2. 1-1

3. 1-2 Chapter One An Introduction to Business Statistics McGraw-Hill/Irwin Copyright © 2004 by The McGraw-Hill Companies, Inc. All rights reserved.

4. 1-3 An Introduction to Business Statistics 1.1 Populations and Samples 1.2 Sampling a Population of Existing Units 1.3 Sampling a Process 1.4 Ratio, Interval, Ordinal, and Nominative Scales of Measurement

5. 1-4 Populations and Samples Population A set of existing units (people, objects, or events) Variable A measurable characteristic of the population Quantitative (real-valued)/ Qualitative (categorical) Census An examination of the entire population of measurements Sample A selected subset of the units of a population

6. 1-5 Populations and Samples Population Sample

7. 1-6 Descriptive Statistics and Statistical Inference Descriptive Statistics The science of describing important aspects of a set of measurements Statistical Inference The science of using a sample of measurements to make generalizations about important aspects of a population

8. 1-7 Sampling a Population of Existing Units Random Sampling A procedure for selecting a subset of the population units in such a way that every unit in the population has an equal chance of selection Sampling with replacement When a unit is selected as part of the sample, its value is recorded and placed back into the population for possible reselection Sampling without replacement Units are not placed back into the population after selection

9. 1-8 Approximate Random Samples Frame A list of all population units. Required for random sampling, but not for approximate random sampling methods like systematic and voluntary response sampling. Systematic Sample Every k-th element of the population is selected for the sample Voluntary Response Sample Sample units are self-selected (as in radio/TV surveys)

10. 1-9 Process A sequence of operations that takes inputs (labor, raw materials, methods, machines, and so on) and turns them into outputs (products, services, and the like.) Process Inputs Outputs Sampling a Process A process is in statistical control if it displays constant level and constant variation.

11. 1-10 Runs Plot A runs plot is a graph of individual process measurements over time.

12. 1-11 Runs Plot – Payment Time Example

13. 1-12 Scales of Measurement Ratio Quantitative scale, ratios are meaningful, inherently defined zero. (e.g. salary, height, distance.) Interval Quantitative scale, but ratios not meaningful nor is there an inherently defined zero. (e.g. temperature) Ordinal Qualitative or categorical scale with meaningful ordering or ranking of categories. (e.g. income classification) Nominative Qualitative scale without meaningful ordering among categories (e.g. gender, ethnic classification)

14. 1-13 An Introduction to Business Statistics 1.1 Populations and Samples 1.2 Sampling a Population of Existing Units 1.3 Sampling a Process 1.4 Ratio, Interval, Ordinal, and Nominative Scales of Measurement Summary: