Measures of Central Tendency

Mean Median Mode

Mean
Arithmetic Mean: It is the simple average of a group of data.

Arithmetic Mean Ungrouped (Raw) Data

x! Sum of Observations Number of Observations

xi

Arithmetic Mean Grouped Data

f x x! f
i

i i

Example
Class Interval Frequency ( fi ) 2 5 6 4 3 Mid Value of Class Interval ( xi ) 2500 3500 4500 5500 6500 fixi Col.(4) = Col.(2) x Col. 5000 17500 27000 22000 19500

2000 3000 3000 4000 4000 5000 5000 6000 6000 7000

Sum

7 fi = 20

7 fixi = 91000

Example
values of 7 fi and 7 fixi , in formula

f x x! f
i
= 91000 20 = 4550

i i

Median
The median divides the data into two parts such that the number of observations less than the median are equal to the number of observations more than it. It is therefore called positional measure.

Median - Ungrouped Data

First the data is arranged in ascending/descending order. Let he total observation be n. Median = observation at position (n+1)/2, if the n is odd. Otherwise it is average of the observations at position n/2, and n/2 +1

Example
Find out Median for the following data set. 2717, 2796, 3144, 3527, 3534,, 4187, 4310, 4506, 4784, 5034, 5071, 5424, 5561, 6505, 6874, 3098, 4923, 3862, 4745, 6707

Median - Grouped
The median for the grouped data is also defined as the value corresponding to the ( (n+1)/2 )th observation, and is calculated from the following formula: { (n/2) fc } Median = Lm + ----------------- v wm fm where, Lm is the lower limit of 'the median class fm is the frequency of the median class fc is the cumulative frequency up to the median class. wm is the width of the median class-interval n is the number of total observations.

Example
Class Interval Frequency Cumulative frequency 2 7 13 17 20

2000-3000 3000-4000 4000-5000 5000-6000 6000-70000

2 5 6 4 3

Example
Here, n = 20, the median class interval is from 4000 to 5000 as the 10th observation lies in this interval. Further, Lm = 4000 fm = 6 fc = 7 wm = 1000 Therefore, (20/2 7) x 1000 Median = 4000 + ------------------------6 = 4000 + 3/6 x 1000 = 4000 + 500 = 4500

Mode
It is the value which occur most frequently in a set of observation. It is therefore the value which has the highest frequency.

Mode
Mode = Lm +
where , Lm is the lower point of the modal class. ( fm is the frequency of the modal class. ( f0 is the frequency of the interval just before the modal class ( f2 is the frequency of the interval just after the modal class ( wm is the width of the modal class

fm - f0 ----------------- v wm 2fm - f0 - f2

Example 1
Marks 0-10 10-20 20-30 30-40 40-50 50-60 60-70 No. of Students 4 8 11 15 12 6 2

Example 2
Monthly Wages 800-1000 1000-1200 1200-1400 1400-1600 1600-1800 1800-2000 No. of Workers 18 25 30 34 26 10

Example 3
Size of Item 0-50 50-100 100-150 150-200 200-250 Frequency 15 20 36 40 10

Example 4
Size of Item
0-10 10-20 20-30 30-40 40-50 50-60 60-70 70-80 80-90 90-100

Frequency
1 3 6 10 12 11 6 3 2 1

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Simple Correlation Analysis

Contents
Introduction Scatter Diagram Simple Correlation Coefficient

Correlation
If two variables vary in such a way that movement in one is accompanied by the movement in other , the variables are said to be correlated.

Scatter Diagram
It is a way to plot the bi-variate data on a two dimensional graph so that pattern can be revealed.

Scatter Diagram
y Sales in Various Years x x Advertisement Expenses Incurred in Various Years x x x x x

Linear Correlation
Correlation is said to be linear if the plotted graph resembles more or less a straight line.

Scatter Diagram Showing Linear Correlation

y Sales x x x x x

Advertising Expenses

Non- Linear Correlation

Correlation is said to be Non-linear if the plotted graph doesn't resembles a straight line.

Non Linear Correlation

y x

Performance x

x x

x x

x x

Stress

No Correlation
If the plotted graph doesn't resembles any uniform figure it can be considered as if there is no correlation.

Scatter Diagram Showing No Correlation

x IQ x x x x

x x

x x x x Height

Positive Correlation
If both the variables either increase or decrease simultaneously, they are called positively correlated.

Scatter Diagram Showing Positive Correlation

y Sales x x x x x

Advertising Expenses

Negative Correlation
If the increase in one variable causes decrease in another variable and vice-versa, variables are said to be negatively correlated.

Scatter Diagram Showing Negative Correlation

y Demand x

x x x

Price

Pearsons correlation coefficient

r Covariance of x and y ! (Standard Deviation of x) (Standard Deviation of y)

Pearsons correlation coefficient

r! ( xi  x )( yi  y )

( x  x ) ( y  y )
x

Correlation Coefficient Interpretation

The value of correlation coefficient r lies between 1 and +1. The value +1 implies that there is a perfect positive correlation,. The value 1 implies that there is a perfect negative correlation. In real life situations, the correlation coefficient does not equals the value 1( +1 or 1). Its value nearing 1, indicates strong linear relationship, and its value nearing 0 indicates no correlation.

Question 1
X 6 Y 9

2
5 4 8

11
10 8 7

Question 2
Ad Expense
39 65 62 90 82 75 25 98 36 78

Sales
47 53 58 86 62 68 60 91 51 84

Question 3
Age of Husband
23 27 28 29 30 31 33 35 36 39

Age of wife
18 22 23 24 25 26 28 29 30 32

Question 4
Sales 50 50 55 60 65 65 65 60 60 50 Incentives 11 13 14 16 16 15 15 14 13 13

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Regression
Regression analysis refers to the estimation of the unknown value of a variable on the basis of a known value of another variable.

Regression
Correlation analysis deals with exploring the correlation that might exist between two or more variables The regression analysis, on the other hand, studies the relationship among two or more variables.

Dependent variable
It is the variable whose value is to be estimated.

Independent variable
It is the variable whose value is used to predict the value of dependent variable.

Linear Regression
If the regression curve, ones plotted on a graph turned out to be a (almost) straight line, the regression is called linear regression.

Simple Linear Regression

y x x x x

Non-Linear Regression
If the regression curve is not a straight line then the regression is called non-linear regression.

Two Regression Equations

The regression equation of y on x is given as,

y ! a  bx
Similarly, the equation

x ! c  dy
is called the regression equation of x on y.

Normal Equations
For Y on X, Y = XY = Na + bX aX + b X2

Question 1
X 6 2 5 4 8 Y 9 11 10 8 7

Question 2
Marks in Math's
80 62 36 95 12 50 89 25

Marks in Statistics
85 65 33 94 14 45 85 28

Question 3
Ad Expense
39 65 62 90 82 75 25 98 36 78

Sales
47 53 58 86 62 68 60 91 51 84

Question 4
Age of Husband
23 27 28 29 30 31 33 35 36 39

Age of wife
18 22 23 24 25 26 28 29 30 32

Question 5
Sales
50 50 55 60 65 65 65 60 60 50

Incentives
11 13 14 16 16 15 15 14 13 13

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Skewness
It literally means Lack of Symmetry. Thus it helps us to study the shape of curves. Perfectly skewed curve means zero skewness. It is represented by, Sk

Positive Skewed Curve

Here the variation is more towards higher value of variables. For positively skewed curve, Mean has maximum value and Mode has minimum.

Positive Skewed Curve

Here the variation is more towards lower value of variables. For Negatively skewed curve, Mode has maximum value and Mean has minimum.

Measures of Skewness
Karl Pearsons coefficient of Skewness:

Sk =

(Mean Mode ) Standard Deviation