INTRODUCTION TO STATISTICS AND BUSINESS

Copyright © 2023 John Wiley & Sons Canada, Ltd. Unauthorized copying, distribution, or transmission of this page is prohibited

CHAPTER 1

INTRODUCTION TO STATISTICS AND BUSINESS

ANALYTICS

CHAPTER LEARNING OBJECTIVES

• Define important statistical terms, including population, sample, and parameter, as

they relate to descriptive and inferential statistics. The study of statistics can be subdivided into two main areas: descriptive statistics and inferential statistics. Descriptive statistics result from gathering data from a body, group, or population and reaching conclusions only about that group. Inferential statistics are generated from the process of gathering sample data from a group, body, or population and reaching conclusions about the larger group from which the sample was drawn.

• Explain the difference between variables, measurement, and data, and compare the

four different levels of data: nominal, ordinal, interval, and ratio. Most business statistics studies contain variables, measurements, and data. A variable is a characteristic of any entity being studied that is capable of taking on different values. Examples of variables might include monthly household food spending, time between arrivals at a restaurant, and patient satisfaction rating. A measurement is when a standard process is used to assign numbers to particular attributes or characteristics of a variable. Measurements of monthly household food spending might be taken in dollars, time between arrivals might be measured in minutes, and patient satisfaction might be measured using a 5-point scale. Data are recorded measurements. It is data that are analyzed by business statisticians in order to learn more about the variables being studied. Two major types of inferential statistics are (1) parametric statistics and (2) nonparametric statistics. Use of parametric statistics requires interval or ratio data and certain assumptions about the distribution of the data. The techniques presented in this text are largely parametric. If data are only nominal or ordinal in level, nonparametric statistics must be used.The appropriate type of statistical analysis depends on the level of data measurement, which can be (1) nominal, (2) ordinal, (3) interval, or (4) ratio. Nominal is the lowest level, representing the classification of only data such as geographic location, sex, or social insurance number. The next level is ordinal, which provides rank ordering measurements in which the intervals between consecutive numbers do not necessarily represent equal distances. Interval is the next to highest level of data measurement, in which the distances represented by consecutive numbers are equal. The highest level of data measurement is ratio, which has all the qualities of interval measurement, but ratio data contain an absolute zero and ratios between numbers are meaningful. Interval and ratio data are sometimes called metric or quantitative data. Nominal and ordinal data are sometimes called nonmetric or qualitative data.

• Explain the differences between the four dimensions of big data. The data that is

available to decision makers is exponentially growing, as are the sources for that data. This growth has resulted in a new set of data called ‘big data’. Big data is defined as a collection of large and complex datasets from different sources that are difficult to process using traditional data management and processing applications. There are four key characteristics associated (Business Statistics for Contemporary Decision Making, 4th Canadian Edition, 4e Ken Black, Tiffany Bayley, Ignacio Castillo) (Test Bank Latest Edition 2023-24, Grade A+, 100% Verified) 1 / 4

Introduction to Statistics 1 - 2

Copyright © 2023 John Wiley & Sons Canada, Ltd. Unauthorized copying, distribution, or transmission of this page is prohibited with big data and they are: variety, velocity, veracity and volume. Each of these characteristics are discussed in the text.The computer allows for the storage, retrieval, and transfer of large data sets. Furthermore, computer soft ware has been developed to analyze data by means of sophisticated statistical techniques. Business statisticians use many popular statistical soft ware packages, including Minitab, SAS, and SPSS. In this text, the computer statistical output presented is from the Microsoft Excel software, which in spite of its limitations, is the most commonly used package in the business environment.

• Compare and contrast the three categories of business analytics. There are three main

categories of business analytics, or the application of processes and techniques that transform raw data into meaningful information to improve decision making. The three categories are descriptive analytics, predictive analytics and prescriptive analytics. Descriptive analytics describe what has or is happening relative to the data collected. On the other hand, predictive analytics which look to find relationships in the data. Tools in this category include regression analysis, time-series and forecasting; all of which are designed to allow management to estimate what might happen based on a given set of criteria or circumstance. The last category is prescriptive analytics which take risk into account when analyzing data and making decisions based on that data. Examples of where prescriptive analytics may be used include performance management or network analysis.

• Describe the data mining and data visualization processes. Data mining is the process

of collecting, exploring and analyzing large volumes of data in an effort to uncover hidden patterns and/or relationships that can be used to enhance business decision-making. Data mining allows businesses to take large amounts of data, pull out what they need to facilitate decision making. Data visualization is the study of visual representation of data and is employed to convey data or information by imparting it as visual objects displayed in graphics.By presenting the information or data visually can make the data and data results more understandable and thereby more useable.

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• - 3 Test Bank for Business Statistics, Fourth Canadian Edition

Copyright © 2023 John Wiley & Sons Canada, Ltd. Unauthorized copying, distribution, or transmission of this page is prohibited

TRUE-FALSE STATEMENTS

• Statistics is a science that only deals with the analysis of numerical data.

Answer: True

Difficulty: Easy

Learning Objective: Define important statistical terms, including population, sample, and parameter, as they relate to descriptive and inferential statistics.

Section Reference: 1.1 Basic Statistical Concepts

Blooms: Knowledge

AACSB: Analytic

• The complete collection of all entities under study is called the sample.

Answer: False

Difficulty: Easy

Learning Objective: Define important statistical terms, including population, sample, and parameter, as they relate to descriptive and inferential statistics.

Section Reference: 1.1 Basic Statistical Concepts

Blooms: Knowledge

AACSB: Analytic

• A portion or subset of the entities under study is called the statistic.

Answer: False

Difficulty: Easy

Learning Objective: Define important statistical terms, including population, sample, and parameter, as they relate to descriptive and inferential statistics.

Section Reference: 1.1 Basic Statistical Concepts

Blooms: Knowledge

AACSB: Analytic

• A descriptive measure of the population is called a parameter.

Answer: True

Difficulty: Easy

Learning Objective: Define important statistical terms, including population, sample, and parameter, as they relate to descriptive and inferential statistics.

Section Reference: 1.1 Basic Statistical Concepts

Blooms: Knowledge

AACSB: Analytic

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Introduction to Statistics 1 - 4

Copyright © 2023 John Wiley & Sons Canada, Ltd. Unauthorized copying, distribution, or transmission of this page is prohibited

• A census is the process of gathering data on all the entities in the population.

Answer: True

Difficulty: Easy

Learning Objective: Define important statistical terms, including population, sample, and parameter, as they relate to descriptive and inferential statistics.

Section Reference: 1.1 Basic Statistical Concepts

Blooms: Knowledge

AACSB: Analytic

• Statistics is commonly divided into two branches called descriptive statistics and summary

statistics.

Answer: False

Difficulty: Easy

Learning Objective: Define important statistical terms, including population, sample, and parameter, as they relate to descriptive and inferential statistics.

Section Reference: 1.1 Basic Statistical Concepts

Blooms: Knowledge

AACSB: Analytic

• Statistics is commonly divided into two branches called descriptive statistics and inferential

statistics.

Answer: True

Difficulty: Easy

Learning Objective: Define important statistical terms, including population, sample, and parameter, as they relate to descriptive and inferential statistics.

Section Reference: 1.1 Basic Statistical Concepts

Blooms: Knowledge

AACSB: Analytic

• A descriptive measure of the sample is called a statistic.

Answer: True

Difficulty: Easy

Learning Objective: Define important statistical terms, including population, sample, and parameter, as they relate to descriptive and inferential statistics.

Section Reference: 1.1 Basic Statistical Concepts

Blooms: Knowledge

AACSB: Analytic

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