒃)/𝟐𝟐 𝑨𝑨𝑴𝑴
𝑴𝑴 𝒃𝒃
 (𝑮𝑮𝑴𝑴)𝟐𝟐
𝑯𝑯𝑴𝑴 =
𝑨𝑨𝑴𝑴
The harmonic mean has the least value compared to the geometric and arithmetic mean
and 𝐴𝐴𝑀𝑀 ≥ 𝐺𝐺𝑀𝑀 ≥ 𝐻𝐻𝑀𝑀

Median
Like mean median is a measure of central tendency. Median determines the middle value
of a dataset listed in ascending order (i.e., from smallest to largest value). The measure
divides the lower half from the higher half of the dataset.
How to Find the Median
The median can be easily found. In some cases, it does not require any calculations at all.
The general steps of finding the median include:
• Arrange the data in ascending order (from the lowest to the largest value).
• Determine whether there is an even or an odd number of values in the dataset.
• If the dataset contains an odd number of values, the median is a central value that
will split the dataset into halves.
• If the dataset contains an even number of values, find the two central values that
split the dataset into halves. Then, calculate the mean of the two central values.
That mean is the median of the dataset.
For Example
Median Class
To find the median class, we have to find the cumulative frequencies of all the classes and
n/2. After that, locate the class whose cumulative frequency is greater than (nearest to)
n/2. The class is called the median class.

Finding Median Using Cumulative Frequency Graph

Note
As Median does not get influenced by extreme values (mean does get influenced by
extreme value), so when dataset is highly fluctuating or deviating from the central value,
median can be used as an appropriate measure of central tendency.

Mode:

The mode is the value that appears most frequently in a data set. A set of data may have
one mode, more than one mode, or no mode at all.
When the data set has one mode, we call it Unimodal
For example, the mode (unimodal) in the following dataset is 19:
Dataset: 3, 4, 11, 15, 19, 19, 19, 22, 22, 23, 23, 26
When the data set has two modes, we call it bimodal
For example, the modes in the following dataset are 11 and 19:
Dataset: 3, 7, 4, 11, 15, 11, 14 19, 19, 19, 22, 20, 11, 22, 23, 23, 26
When the data set has more than two modes, we call it multi-modal

Note
The mode tells us the most common value in categorical data when the mean and median
can’t be used.
Unit - 04
Measures of Dispersion

The measures of location alone does not provide a complete or sufficient description of data.
In this section, we present descriptive numbers that measures the variability or spread of the
data set. Dispersion (variability, scatter, or spread) characterizes how stretched or squeezed a set
of data is.
A measure of statistical dispersion is a nonnegative real number that is zero if all the data are the
same and increases as the data become more diverse.

Example: Let us consider a simple example to show why a measure of dispersion is so important.
Consider two groups each of 6 students with their scores in a particular examination:

The arithmetic mean for each group is 50. It is very much apparent from the data that the first
group consists of average or near average intelligent students and the second group is made up
of very bright and very dull students.

There are many types of dispersion measures:

• Range

• Inter Quartile Range (IQR)

• Mean Deviation (MD)

• Variance/Standard Deviation

• Coefficient of variation (CV)

Range
Range is the difference between the largest and smallest observations.
i.e. Range = Largest value – Lowest value
The greater the spread of the data from the center of the distribution, the larger the range
will be. Since the range takes into account only the largest and smallest observations, it is
susceptible to considerable distortion if there is an unusual extreme observation.
The interquartile range (IQR) measures the spread in the middle 50% of the data; it is the
difference between the observation at Q3, the third quartile (or 75th percentile), and the
observation at Q1, the first quartile (or 25th percentile).
Thus, interquartile range IQR = Q3 – Q1

Mean Deviation (MD) or Mean Absolute deviation (MAD)

Mean deviation is used to compute how far the values in a data set are from the center point. the
mean deviation is used to calculate the average of the absolute deviations of the data from the
central point.
∑|𝑥𝑥−𝜇𝜇|
MD or MAD = 𝑛𝑛

Example
You and your friends have just measured the heights of your dogs (in millimeters):
The heights are: 600mm, 470mm, 170mm, 430mm and
300mm
Find the mean deviation
The heights are: 600mm, 470mm, 170mm, 430mm and
300mm
The mean: μ = ( 600 + 470 + 170 + 430 + 3005 = 1970)/ 5 = 394 mm

Standard Deviation or Variance

It is defined as the positive square-root of the arithmetic mean of the Square of the deviations of
the given observation from their arithmetic mean. The standard deviation is denoted by s in case
of sample and Greek letter σ (sigma) in case of population. The formula for calculating standard
deviation is as follows:

S = Sample standard deviation

𝜎𝜎 = Population standard deviation
Variance is the square of standard deviation.

For frequency or grouped frequency distribution

𝑓𝑓(𝑥𝑥 − 𝑥𝑥̅ )2 𝑓𝑓(𝑥𝑥 − 𝜇𝜇)2

𝑆𝑆 = � 𝜎𝜎 = �
∑ 𝑓𝑓 − 1 ∑ 𝑓𝑓
Note that throughout the course we will use

(𝑥𝑥 − 𝑥𝑥̅ )2 ∑ 𝑥𝑥 2
𝜎𝜎 = � = � − (𝑥𝑥̅ )2
𝑛𝑛 𝑛𝑛

𝑓𝑓(𝑥𝑥−𝑥𝑥̅ )2 ∑ 𝑓𝑓𝑥𝑥 2
OR 𝜎𝜎 = � = � − (𝑥𝑥̅ )2 for frequency distribution
𝑛𝑛 𝑛𝑛

Coefficient of variation
Coefficient of variation is a type of relative measure of dispersion. It is expressed as the ratio of
the standard deviation to the mean. The coefficient of variation is a dimensionless quantity and is
usually given as a percentage. It helps to compare two data sets on the basis of the degree of
variation. If there are data sets that have different units then the best way to draw a comparison
between them is by using the coefficient of variation. The higher the CV, the greater the
dispersion.
𝜎𝜎 𝜎𝜎
𝐶𝐶. 𝑉𝑉. = 𝜇𝜇 × 100% = 𝑥𝑥̅
× 100%

Five Number Summary & Box and Whisker Plot

A five-number summary is especially useful in descriptive analyses or during the preliminary

investigation of a large data set. A summary consists of five values: the most extreme values in the
data set (the maximum and minimum values), the lower and upper quartiles, and the median.
These values are presented together and ordered from lowest to highest: minimum value, lower
quartile (Q1), median value (Q2), upper quartile (Q3), maximum value.
These values have been selected to give a summary of a data set because each value describes a
specific part of a data set: the median identifies the centre of a data set; the upper and lower
quartiles span the middle half of a data set; and the highest and lowest observations provide
additional information about the actual dispersion of the data. This makes the five-number
summary a useful measure of spread.
A five-number summary can be represented in a diagram known as a box and whisker plot. In
cases where we have more than one data set to analyze, a five-number summary with a
corresponding box and whisker plot is constructed for each.