1 M02-Data Collection/Types  Department of ISM, University of Alabama, Lesson Objectives - M02  Understand “Scales of Measurement.”  Understand “Quantitative Variables” and the two types.  Understand “Categorical Variables” and the three types.  Determine which of the above to use to make a decision.

2 M02-Data Collection/Types  Department of ISM, University of Alabama, STATISTICS is the science of collecting, organizing, summarizing, and interpreting…  collecting,  organizing,  summarizing, and  interpreting… DATA for the purpose of _______________.

3 M02-Data Collection/Types  Department of ISM, University of Alabama, Problem Situation Your first job as a newly named marketing associate for Taco Casa: Manage a task force to determine the location of a new store from among four candidate cities. What do you do?

4 M02-Data Collection/Types  Department of ISM, University of Alabama, Must make a decision! Where do you start?

5 M02-Data Collection/Types  Department of ISM, University of Alabama, Back to Taco Casa Problem: Your task force is charged with comparing characteristics of households in the four different cities (market profiles).

6 M02-Data Collection/Types  Department of ISM, University of Alabama, Variables that may be useful for site selection.

7 M02-Data Collection/Types  Department of ISM, University of Alabama, Variables that may be useful for site selection.

8 M02-Data Collection/Types  Department of ISM, University of Alabama, Variables that may be useful for site selection.

9 M02-Data Collection/Types  Department of ISM, University of Alabama, What to measure? How to measure? Best data gathering approach? Designing a data collection is not simple!

10 M02-Data Collection/Types  Department of ISM, University of Alabama, Drawing conclusions about the population (___________), based on a sample (___________). Statistical Inference

11 M02-Data Collection/Types  Department of ISM, University of Alabama, Definition: Variable Any measurable characteristic of a person or thing. In a data set, always observe the: i) number of variables ii) types of variables.

12 M02-Data Collection/Types  Department of ISM, University of Alabama,   Rule of Thumb: If averages or differences have meaning, a variable is ________________. Ex:

13 M02-Data Collection/Types  Department of ISM, University of Alabama, Types of Quantitative Variables Discrete: _____________ values with gaps between them. Note: Not necessarily integers. May be an infinite number of values. Continuous: ___________ in an interval can occur.

14 M02-Data Collection/Types  Department of ISM, University of Alabama, Scales of Measurement Nominal Ordinal Interval Ratio Each value is a __________ ________ has meaning Units of measurement True absolute zero

15 M02-Data Collection/Types  Department of ISM, University of Alabama,   Rule of Thumb: A variable that classifies people or things, is _________ or ______________. Ex: sex, political affiliation, race, country of origin.

16 M02-Data Collection/Types  Department of ISM, University of Alabama, Types of Qualitative Variables Nominal: Numbers are used to “NAME” categories. ____________: The categories have a natural ordering. Binary: Two categories (usually assigned values of “0” or “1”).

17 M02-Data Collection/Types  Department of ISM, University of Alabama, Identify the type: Height: Stock Quote: Age: Course Grade: Football jersey number:

18 M02-Data Collection/Types  Department of ISM, University of Alabama, Identify the type: Answer to a T/F Question: Number of correct T/F answers in 5 questions: Proportion of correct T/F answers in 5 questions:

19 M02-Data Collection/Types  Department of ISM, University of Alabama, Handout: Data for 100 Households (FAM100.DAT) Income1Annual income of principal wage earner Income2Annual income of secondary wage earner FamSizeFamily size Own?Own or rent (1 = own, 0 = rent) TotalDebtTotal indebtedness (excluding mortgage) HousingMonthly house payment or rent UtilityAverage monthly utility expenditure CityCity of residence (1, 2, 3, 4)

20 M02-Data Collection/Types  Department of ISM, University of Alabama, After we collect data, then what? Organize / Summarize Data GraphicalNumerical

21 M02-Data Collection/Types  Department of ISM, University of Alabama,

22 M02-Data Collection/Types  Department of ISM, University of Alabama, Descriptive Statistics: numerical summaries and/or graphical display of (sample) data. Inferential Statistics: Using sample data to make conclusions about the population from which the sample was taken.

23 M02-Data Collection/Types  Department of ISM, University of Alabama, Population: collection of all items of interest in a study Sample: subset selected to be representative of the population