19.01.2015 Views

Statistics for Decision- Making in Business - Maricopa Community ...

Statistics for Decision- Making in Business - Maricopa Community ...

Statistics for Decision- Making in Business - Maricopa Community ...

SHOW MORE
SHOW LESS

You also want an ePaper? Increase the reach of your titles

YUMPU automatically turns print PDFs into web optimized ePapers that Google loves.

2.3 Descriptive <strong>Statistics</strong> – Center and Position<br />

Histograms provide us with a great visualization of the overall distribution of values. A<br />

distribution describes the layout of the values of a quantitative or categorical variable. To further<br />

describe the differences between two similar distributions, it is helpful to use statistics that<br />

describe center, location, and spread.<br />

2.3.1 Mean and Median<br />

To make peace with some regularly occurr<strong>in</strong>g notation <strong>in</strong> statistics, we will use<br />

mean “the sum of.” For <strong>in</strong>stance,<br />

(“sigma”) to<br />

Let‟s say that we have a set of variable values. To dist<strong>in</strong>guish each of these “ ‟s” we‟ll use<br />

subscripts, denot<strong>in</strong>g them:<br />

Then, to <strong>in</strong>dicate that we want to sum these values across all subscripts, we would write:<br />

Which means, “sum up all<br />

values <strong>in</strong> the dataset,” or<br />

Us<strong>in</strong>g this new notation, we already know how to calculate the mean:<br />

Mean – x-bar notation<br />

The mean value, or average, of a dataset conta<strong>in</strong><strong>in</strong>g<br />

values can be written as:<br />

̅, is used to denote the mean of a sample and can be read as “x-bar.”<br />

A common po<strong>in</strong>t of confusion <strong>for</strong> students is the difference <strong>in</strong> the subscript and the<br />

denom<strong>in</strong>ator . Many people th<strong>in</strong>k that the subscript should be to match the number of<br />

elements <strong>in</strong> the dataset. However, specifically refers to the very last value <strong>in</strong> the dataset. We<br />

treat the as an <strong>in</strong>dex that goes across all subscripts from 1 all the way up to and <strong>in</strong>clud<strong>in</strong>g . To<br />

<strong>Statistics</strong> <strong>for</strong> <strong>Decision</strong>-<strong>Mak<strong>in</strong>g</strong> <strong>in</strong> Bus<strong>in</strong>ess © Milos Podmanik Page 56

Hooray! Your file is uploaded and ready to be published.

Saved successfully!

Ooh no, something went wrong!