Intro to Statistics
Statistics in Business
Heather Vinson
QNT/351
May 14, 2013
Babak Memarian
Statistics in Business
Statistics is the branch of mathematics used to collect, analyze, interpret, and present data. It is used by business owners to make calculated decisions regarding the future of their companies.
Types of Statistics There are two types of statistics. Descriptive statistics deal with describing a set of data elements graphically. This type of statistic does not make any sort of prediction, but rather shows bullet point type data. An example of descriptive statistics would be a plot line graph that reflects the United States population by year for the last ten years. A person looking at this data would easily be able to determine how the population has increased or decreased in the past decade. The data would be insufficient however to determine what the population will be ten years from now. The second type of statistics is Inferential statistics. Inferential statistics uses a sampling of information to infer a future outcome. This is often referred to as the ‘best guess’ method of statistics. This type of information is what is used by businesses in particular to make educated decisions for future planning.
Levels of Statistics There are also many levels of statistics. Nominal level statistics portray objects by name or by a label. Ordinal level statistics has ordered data such as by number or by letter. Interval level statistics has data ordered by the differences or intervals between the data. An example would be a thermometer labeled in degrees Celsius. These are all useful ways to organize data, but the more reliable and widely used level is Ratio level statistics. In ratio statistics there is a natural zero starting point. This one fact gives the intervals between data actual meaning. A person can actually compare measurements using the ratio method. Business Decisions. All business
Heather Vinson
QNT/351
May 14, 2013
Babak Memarian
Statistics in Business
Statistics is the branch of mathematics used to collect, analyze, interpret, and present data. It is used by business owners to make calculated decisions regarding the future of their companies.
Types of Statistics There are two types of statistics. Descriptive statistics deal with describing a set of data elements graphically. This type of statistic does not make any sort of prediction, but rather shows bullet point type data. An example of descriptive statistics would be a plot line graph that reflects the United States population by year for the last ten years. A person looking at this data would easily be able to determine how the population has increased or decreased in the past decade. The data would be insufficient however to determine what the population will be ten years from now. The second type of statistics is Inferential statistics. Inferential statistics uses a sampling of information to infer a future outcome. This is often referred to as the ‘best guess’ method of statistics. This type of information is what is used by businesses in particular to make educated decisions for future planning.
Levels of Statistics There are also many levels of statistics. Nominal level statistics portray objects by name or by a label. Ordinal level statistics has ordered data such as by number or by letter. Interval level statistics has data ordered by the differences or intervals between the data. An example would be a thermometer labeled in degrees Celsius. These are all useful ways to organize data, but the more reliable and widely used level is Ratio level statistics. In ratio statistics there is a natural zero starting point. This one fact gives the intervals between data actual meaning. A person can actually compare measurements using the ratio method. Business Decisions. All business
References: Lind, D.A., Marchal, W. G., & Wathen, S.A. (2011). Basic statistics for business and economics (7th ed.). New York, NY: McGraw-Hill/Irwin.