Tips for Mathematics

General Algebraic Rules

(a ± b)2 = a2 ± 2ab + b2 . a2 – b2 = (a + b) (a – b) (a2 + b2) = 21 [(a + b)2 + (a – b)2] (a  b) 2  (a  b) 2  4ab

(a + b)3 = a3 + b3 + 3ab (a + b). (a – b)3 = a3 – b3 – 3ab (a – b) (a3 + b3) = (a + b) (a2 – ab + b2).

(a3 – b3) = (a – b) (a2 + ab + b2) (a + b + c)2 = a2 + b2 + c2 + 2 (ab + bc + ca).

Ratio
a
If ratio is a : b  then Duplicate ratio= a2 : b2 Sub duplicate ratio= a : b
b
Triplicate ratio=a3 : b3 Sub triplicate ratio= 3 a : 3 b Compound ratio of a:b and c:d is ac: bd

Proportion

a : b=c: d then a ,b, c and d are 1st ,2nd , 3rd and 4th proportional.
Continued Proportion
a b
(i) a : b = b : c   .and a, c are 1st and 3rd proportions, b is mean proportion.
b c
( Mean) 2 b2
(ii) 3rd proportion c = 
1st proportion a
(iii) Mean proportion (b) = 1st proportion  3rd proportion  a c .

Laws of Indices
m n m+n m n m–n m n mn
a .a =a , a /a =a , (a ) = a (ab)m = am bm ,
m m
1   a a
a–m = m
,    m
m , a = b
m
 a = b, am = an  m = n
a b
  b
x y
If net sum of powers = 0, then result = 1, like a . a y x . a z  x  1
nm m n
am = bm and a  b then m = 0 a m = b n then a  b  b .

Logarithm
p
If log b N = p then b = N . Normally base (b) = 10 ( Common ) for calculus, b = e ( where e = constant )

(A) Properties (fixed base) :

a
(i) log a + log b = log (ab ) (ii) log a – log b = log   (iii) log a m = m log a
b
(iv)log b b = 1 (i.e. log 10 = 1, commonly in algebra and log e = 1, in calculus )

(v) log 5 = 1 – log 2. (w.r.t base = 10 ) (vi) log 1 = 0. (vii) b log b N  N b m log b N  N m

n 3
(vi) log an 
log b a , like log 2 a 3  log b a .
bn m b 2
log x 1
(B) Change of base : (i) log y x  , (ii)  log x y , (iii) log b a × log a c = log b c
log y log y x
log 3 2
Note :(a)log 3 + log 2 = log 6 (  log 5 ). (b)  log 2 3 ( log 3 – log 2 ) (c)log x ) = (log x ) (log x ) ( 2 log x )
log 2
(d) log x = log y  x = y (if base is same )

Equations
1. Conditions of Two Equations. Two equations a1 x + b1 y + c1 = 0, a 2 x + b2 y + c 2 = 0 have
a1 b a1 b c
(i) Unique solution if  1 . (ii) Infinite solutions if  1  1 .
a2 b2 a2 b2 c2
a1 b1 c1
(iii) No solution if   . i.e. if a 1 b 2 = a 2 b1.
a2 b2 c2
2. Quadratic Equation. ax 2 + bx + c = 0. has two solutions of x (i.e. two roots of x ):
b D
x= (=  ,  ) where D = b2 – 4 ac
2a
# If b = 0, then two roots ,  are equal but opposite in sign.
 1
# If c = a, then ,  are reciprocal  i.e.   . #If one root  = m + n , then other root  = m − n .
  
# If two roots are known then, Quadratic equation is x2 – ( Sum of roots ) x + (Product of roots ) = 0
Nature of roots

D>0 D=0 D<0

 ,  are real  ,  are non – real
and equal unequal
i.e. b2 = 4ac

D is perfect square D is not perfect square

(,  unequal, rational) (,  unequal irrational)

Linear Inequality
1 1
(i) If a > b then −a < −b &  etc. (ii) | x | > b  x > b Or x < −b. (iii) | x | < b  −b < x < b.
a b
(iv) For graph , shade the region whose any point satisfies the inequality ≤ means usually towards origin i.e.(0, 0 )
should satisfy it and ≥ sign means away from the origin.
* In graph of linear inequality,

≥ sign ≤ sign

Simple interest & Compound interest & Annuity

Pr t rt 
Simple Interest (SI) = and Amount= P  1   [ P = Principal = rate of interest per annum and t = time in years]
100  100 
n 2n
 r   r 
Compound Interest (i)A = P1   ( Annually Compounded ) ,(ii) A = P1   ( Half yearly Compounded )
 100   200 
4n 12 n
 r   r 
(iii)A = P1   (Quarterly Compounded ), (iv)A = P1   ( Monthly Compounded )
 400   1200 
where A = Future Amount , P = Principal (Present value )
n
 r  
Compound Interest CI = A  P = P  1    1 (compounded annually)
 100  
1
Effective Rate: To find C.I. from P = 100 and for one year. Compound Annual Growth Rate (CAGR)= r %=  EV  n
  1
 PV 
n
 r 
Depreciation : Scrap Value = P1   where r = annual rate of depreciation and P= original price
 100 
2
 Annuity: (Installment payment with Compound Interest)

Future Value (F.V) (for investments) Present Value (P.V) (for repayments)
Types of Annuity

Regular Annuity Annuity Due ( if instalment given from the

( instalment paid at the end of each period(Mostly used)) beginning of each period)
Formula for REGULAR ANNUITY:
A A  1 
F.V. = {(1  i ) n  1} P.V. = 1  
i i  (1  i ) n 
A
( F.V. means total accumulated {1  (1  i )  n } ( P.V. mean total loan or cash down value )
=
i
fund or maturity value ) ( A = Instalment repayment )
r
( P = Instalment payment size = Annuity) i = Adjusted rate of interest like for half yearly etc. & n = No. of
200
instalments )
For Annuity due multiply all the formula with (1+i ) if instalment is annual.

Permutation and Combination

Permutation (means number of arrangements) (eg, Word, Number, Sitting, Placement)
n n!
Pr  =n (n – 1 ) (n – 2 )-------- (n – r + 1) (i.e. r factors )
(n  r )!
n
= No. of arrangements of n different things taken r at a time). n! = m! if n = 1, m = 0 or m = 1, n = 0 Pn  n ! 0! =1

Note : (i) AND  Multiply OR  Add

(a) No. of Rearrangements = No. of Arrangements – 1.

(b)If some objects are always together, take them as one object & multiply their arrangement with total
arrangements
(c) TAN Rule Total − Always together = Never Together
n  m 1
(d) If n objects to be arranged in which m particular objects are always together Pn m 1  m !
n!
(e) No. of arrangements of n things with p, q, r alike objects =
p !q !r !
(f) Circular Rule : Number of arrangements =(n – 1)!, ( ring or round table etc.)
for necklace No. of necklaces = 12 (n – 1)!
(f) n objects are to be arranged taken r at a time with repetition = n r.
Combination (Number of selections ) (e.g., Team, Committee, Group)
n n!
Cr  = No. of selections of n things taken r at a time
(n  r )! r !

n
Rules: If n C x  n C y then x  y Or , x  y  n n 1 n n
Cr  Cr  Cr 1 C r  n C nr

(i) n different objects to be selected any number at a time, then number of selections
= n C1  n C2  n C3 .........  n Cn = (2 n – 1).

(ii)Among n persons, number of handshakes= n C 2 (ii) For n sided polygon has ( n C2  n ) diagonals
(iii) m different parallel straight lines intersected with n different parallel st. lines then Number of different parallelogram
= m C2  n C 2
# At least  Minimum # At most  Maximum At least one object to be selected = TNA Rule
# Number of selections of n different objects taken r at a time such that
n m n m
(i) m objects are always present = C r m (iu) m objects are never present = Cr

Arithmetic Progression (AP)& Geometric Progression (GP)

AP  Common difference that is d =T 2 −T1 =T3−T2 etc. GP  Common ratio that is r = T 2 /T1 =T3/T2 etc
A.P. G.P.
2 3
Terms : a, a+d, a+2d, …; Terms : a, ar, ar , ar ,…;
nth term, Tn = a + (n – 1) d, T2 T3
r = common ratio =  etc.
T  a T1 T2
n=  n  1
 d  n-th term= a(r) n−1
Tn  a Tm  Tn Tm
d = r mn 
n 1 mn Tn
b) Sum of n terms(S n) b) Sum of n terms
n n
a(r  1)
= [2a +(n – 1)d] (Sn )  (r  1) or, (r <1)
2 (r  1)
n
= ( 1st term +last term) a(1  r n ) a(1  r ) a  r
n
2 or, =  (-1≤r<1)
1 r (1  r ) 1 r
c) One AM between a & c) One G.M. between a and b = ab
b= 21 (a+b)
d) For m AMs or m GM s between a and b then b= (m+2)th term of the
sequence
T n = Sn – Sn – 1
T1 = S1 & T2 = S 2 −S 1
Important Summation : (a) Sum of n natural numbers, 1 + 2 + 3 +…. + n = 12 n(n  1)
(b) Sum of squares of n natural no.s, 12 + 22 + 32 +...+n2 = 16 n (n  1)(2n  1)
2
(c) Sum of cubes of n natural numbers, 13 + 23 + 33 + …+ n3 =  12 n (n  1)
a
(d) Infinite GP Sum of infinite GP = a+ ar + ar 2 +……………. = where − 1≤ r < 1.
1 r

Set Theory
Cardinal Number of a set is size of the set A = n(A) For Empty Set or null set { }= 

Number of subsets of a set whose cardinal number is n to be 2 n and number of proper subsets = 2 n −1
Power set = Set of all subsets of a set i.e. 2 n subsets in power set

A∩B A/ ∩ B
A ∩ B/

De Morgan’s Law : (A  B) / = A/  B/ (A  B) / = A/  B/
Difference property A−B = A B & B−A = B A /
/

Total number of elements:

For two sets: n(A  B) = n (A) + n (B) – n (A  B)
For three sets: n (ABC) = [n (A) + n (B) + n (C)]– n (A B ) − n(B C ) −n C A )+ n (A  B  C).
. n[Only A] = n (A ) – n (A  B ) − n (AC )+ n (A  B  C )
n[only A, B but not C] = n (A  B ) – n (A  B  C)
Product Set: AB = {(a, b) where a  A and b  B} BA  AB but n (AB) = n (BA)
Relation (R ) : R  (A × B ). i.e. R is sub- set of some ordered pairs of the set (A × B ).
R be may one to one, many to one or one to many , but Mapping is one to one or many to one.
Types of Relations (R ) : (1) Reflexive : (a, a )  R for all a  A. (eg. parallel congruent  etc.)
(2) Symmetric : (a, b )  R  (b, a )  R for all a, b  A. (eg. reciprocal, perpendicular or | a – b | = K )
4
 (3) Transitive : (a, b )  R and (b, c )  R then (a, c )  R for all a, b, c  A (eg. greater than relation , smaller
than relation etc).
(4) Equivalence : R is Reflexive, Symmetric and Transitive. (eg. parallel to, equal to )
Mapping or Functions (f ) or f (x ) f  R (i.e. Subset of Relation is Mapping.)
Note. (i) one to one relation  Injective Mapping. ( only one x exists for each y )
(ii) f: A  B such that f (x) = y, then A  Domain set, B  Co-domain set & f (x) = y  Range set .
f (x) = y is the set of outputs or results from given x.
(iii) If f (x) =B  Subjective Mapping or ‘on to Mapping’ (i.e. all elements of B are in y i.e. f (x) )
Y  B (i.e. some elements of B are not in y ) then ‘into mapping’
(iv) If ‘f ‘ is onto and one to one then it is Bijective Mapping.
# g o f (x) = g {f (x)} [ put f (x) in place of x in g (x)]
f o g (x) = f {g (x)} [ put g (x) in place of x in f (x)].
# Inverse Mapping : If f (x) = k , then x = f – 1 (k ). [ write x in place of k in the expression of f – 1 (k ).]
Matrix & Determinant
Order of Matrix = Size = (No. of Rows × No. of Column )
# Transpose of A T  Interchange Rows & Columns
# If order of two matrices are same they can be added or Subtracted .
# K × A  each position be multiplied with K where K = constant number
# Product of two matrices  ∑ (row x column ) i.e. Row – Column Combination.
Condition . No. of columns of A = No. of rows of B for conformity of AxB.
Order of AB= No. of rows of x No. of columns of B
Generally AxB BxA
# Identity Matrix It is a square matrix with all Zeros except principal diagonal will be 1 . # I.A= A.I =A
I3  (3 × 3) and I 2  (2 × 2).
a b c
a b
# Determinant = ad – bc. l m n = a (mr – qn ) – b (l r – p n ) + c (lq – mp )
c d
p q r
# If Det = 0, matrix is Singular Matrix. Adjoint or Adjugate = (Cofactors )T
1
# A–1 = (Adj A ) ( Provided Det  0 ) A A – 1 = A – 1 A = I and (A – 1 ) – 1 = A
Det
# Solving Equation X = (unknowns ) = A – 1 B, where A= Coefficient Matrix, B=RHS

# Orthogonal Matrix. If A × AT = I = AT × A.

# Symmetric Matrix. AT = A # Skew – symmetric Matrix, AT = − A.

D Dy Dy
Cramer’s Rule Using determinant: x= x ,y = ,z = ,
D D D
Cramer’s rule can be applied only if D0

Derivative
d d  1  n d d d 1
(x n ) = n x n – 1   = n 1 (k) = 0 (x) = 1 Short Notes :- ( x)=
dx dx  x n  x dx dx dx 2 x
Product Rule:- derivative of product of 2 functions f(x).g(x) = gf /+fg / [( / ) denotes derivative ]
f g f   fg  dy dy du dy dy / dt
Division Rule:- derivative of  2
Chain Rule:-   x, y are functions of t then 
g g dx du dx dx dx / dt
Function Derivative
[ f (x)] n n [ f (x)] n – 1 f /(x)
1
f (x ) f /(x)
2 f (x )
ef(x) e f ( x ) f / (x)
ax a f (x) f / (x) log e a
1
log f (x) . f (x )
f (x )

Differential Calculus ( application )

Total Cost (T.C. ) : = F. C. + V.C.
Where x is the output or quantity and F.C. (fixed cost ) = Terms without x
T .C.
V.C. (Variable cost ) =Terms without x A.C. (Average Cost ) =
x
V .C. d
AVC (Average variable cost ) = M.C. ( Marginal Cost ) = (T .C.)
x dx
Selling Price (Per unit ) = p = demand function. Total Revenue (T.R.) = p.x Profit = (T.R. – T.C. )
For Break even point: T.C.=T.R.

Integration
n 1 n 1 kx
x x e
1.  x n dx   c, 2.  x 1 dx  log x  c, 3.  1 dx  x  c , 4.  k x n dx  k  c, 5.  ek x dx  c
n 1 n 1 k
kx
a
6.  ak x dx  c Note:-  e x dx  e x  c.
k log a
n 1 n 1
(x  k) 1  ax  b 
Special Case:-(1)  ( x  k )n dx  c (2).  ( x  k )1 dx  log ( x  k )  c (3)  ( ax  b)n dx   c,
n 1 a n 1
/ /
1 1 f (x ) f (x ) dx
(4).   ax  b  dx  log (ax  b)  c Note: - (a)  dx  log f ( x ) + c (b)   2 f (x )  c
a f (x ) f (x )
N R
[ If degree of Numerator  that of denominator, then divide and write as  Q  , then integrate.]
D D
[ f ( x )]n 
Substitution:- f ( x )  z = f (x), dz = f / (x) dx [Check f / (x) must be adjusted]
e 
du
Integration By Parts. ( Product rule)  uv dx = u  v dx    
 v dx  dx (LAE Rule)
 dx
x x
Special Rule: e [ f ( x )  f ( x )] dx  e f ( x )  c

dx 1
Rational fraction or Partial fraction:- (a)  ( x  a)( x  b)  a  b [log (x – a) – log (x – b)], where a > b

b b
Definite Integral:- If  f (x)dx  (x) then where  f ( x) dx   (b)   (a)
a a
a a a a
f (x ) a
Properties. (i)  dx  (ii)  f (x )dx  0 provided f (– x) = – f (x) (iii)  f (x )dx  2  f (x ) if f (–x) = f (x)
0 f (x )  f (a  x ) 2 a a 0

6
 Tips for Statistics

Introduction of Statistics.
Statistics  data (plural sense ) and scientific method ( singular sense )
Limitation : Statistics deals with aggregate and an individual information has no significance
Future projections made by statistics may be not accurate. i.e. Statistical results are mostly associated with some error.
Type of data

Qualitative(Attribute) Quantitative (Variable)

(Non – Measurable (Measurable )
like Gender, Colour,
Religion, Nationality
etc.) Discrete Continuous
(isolated & fixed values) (any value in any given interval )
(No. of phones, no. of (Height, Weight, Age, Income
Petals, Runs scored, etc.).
Wickets taken etc.).
Collection of data

Primary [First hand data] Secondary [Second hand data]

(Directly collected from (Collected from already existing source )
the field of enquiry )

Direct interview, Sources are Census or RBI. report,

Telephonic inter-view Municipal Corporation report Or,
E – mail responses. Government publications or data collected from internet.
Method of Collection of Primary Data.
(i)Interview Method :
(a) Direct or Personal (used for natural calamity ),(b) Indirect ( used for accidents ),
(c) Using Telephone (quick and cheap method but having problems of non – responses )
(ii) Mailed questionnaire method, (iii) observation method, (iv) Questionnaires filed and sent by enumerators
Classification of data
4 types of classification (i) Ordinal (Qualitative ), (ii) Cardinal (Quantitative ),
(iii)Geographical or Spatial (like data from different countries )
(iv) Chronological or Temporal or Time Series data (like data collected in different months )
# Mode of Presentation  (i) Textual, (ii) Tabular (iii) Diagrammatic.
Tabular representation or Tabulation
Statistical Table has 4 points : (i) Caption ( upper part showing columns and sub – columns )
(ii) Box head ( Showing column, sub – columns, units etc ), (iii) Stub (row descriptions)
(iv) Body (main part showing numerical information.)
# Type of diagrams  (i) Line (1 dimension), (ii) Bar (2 dimension), (iii) Block or Cube diagram (3 dimension).
Line Diagram : (For Time Series data exhibiting wide range of fluctuations use Logarithmic or Ratio Chart ) To
compare two or more related time series data with same unit, Multiple Line Chart to be used.
Pie – Chart Or Circular Diagram Or Pie – Diagram is used to compare different components of variables [ Sub –
divided or component bar diagram may also be used but Pie – chart is better].
 individual Value  0
Central Angle for Pie – Chart =    360
 Total 
NOTE:(i)Pie diagram is one dimensional (but if compared with line diagram, Pie -diagram is not taken as 1 dimensional.)
(ii) Bar Diagram

Horizontal Vertical
(Qualitative data like (Quantitative profit, Income etc.)
Merit, Beauty etc.)
( it varies over space)
(iii) Pie – Chart or Diagram may be used to compare budget or different segments of the data.

Grouped Frequency distribution

Inclusive Class Exclusive Class

(Class Limits) (Class Boundary)
(Both ends are included) (Upper end is excluded)
1
CB = CL  d Where d = gap between two successive classes.
2
No. of Class intervals × length of each class = Range i.e. highest value −lowest value
Overlapping Class Intervals = Exclusive class (upper end to be excluded ) i.e. class boundaries.(Used for
Histogram)
Non – overlapping Class Intervals = Inclusive class ( both end included ) i.e. class limits.
UCL  LCL UCB  LCB
# Mid value or Class mark = = .
2 2
#. Width or Size or Length of class = (UCB – LCB )
Class frequency Class frequency
# Frequency Density = . # Relative Frequency = (lies between 0 to 1 ).
Class width Total frequency
Frequency Curve (i)Bell shaped ( mostly used ),(ii)U shape (no. of daily passengers ),
(iii) J shape ( less than Ogive while more than Ogive is inverted J) ,(iv) Mixed Curve
Graphical representation of frequency distribution

Histogram (Frequency Ogive

(Area diagram ) Polygon ) Cumulative frequency curve)

To be used for Line diagram Two Ogives ( J shaped )

for mode (rectangular
shapes ) Less than More than
(Up ward ) (Down ward ) (Based on Class boundary)
(To be used for Quartiles ) ( Median requires both types of ogives)
Histogram (Area diagram ) = Exclusive or Overlapping Classes are required and for unequal classes use frequency
density are taken along y-axis.
Frequening Polygon = Joining mid – points of class interval starting and ending on the x – axis
(Note : Class lengths or widths must be same )
Frequency Curve :Limiting from of frequency polygon.
Ogives or Cumulative Frequency Graph. ( Two types are less than and more than ): Plotting c. f. on y axis and
class boundaries on the X axis.
Less than Ogive is required for Quartiles while intersection of two Ogives give median. (Median is corresponding to x
for the intersection point of two Ogives on the X axis)
Measures of Central Tendency
Central Value  most important value of a given of observation which can represent the whole set.
Central Value

Mean (Average) Median Mode

most frequent value
Value of (n+1)/2 th
A.M.( x ) G.M. H.M. rank (ascending or
descending )
 x Or  fx (x , x …x )1/ n n
1 2 n
n f 1
  x 
For a set of n distinct positive values, A.M. > G.M. > H.M.
For a set of same values, A.M.= G.M.= H.M. Generally, A.M. ≥ G.M. ≥ H.M.
For two values, A.M × H.M. = (G.M.)2.
If a set of data include any value equal to zero, only AM can be calculated.
x y
For two values x and y, AM= , GM = xy and HM= 2 xy
2 x y

8
Properties:
(i) Sum of deviations about Mean = 0. i.e. ∑ (X − X ) = 0.
(ii)Due to change of origin and due to change of scale Mean (A.M.), Median and Mode all will change
accordingly i.e. if all values are added / subtracted with same constant, Mean, Median or Mode will be also
changed.
Again, if all values are multiplied / divided with same constant, Mean, Median or Mode will be also changed.
For y = a + bx, a = origin change and b = scale change.
Put Mean or Median or Mode of x in the equation to get Mean, Median or Mode of y.
(iii) Sum of all data = ∑x = n x = (Number of data) × (Arithmetic Mean)
(iv) Product of all data = (x1 x 2 ………….. x n ) = (G.M. ) n
(v)A.M. of 1, 2, 3 …… n   n  1  .
 2 
 2n  1 
(vi)If values are 1, 2 …. n whose frequencies are 1, 2, 3 … n, then A .M. =  
 3 
1 1 1  2 
For 1, , , …….. , then H.M. =  .
2 3 n  n 1 

 n1 x 1  n 2 x 2  n1  n 2
(vii) Combined A.M. =   (Composite or pooled mean) Combined H.M. = n1 n 2
 n1  n 2  
  H1 H 2

 ( n x  wrong value  correct values 

(viii)Correction of mean =  .
 n 
(ix) Choice of Average

Usually A.M. is For percentage change, For rate per unit like speed, H.M. is used
applied like index number,
population change
G.M. is used
(x) Median is positional average, for grouped frequency, Median is calculated from the intersection of two
Ogives. i.e. x coordinate of the point of intersection of two Ogives = Median.
(xi) Mode is the intersection of diagonals of tallest Histogram.
(xii)Mode may be - more than one value. i.e. bi modal or modal etc. Also Mode may be not defined.
(xiii) For moderately skewed (i.e. Mean. Mode, Median are unequal)
Mean – Mode = 3 (Mean – Median ) or, Mode = 3 Median – 2 Mean.
(xiv)Fractiles or Partition or Percentiles
(n  1) K
PK = th value of ascending data (K th Percentile ) (Dividing in 100 parts) (K=1, 2… 99)
100
(n  1) K
DK = th value of ascending data (k th decile ) (K = 1, 2…. 9 dividing in 10 parts).
10
 n 1 3 (n 1)
Q1 = Lower Quartile=   th ascending value, Q 3 = Upper Quartile = th ascending value,
 4  4
Q 2 = Median = (n+1)/2 th ascending value.
(xv) P10 = D1 , P20 = D2 …… , P90 = D9, P25 = Q 1 , P75 = Q 3 D5 = P50 = Q 2 = Median
(xvi) Quartiles for grouped frequency distributions less than type Ogive may be used.

Measures of Dispersion
Dispersion ( Also called Central Tendency of 2nd Order)
(measure of Scatteredness or Variability or amount of deviation from the Central Tendency )

Absolute Relative
( Non negative result (No unit generally percentage measurement
dependent on unit ) to compare two or more of data )
Measurement Absolute formula Relative formula (Coefficient )
(1) Range (R x ) (Max – Min )
Max  Min
for class interval (HCB – LCB )  100
Max  Min

1 Q3  Q1
(2)Quartile Deviation(Q.Dx) SIQR = (Q3 − Q1 )  100 or
2 Q3  Q1
QD
(Semi – inter Quartile Range) 100
Median
IQR = 2 ( QD)
QD represents middle 50% of the data

1 MD x
(3) Mean Deviation (MDx ) ∑|d| 100
n M
(to take absolute where d = x – M
deviation. i.e. non – M = Mean or Median or Mode.
negative deviation (Note: MD is minimum if measured from median i.e. where d = |x – Median|

d 2 SD
(4) Standard Deviation where( SDx or,  x ) Coefficient of variation(c.v. ) =  100
n Mean
d = (x − x )
2
x 2
( 2nd central moment) = variance =  x 2 = SD
n
If c.v. higher then , consistency lower

Note : Variance = (SD )2 ∑ d 2 = Sum of squares of deviation about x ∑ x 2 = Sum of squares of values

Properties: (i) If all values are constant (i.e. fixed) s.d. = 0.

(ii) For change of origin, Range, QD, MD and SD do not change but due to change of scale Range, QD,
MD, SD always change accordingly (Non – Negative change)
If y = a + bx , then R y = | b | R x , QDy = | b | QD x , MD y = | b | MD x ,SD y = | b | SD x .
Note: Variance (a + bx ) = b 2. Variance (x).
n 2 1
(iii)For 1st n natural numbers ( i.e. 1, 2, …….. n ) SD =
12
1
(iv)For two values a and b ( a > b ). SD = MD = (a – b )
2
1
Note : For two values with same occurrences apply SD =MD= (a – b ).
2
n1 ( 12  d12 )  n2 ( 22  d 22 )
(v)For two groups pooled or combined SD= .
n1  n2

n1s12  n2 s22
Note: If x 1 = x 2 , Combined SD = .
n1  n2
(v) For Normal or Symmetric Distribution Q.D. = Probable Error of S.D. & 2 S.D. = 3 Q.D.

10
 Correlation
Degree and nature of association between two or more variables  Correlation.
Scatter Diagram  Graphical Analysis of Correlation
Coefficient of correlation (Denoted by r) Numerical measurement of correlation (only linear relationships
examined ).
If x and y changes in the same direction, there is positive correlation and if x and y changes in the opposite
direction , there will be negative correlation. [ Like price and demand are in negative correlation while
expenditure and income are positively correlated.]
If x and y are lying in a straight line they are perfectly correlated.
If there is no significant relative change between two variable they are uncorrelated.[ Like size of shoe and
income]
Spurious correlation means no real association but due to any other factors.
Properties of Coefficient of Correlation ( r ) : (i) −1 ≤ r ≤1
(ii) r is independent of change of origin and change of scale but sign of r depends on relative signs of
two variables.
(iii) r is a pure number and it has no unit.

Coefficient of Correlation

Karl Person’s Rank Concurrent

Coefficient Correlation Deviation
(Product moment method ) (Spearman’s method) (Change of sign)
(Quantitative technique ) (Qualitative technique)
(Generally applied )

(A) Karl Person’s Method : r =

Cov ( x, y )

 ( x  x )( y  y )
xy 2 2
 ( x  x)  ( y  y)

Cov (x, y ) =
 (x  x ) ( y  y ) (n = No. of pairs of data.) Cov (x,y) = r  x  y
n
Note : (i) Sum of product of deviations of x, y from their means = ∑ ( x − x ) ( y − y )
∑ ( x – x ) 2 = Sum of squares of deviations of x about x .
(ii) If u = ax + b and v = cy + d, a, c are scale change, then
r (u, v ) =  r (x, y ),if a, c have same sign Or opposite sign.

Rank Correlation Coefficient

Without Tie With Tie

 6 d 2   6 d 2  6 C F. 
r  1  r  1  
 n3  n   n3  n 
   
Where d = Rank (x) – Rank (y ), ∑ d = Sum of difference of ranks, ∑d 2 = Sum of square of difference of ranks,
3
CF = Correlation factor =   t  t  , where t = No. of lies in each Tie.
 12 
 
 2c  m 
Concurrent Deviation r      m = n – 1,c = No. of concurrent (or identical ) sign changes of x, y
 m 
[  Sign as per sign of (2c – m )]
Concepts (a) If Cov (x, y ) = 0, r x y = 0 (b) If Cov (x, y ) > 0, r x y > 0 If Cov (x, y ) < 0, r x y < 0
(c) Product of  x and  y is always greater than covariance (x, y)
(d) If n = 2, r = 1 if x, y are changing in the same direction.
r = −1 if x, y are changing in the opposite sense and
r = 0 if y does not change.
(e) Sum of difference of ranks is always =0 i.e. ∑ d = 0
(f) If ranks are in the opposite sense value of r = −1 and if ranks are in the same sense r = 1 .

11

Regression
Regression means prediction using method of least squares to find the lines of best fit.
Two regression equations as one Variable is dependent (unknown) and other one is independent (known ).
RegressionEquation

y on x x on y
(y unknown, x known) (x unknown, y known)
y − y = byx (x − x ) x − x = bxy (y − y )
x , y are the means of x, y respectively. Regression Coefficients are byx and bxy
Regressions Coefficients
Cov ( x, y ) y
b yx = =r (= y on x regression coefficient )= Slope of y on x regression,
Variance ( x ) x
Cov ( x, y ) 
b xy = = r x (= x on y regression coefficient ) Slope of x on y regression = 1/ b x
Variance ( y ) y
Properties of Regressions :
(1) Two regression lines intersect at mean of x and mean of y i.e. ( x, y ) is the point of intersection.
( i.e. common value of x,y of two equations are mean of x and y.
(2) r   byx. bxy i.e. correlation coefficient is the G.M. of two regression coefficients.
(3) A.M. of bxy and byx ≥ r.
(4) Sign of byx and bxy must be same as sign of r.
(5) Product of regression coefficients can not exceed 1. i.e. byx . bxy ≤ 1.
(6) Slope of Y on X regression equation = byx.
(7) If r =  1, two regression lines coincide. ( i.e. identical )
& If r = 0, two regression lines are perpendicular or at right angle
(8) If only one regression equation exists between x and y, then r = 1, if slope is positive (up ward line )
= −1, if slope is negative (down ward line )
(9) Regression coefficients depend on change of scale but are independent of change of origin.
a a
by x = b u v and b x y= b v u where u = ax + b and v = cy + d .
c c
(10) Identification: Two Regression equations be a1 x  b1 y  c and a 2 x  b2 y  c 2 then 1st equation is x on y
and 2nd equation is y on x if a1b2  a 2 b1 otherwise choice is reverse.
(11) If y = a + bx is the Regression Equation of y on x , then b = Regression Coefficient of y on x .
If x = a / + b/ y is the Regression Equation of x on y, then b / = Regression Coefficient of x on y.
Coefficient of Determination :

Explained Variance
r2 = = Coefficient of determination
Total Variance

1 – r 2 = Coefficient of non – determination

= ratio of unexplained variance to the total variance i.e., proportion (or % ) of variance unaccounted for.
1 r 2
Standard Error of r =
n
1 r 2
Probable Error (P.E.) of r = 0.6745 where r= Correlation coefficient from n pairs of sample data.
n
2
PE= S.E
3

The limit of the correlation coefficient of the population = r  PE

12
 Probability
Probability means chance or possibility.

Classical concept Axiomatic (Modern) concept

m = No. of favourables (i) P (A) > 0,(ii) P ( S ) = 1
n (Total exhaustive cases )
(iii) P (A or B ) = P (A ) + P (B ),
if A, B are Mutually Exclusive events
Probability of Non – occurrence = 1 – Prob. of occurrence. i.e. P ( A ) or P (AC ) = 1 – P(A)
Odd in favour of an event = happening : Non – happening = m : (n  m) = p : q
p
Odds against an event = non – happening : happening = (n – m ) : m = q : p Probability =
pq
n
Cx
# Probabilities of x heads (or, x tails ) from n tosses = .
2n
( Sum  1 ) ( 13  sum )
# Probability of sum of two Dice :(i) ( Sum ≤ 7 ) (ii) ( Sum ≥ 8 ).
36 36

# Probability of taking at least one = 1 – Probability of taking None.

Set Concepts of Probability Notation A  B = A + B, A  B = AB.

(1) P (A  B ) = P (A) + P (B ) – P (A  B ). (2) P (A  BC ) = P ( A ) – P (A  B ).
(3) P (B  AC ) = P (B ) – P (A  B ). (4) P (AC  BC ) = 1 – P (A  B ).
P( A  B )
(5) P (AC  BC ) = 1 – P (A  B ). (6) P (A / B ) =
P( B )
P( A  B )
P(B / A ) = .
P( A )
(7) Two events A, B are independent then P (A  B) = P (A ) × P (B ).
[i.e. Two events can happen together without affecting other’s chance ]
(8) Two events A and B are mutually exclusive ( Incompatible Event) then, P (A  B ) = 0
[i.e. Two events can not happen together ]
(9) Two events A, B are exhaustive then, P (A  B ) = 1 [i.e. one of the events must happen ]
(10) Two events are equally likely then, P (A ) = P (B ).
Note : For three events A, B, C to be independent P (A  B  C ) =P(A)× P(B )× P(C).
For two events probability of at least one event = 1− probability of none will happen.
For two events,
Probability of any one ( exactly one i.e. only one happen ) =( Happen × Not happen) +( Not happen × happen )

Random Variable and Expectation

If x be a Random variable depends on chance then, distribution has ∑ p = 1.

Mathematical Expectation of X, E(x) = ∑ x. p.
Properties: (i) Mean = Expectation = E (x) = ∑ x. p (ii) E (x 2 ) = ∑ x 2. p
2 2 2
(iii) V (x) = E{x−E(x)} = E (x ) – {E (x )} (iv) E (c ) = 0, if c = constant.
(v) E (a + bx ) = a + b E (x) (vi) E (x  y ) = E (x)  E (y )
(vii) For Two independent variables x , y E (x y ) = E (x) E (y )
[Note : expected number of a die rolled once = 3. 5]
n 1
Similarly for Uniform Distribuion having n equally likely cases, Expected mean = ]
2

13

Theoretical Distribution

Discrete (isolated values) Continuous ( any value)

Binomial Poisson ( rare accidental events) Bell shaped Non Bell shaped
( Success & failures) like phone calls, misprints etc) Normal Distr. & t-Distr. Chi Square & F Distr.
finite values infinite values (Normal is applied
mostly for wage, profit,
income,height,weight etc.)
Binomial Distribution
X B (n, p) i.e. two parameters (n, p). p.m.f: `P(X=x) =f(x) = n C x p x q n x where x= 0, 1, 2,...n
Properties:
1. Mean = E (x) = np.
2. Variance = V(x) = npq = np (1 – p) = 2nd order Central Moment Mean > Variance.
3. If p =1/2, distribution is symmetric when variance is maximum and the maximum value of variance =n / 4.
4. S.D. = npq .
5. Mode = M0

One Mode Two Modes

If [(n + 1)p] has If [(n +1)p] has no
decimal part, delete decimal parts
decimal part Two Modes are (n + 1)p and (n + 1)p – 1.
Poisson Distribution.
X P (m) i.e. one parameter =m where m= np (finite) if n is very large and p is very small.
e m m x
p.m.f: P(X=x) =f(x) = where x=0, 1, 2… 
x!
Properties: (a) mean=Variance=m
(b)If x  B (n, p ) such that, n is very large and p is very small ,such that, np is finite then x  P (m) where m = np.
(c)Mean = E (x) = m = Variance(x) (d) S.d. = m
(e) Mode

One Mode Two Modes

m has decimal part m has no decimal part
delete decimal part Two Modes are m, (m – 1)
Note : Mean is generally greater than Mode (i.e. Positive Skewness ).
Normal Distribution
( x )2

1 2 2
X N (  ,  2 ) i.e. two parameters  ,  2 . p.d.f is f ( x)  e where   x  
 2
Properties:(1) Normal curve is symmetric that it is always bell shaped.
(2) Mean = Median = Mode = ( Uni-modal)
(3) Variance =  2 [= 2nd Central Moment], S.D. =  (4) Distribution is Symmetric about  .
(5) Two points of inflexion are ( − ) , (  +  ) i.e. mean-sd and mean+sd .
(6) P( −  < x <  +  ) = 0. 6827 P( − 3 < x <  + 3 ) = 0. 9973 P(−  < x <  ) = 1
(7) 1st lower Quartile (Q1 ) =  − QD 3rd upper Quartile (Q 3 ) =  + QD (i.e. Two Quartiles are equidistant from )
(8) Q.D. = 0. 675 . M.D. about Mean = 0. 8  Note : 4S.D. = 5 M.D. = 6 Q.D.
(10) Additive Property.
X and Y are two independent Normal Variables with means  1 ,  2 and Variances  12 ,  22 respectively.
Then (x + y ) also follows Normal distribution with Mean =  1 +  2 and Variance=  12 +  22 i.e. x  N ( 1 ,  12 ),
y  N ( 2 ,  22 ) then (X + Y )  N ( 1 +  2,  12 +  22 ).
Standard Normal Distribution z  N (0, 1 ) i.e.  = 0, Var(z ) = 1, S.D. (z ) = 1

14
 Index Number
Average percentage change of price level of any country over a certain period is Index Number
Best average for Index Number is G.M. (But in practical problems A.M. is used )
Base year is the year whose Index or Price level = 100
 p1   q1 
Note. Price Relative (Pi ) =  100  for each item. Quantity Relative (Q i) =  
 q 100  for each item.
p
 0   0 
Index Number is denoted by I 0 n or I0 1 = (100  x ) % where x = percentage increase or decrease of price.

Index Number (Price Index )

Average Aggregative
Method (A.M. method) Method

Simple Weighted Simple Weighted

 Pi  Pi w  pi  100
 Pi w 100 (wi = weights or relative expenditure )
n w  p0  p0 w
# Cost of Living Index (C.L.I.) or Consumer Price Index (C.P.I.) =
 I w where I = group indices, w = weights
w
If information given with price and quantity (p,q) CLI=
 p1 q 0  100
 p0 q 0
Pr evious Salary
Expected salary calculated for current year = × 100 (current year C.L.I)
C.L.I . of Pr evious year
Dearness Allowance (D.A.) = Current year. Calculated salary – base year salary.
current year wage 1
Real wage (deflated wage ) = Purchasing Power=
current year C.L.I . (in % ) CLI
Note. Base year C.L.I. = 100
Current value Original Pr ice Index
# Deflated value = # Shifted Price Index = 100
(Pr ice Index of the current year ) Pr ice Index of the new base year
Splicing means joining two or more series of Index Numbers with different base years to a simple series having same base year.
Currentlink relative Pr evious year ChainIndex Current year Pr ice
Chain Base Index Number. = where Link relative = 100
100 Pr evious year Pr ice
Standard Formula :

Price index Quantity index

Laspeyres Index
 p1 q 0  100  q1 p 0  100
 p0 q 0  q0 p0
Paasche’s Index
 p1q1 100  q1 p1 100
 p 0 q1  q 0 p1
Fisher’s Index  p1q0   p1q1  100  q1 p0   q1 p1  100 F 2  L  P & 2B  L  P
 p 0 q 0  p 0 q1  q0 p 0  q 0 p1
Bowley’s Index 1   1 0   1 1  100 1   q1 p 0  q1 p1 
 pq p q 
 100
2   p 0 q 0  p0 q1  2   q 0 p 0  q 0 p1 

Marshall Edge worth Index  1 0 1  100  q1 ( p0  p1 ) 100

p (q  q )
 p 0 (q0  q1 )  q 0 ( p 0  p1 )
Note. (1)Laspeyres’ Price Index is weighted by base year quantities & Paasche’s Price Index is weighted by
current year quantities.
(2) Fisher’s Index is G.M. of Laspeyres’ and Paasche’s Index Number (Fisher’s Index is Ideal Index )
(3 ) Bowley’s Index is the A.M. of Laspeyres’ and Paasche’s Index Number.

Note. Laspeyres’ Price Index =

 p1 q 0  100 is also used for Cost of Living Index
 p0 q 0
or, Consumer Price Index or whole sale Price Index.

15

Test of Adequacy or Test of Consistency.

(1)Unit Test : Index Number Formula should not have any unit.
(2)Factor Reversal Test : For any formula, Price Index × Quantity Index =
 p1q1 = Value Relative.
 p0 q0
(3) Time Reversal Test : For Price Index I 01 × I10 = 1
(I 01 = Index Number of Current year, I 10 = Index Number of Base year ) Formula to be used without 100 )
(4)Circular Test :(Generalization of Time Reversal Test for more than 2 years ) 0, 1 × 11, 2 × 12, 3× …×1n – 1, n × 1n , 0 = 1.
Note. (i) Unit Test is satisfied by all formula except simple aggregative index.
(ii)Time Reversal Test is satisfied by Fisher and Marshall – Edgeworth Index Number while Factor Reversal
Test is satisfied by only Fisher Index Number.
(iv)Circular Test is none except simple G.M. of Price Relative or weighted Aggregative (with fixed weights )
can satisfy the test. Fisher’s Index is Ideal as it can satisfy all tests except Circular Test.
Time Series.
Time series data is chronologically arranged data.
Components of Time series

secular trend (T), Seasonal variation (S), Cyclical fluctuation (C) Irregular or random movement (I).
( long term) ( ≤ 1 year) (regular changes ) (sudden/ unforeseen)
Mathematical Models :
Additive Model :If yt is the time series value at time t then, yt = T + S + C + I
Where T is the trend value and S, C, l are seasonal, cyclical and random variations respectively at time t.
Multiplicative Model : yt = T × S × C × I.
Calculation of Trend

Free hand Semi – Average Moving Average Mathematical curve – fitting

method method method (Least – square) ( most effective method)
Line chart
Take average
of two equal unweighted weighted straight quadratic
half of given (Simple) line or parabolic
data odd
period

odd period even period

3years, 5years 4yearly, 6yearly

Linear Trend (LeastSquareMethod)

Tread Equation: y = a + bx where y = given time series data & x = deviations from origin year
Unit of x

for n =odd take unit of x = 1year for n = even take unit of x= 1 year i.e. 6 months
2
(Time is in consecutive years) (Time is in consecutive years)
Quadratic Trend

Trend equation : y = a + bx + cx2 ( x, y have same meaning as in linear trend)

To get a, b, c Solve three normal equations

Seasonal Variation

Semi or moving average method Ratio to trend method Link Relative method
 Quarterly Average 
Seasonal Index     100
 Grand Average 

16