STATISTICS:

Statistics may be defined as the science of the Collection, Presentation, Analysis and Interpretation of Numerical Facts and data. In other words we can say Statistics are the numerical statement of facts capable of analysis and interpretation and the science of statistics is the study of the principles and the methods applied in Collecting, presenting, analysis and interpreting the numerical data in any field of Inquiry.

APPLICATION OF STATISTICS IN DIFFERENT FIELDS:

Statistics plays a vital role in every fields of human activity. Statistics has important role in determining the existing position of per capita income, unemployment, population growth rate, housing, schooling medical facilities etcin a country. Now statistics holds a central position in almost every field like Industry, Commerce, Trade, Physics, Chemistry, Economics, Mathematics, Biology, Botany, Psychology, Astronomy etc, so application of statistics is very wide. Now we discuss some important fields in which statistics is commonly applied

In State Management (Administration):

Statistics is essential for a country. Different policies of the government are based on statistics. Suppose if the government wants to revise the pay scales of employees in view of an increase in the living cost, statistical methods will be used to determine the rise in the cost of living. Preparation of federal and provincial government budgets mainly depends upon statistics because it helps in estimating the expected expenditures and revenue from different sources. So statistics are the eyes of administration of the state.

In Economics:
Statistics play an important role in economics. Economics largely depends upon statistics. National income accounts are multipurpose indicators for the economists and administrators. Statistical methods are used for preparation of these accounts. In economics research statistical methods are used for collecting and analysis the data and testing hypothesis. The relationship between supply and demands is studies by statistical methods, the imports and exports, the inflation rate, the per capita income are the problems which require good knowledge of statistics

In Banking:
Statistics play an important role in banking. The banks make use of statistics for a number of purposes. The banks work on the principle that all the people who deposit their money with the banks do not withdraw it at the same time. The bank earns profits out of these deposits by lending to others on interest. The bankers use statistical approaches based on probability to estimate the numbers of depositors and their claims for a certain day

In Accounting and Auditing:

Accounting is impossible without exactness. But for decision making purpose, so much precision is not essential the decision may be taken on the basis of approximation, know as statistics. The correction of the values of current asserts is made on the basis of the purchasing power of money or the current value of it.

In auditing sampling techniques are commonly used. An auditor determines the sample size of the book to be audited on the basis of error.

In Natural and Social Sciences:

Statistics plays a vital role in almost all the natural and social sciences. Statistical methods are commonly used for analyzing the experiments results, testing their significance in Biology, Physics, Chemistry, Mathematics, Meteorology, Research chambers of commerce, Sociology, Business, Public Administration, Communication and Information Technology etc

Statistics In Medical Research:

In medical research, a common way to evaluate the effectiveness of a newly developed medicine is to administer it to one group of people or a animals and not to another group, called the control group. Statistics are collected from both groups, Organized, Analyzed and Interpreted before making a decision regarding the effectiveness of the new medicine.

Statistics In Marketing Management:

Statistics provide help to company launching a new product, in analyzing the correct data of consumer. Statistics also help the company to decide which advertising strategy will be more helpful in increasing the sales of product. Statistics also help the company to bring about an improvement in the quality and quantity of the products, according to the demand of the consumers.

Statistics In Finance:
Statistics provide help to investor in forecasting the future prospects of an investment before investing in it. So that he can expect maximum return for his investment and save himself from any loss.

Statistics In Other Areas

Statistics are commonly used by insurance companies, stock exchange, banks, public utility companies and so on. Statistics are also useful to politicians since they can predict chances for winning through the uses of statistical techniques.

MEASURE OF CENTRAL TENDENCY:

As we know that frequency distribution is a summarized form of statistical data and help us to study the data in a better form. But if we want to compare two or more sets of data, no comparison is possible unless and until we find a certain single representative value of the data. This representative value is called measure of central tendency where most of the values of the data have a tendency to lie around it. A measure of central tendency is also called an average and sometimes it is referred as measure of location.

TYPES OF AVERAGES:
The most common types of averages are: 1. 2. 3. 4. 5. Arithmetic Mean (or simple mean) Geometric Mean Harmonic Mean Median Mode

Arithmetic Mean:
The arithmetic mean is defined as the sum of all observations divided by the number of observations. If a set of n observations, then arithmetic mean is denoted by Formula for Ungrouped Data (read X bar).

Formula for Grouped O r Discrete Data

Note:

Arithmetic mean for a population data is computed in the same way but it is denoted by (the

Greek letter mu)

Geometric Mean:
Geometric mean can be defined in the following terms: Geometric mean is the nth positive root of the product of n positive given values Hence, geometric mean for a value of and given as under: containing values such as is denoted by

(For Ungrouped Data)

If we have a series of repeated

positive values with repeated values such as times respectively then geometric mean will becomes:
(For Grouped Data)

are

Where When n is large (i.e. greater than two) the computation of geometric mean becomes difficult by this formula. Making use of logarithms, the formula of geometric mean becomes as
For Ungrouped Data For Grouped Data

Note: If any value is zero or negative, then the geometric mean is not computed
The harmonic mean is one of several kinds of Average. Typically, it is appropriate for situations when the average of rates is desired. Harmonic mean in mathematical terms is defined as follows:
For Ungrouped Data For Grouped Data

MEDIAN:
The most middle value of an arranged data is called Median. In other words median is that quantity which divides the data into two equal parts, i.e. 50%of the data lie below the median and 50% lie above the median. It is also known as a positional average. It is denoted by read as X- tilde.

Median from Ungrouped Data:

Median = Value of

item

Median from Ungrouped Data:

The median for grouped data, we find the cumulative frequencies and then calculated the median

number

. The median lies in the group (class) which corresponds to the cumulative frequency in which

lies. We use following formula to find the median.

Where = Lower class boundary of the model class = Frequency of the median class = Number of values or total frequency = Cumulative frequency of the class preceding the median class = Class interval size of the model class

MODE:
Mode is the value which occurs the greatest number of times in the data. When each value occur the same numbers of times in the data, there is no mode. If two or more values occur the same numbers of time, then there are two or more modes and distribution is said to be multi-mode. If the data having only one mode the distribution is said to be uni-model and data having two modes, the distribution is said to be bi-model.

Mode from Ungrouped Data:

Mode is calculated from ungrouped data by inspecting the given data. We pick out that value which occur the greatest numbers of times in the data. Example: Find the mode of the values 5, 7, 2, 9, 7, 10, 8, 5, 7 Solution: Mode is 7 because it occur the greatest number of times in the data.

Mode from Grouped Data:

When frequency distribution with equal class interval sizes, the class which has maximum frequency is called model class.

Or

Where = Lower class boundary of the model class = Frequency of the model class (maximum frequency) = Frequency preceding the model class frequency = Frequency following the model class frequency = Class interval size of the model class

Some Properties of Arithmetic Mean:

If x 1 and x2 are the means of the two groups computed from the values n1 and n2 then the mean x is given by the formula x = n1x1+n2x2/ n1+n2 If each observation in the data is replaced by x, the sum total of all the observations remains unchanged. x = x1,x2,x3,x4........,xn/n So x1,x2,x3,x4........,xn = nx Replacing each observation by x, we get x+x+x........+x = nx If every value of the variable x is either increased, decreased, divided or multiplied by a constant, the observations so obtained also increases, decreases, gets multiplied or gets divided respectively by the same constant. Algebraic sum of the deviation of a set of values from their

Quartiles, Percentiles & Deciles: Although quartiles, percentiles and deciles are not averages. They are included here because they are of same nature as of Median.

Quartile The values which divide data into four equal parts, where each part contains 25% observations are called Quartiles. These values are denoted by Q1, Q2 and Q3. Where, Q1 = First Quartile or Lower Quartile Q2 = Second Quartile = Median Q3 = Third Quartile or Upper Quartile

For Ungrouped Data Quartiles Percentiles Deciles

Q1=(n+1/4)th value Q2=2(n+1/4)th value P1=(n+1/100)th value P99=99(n+1/100)th value D1=1(n+1/10)th value D9=9(n+1/10)th value

For Grouped Data

Q1=l+h/f[1*f/4-c.f] Q2=l+h/f[2*f/4-c.f] P1=l+h/f[1*f/100-c.f] P99=l+h/f[99*f/100-c.f] D1=l+h/f[1*f/10-c.f] D9=l+h/f[9*f/10-c.f]

MEASURE OF DISPERSION:
A measure of dispersion is the degree of closeness of the values from its some central value i.e. means median or mode, etc. In other words, it may be concluded that measure of central tendency is a single number to represent a group of data whereas a measure of dispersion is used to measure differences in data. There are two types of measure of dispersion which are: (a) Absolute Measure of Dispersion (b) Relative Measure of Dispersion

Absolute Measures of Dispersion:

An absolute measure of dispersion is one that measure the dispersion in the term of the same units, as given in the original data. For example , if the units of data are rupees, kilograms, inches, etc. The absolute measures which are commonly used are: 1. 2. 3. 4. The Range The Quartile Deviation The Mean Deviation The Standard deviation and Variance

RANGE: It is defined as the differences between the largest and smallest values in a set of data. Range = Max. Value Min. Value QUARTILE DEVIATION (Semi-Interquartile Range): Quartile deviation defines as Q.D= Q3-Q1/2 MEAN DEVIATION: It is defined as the mean of the absolute values of the deviation taken from some average (Mean or Median) called Mean Deviation or simply Mean Deviation about Mean and Mean Deviation about Median. Mean Deviation about Mean / Median: Mean Deviation about mean or median is defined as

Grouped Data Mean Deviation about Mean Mean Deviation about Median M.D( )=xi M.D( )=xi /n /n

Ungrouped Data M.D( )=fxi M.D( )=fxi /f /f

VARIANCE AND STANDRAD DEVIATION: If are the n-values, then variance is defined as

Grouped Data Variance

( ) OR

Ungrouped Data
( ) OR

Standard Deviation

OR

OR

S.D=

Relative Measure of Dispersion: When the two distributions are in different units of measurement, it will be difficult to compare them. In such cases the relative measure of dispersion are used. Relative measures of dispersion are independent of units of measurements. They are generally expressed in the term of coefficients, ratios or percentages.

Types of Relative Measure Of Dispersion

1. Coefficient of Range: The Coefficient of Range is defined as: C. of Range = max. value min. value/max. value + min. value

2. Coefficient of Quartile Deviation: The Coefficient of Quartile Deviation is defined as, C. of Q.D = Q3 Q1/Q3 + Q1

3. Coefficient of Mean Deviation: The Coefficient of Mean Deviation is defined as, C. of MD = MD ( )/ & C. of MD ( )/ ( )

4. Coefficient of Variation: The coefficient of variation is an important and the most commonly used dispersion. C. of V. = Standard deviation/Mean *100 = S.D/( ) * 100

relative measure of