Chapter 1 Data and Statistics Learning Objectives 1. Obtain an appreciation for the breadth of statistical applications in business and economics. 2. Understand the meaning of the terms elements, variables, and observations as they are used in statist ics. 3. Obtain an understanding of the difference between categorical, quantitative, cross -sectional , and time series data. 4. Learn about the sources of data for statistical analysis both internal and external to the firm. 5. Be aware of how errors can arise in data. 6. Know the meaning of descriptive statistics and statistical inference. 7. Be able to distinguish between a population and a sample. 8. Understand the role a sample plays in making statistical inferences about the population. 9. Know t he meaning of the term s analytics, big data and data mining. 10. Be aware of ethical guidelines for statistical practice. 4 - 2 Solutions: 1. Statistics can be referred to as numerical facts. In a broader sense, statistics is the field of study dealing with the collection, analysis, presentation , and interpretation of data. 2. a. The ten elements are the ten tablet computers . b. Five variables: Cost ($), Operating System, Display Size (inches), Battery Life (hours), CPU Manufacturer c. Categorical variables: Operating System and CPU Manufacturer Quantitative variables: Cost ($), Display Size (inches), and Battery Life (hours) d. Variable Measurement Scale Cost ($) Ratio Operating System Nominal Display Size (inches) Ratio Battery Life (hours) Ratio CPU Manufacturer Nominal 3. a. Average cost = 5829/10 = $582.90 b. Average cost with a Windows operating system = 3616/5 = $723.20 Average cost with an Android operating system = 1714/4 = $428.5 The average cost with a Windows operating system is much higher. c. 2 of 10 or 20% use a CPU manufactured by TI OMAP . d. 4 of 10 or 40% use an Android operating system . 4. a. There are eight elements in this data set; each element corresponds to one of the eight models of cordless telephones . b. Categorical variables: Voice Quality and Handset on Base Quantitative variables: Price, Overall Score, and Talk Time c. Price – ratio measurement Overall Score – interval measurement Voice Quality – ordinal measurement Handset on Base – nominal measurement Talk Time – ratio measurement 5. a. Average Price = 545/8 = $68.13 b. Average Talk Time = 71/8 = 8.875 hours c. Percentage rated Excellent: 2 of 8 2/8 = .25, or 25% 4 - 3 © 20 21 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. 6. a. Categorical b. Quantitati ve c. Categorical d. Quantitative e. Quantitative 7. a. Since there are five choices, the response is a categorical response. b. The five responses are the labels for the customer responses. A nominal scale is being used. 8. a. 762 b. Categorical c. Percentages d. .67(762) = 510.54 510 or 511 respondents said they want the amendment to pass. 9. a. The population is employed individuals in the United States aged 25–29. b. Have you earned a bachelor’s degree (or higher) ? c. Since the response is yes or no, the response is categorical. 10. a. Categorical b. Percentages c. 44 of 1080 respondents or approximately 4% strongly agree with allowing drivers of motor vehicles to talk on a hand -held cell phone while driving. d. 165 of the 1080 respondents or 15% of said they somewhat disagree and 741 or 69% said they strongly disagree. Thus, there does not appear to be general support for allowing drivers of motor vehicles to talk on a hand -held cell phone while driving. 11. a. Since the respondents answer with some time interval , the response is catego rical. b. .53(1503) = 796.59 or approximately 797 c. .10(1503) = 150.3 or approximately 150 12. a. The population is all visitors coming to the state of Hawaii. b. Since airlin e flights carry the vast majority of visitors to the state , the use of questionnaires for passengers during incoming flights is a good way to reach this population. The questionnaire actually appears on the back of a mandatory plants and animals declaratio n form that passengers must complete during the incoming flight. A large percentage of passengers complete the visitor information questionnaire. 4 - 4 c. Questions 1 and 4 provide quantitative data indicating the number of visits and the number of days in Haw aii. Questions 2 and 3 provide categorical data indicating the categories of reason for the trip and where the visitor plans to stay. 13. a. Facebook worldwide advertising revenue. b. Quantitative c. Time series d. Facebook advertising revenue is i ncreasing at an increasing rate over time. 14. a. The graph of the time series follows: b. In Year 1 and Year 2 Hertz was the clear market share leader. In Year 3 and Year 4 Hertz and Avis have approximately the same market share. The market share fo r Dollar appears to be declining. c. The bar chart for Year 4 is shown below. 050100150200250300350
Yea r 1 Yea r 2 Yea r 3 Yea r 4 Cars in Service (1000s) Hertz Dollar Avis
Yea r 1 Yea r 2 Yea r 3 Yea r 4 Cars in Service (1000s) Hertz Dollar Avis
