“Use of Central Tendency and Dispersion in Business Decision”
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“Use of Central Tendency and Dispersion in Business Decision”
Course Title: Business Statistics
Course Code: STS201
Submitted To: Mr. Raihanul Hasan Senior Lecturer
Submitted By: Date of submission: 26-12-12
BBA PROGRAM
STATE UNIVERSITY OF BANGLADESH
We can use single numbers called “Summary Statistics’ to describe characteristics of a data set. Two of these characteristics are particularly important to decision makers: 1. Central tendency 2. Dispersion
Measures of central tendency and dispersion provide a convenient way to describe and compare sets of data.
Central Tendency:
Central tendency is the middle point of a distribution. Measures of central tendency are also known as Measures of location. Measures of central tendency yield information about the center, or middle part, of a group of a numbers. It does not focus on the span of data set or how far values are from the middle numbers.
Dispersion:
Dispersion is the spread of the data in a distribution, that is, the extent to which the observations are scattered.
Objectives: * To use summary statistics to describe collection of data. * To use the mean, median and mode to describe how data “bunch up” * To use the range, variance and standard deviation to describe how data “spread out”.
MEASURES OF CENTRL TENDENCY
Measures of central tendency include three important tools – mean (average), median and mode.
Mean
The arithmetic mean is the most common measure of central tendency. For a data set, the mean is the sum of the observations divided by the number of observations. Basically, the mean describes the central location of the data.
For a given set of data, where the observations are x1, x2,….,xi ; the Arithmetic Mean is defined as :
The weighted arithmetic mean is used, if one wants to combine average values from samples of the same population with different sample sizes:
Example 1: Observations | 12 | 15 | 20 | 22 | 30 | Weights | 2
“Use of Central Tendency and Dispersion in Business Decision”
Course Title: Business Statistics
Course Code: STS201
Submitted To: Mr. Raihanul Hasan Senior Lecturer
Submitted By: Date of submission: 26-12-12
BBA PROGRAM
STATE UNIVERSITY OF BANGLADESH
We can use single numbers called “Summary Statistics’ to describe characteristics of a data set. Two of these characteristics are particularly important to decision makers: 1. Central tendency 2. Dispersion
Measures of central tendency and dispersion provide a convenient way to describe and compare sets of data.
Central Tendency:
Central tendency is the middle point of a distribution. Measures of central tendency are also known as Measures of location. Measures of central tendency yield information about the center, or middle part, of a group of a numbers. It does not focus on the span of data set or how far values are from the middle numbers.
Dispersion:
Dispersion is the spread of the data in a distribution, that is, the extent to which the observations are scattered.
Objectives: * To use summary statistics to describe collection of data. * To use the mean, median and mode to describe how data “bunch up” * To use the range, variance and standard deviation to describe how data “spread out”.
MEASURES OF CENTRL TENDENCY
Measures of central tendency include three important tools – mean (average), median and mode.
Mean
The arithmetic mean is the most common measure of central tendency. For a data set, the mean is the sum of the observations divided by the number of observations. Basically, the mean describes the central location of the data.
For a given set of data, where the observations are x1, x2,….,xi ; the Arithmetic Mean is defined as :
The weighted arithmetic mean is used, if one wants to combine average values from samples of the same population with different sample sizes:
Example 1: Observations | 12 | 15 | 20 | 22 | 30 | Weights | 2
References: 1) http://www.scribd.com/doc/24787874/Measures-of-Central-Tendency 2) http://www.headscratchingnotes.net/2011/12/measures-of-central-tendency-and-measures-of-dispersion/ 3) http://www.scribd.com/doc/74113636/Data-Analysis-Measures-of-Central-Tendency-Dispersion 4) http://www.ehow.com/info_8538178_jobs-use-central-tendency.html