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MB0040-STATISTICS FOR MANAGEMENT Q1. What are the functions of Statistics? Disti nguish between Primary data and Secondary data. Statistics as a discipline is co nsidered indispensable in almost all spheres of human knowledge. There is hardly any branch of study which does not use statistics. Scientific, social and econo mic studies use statistics in one form or another. These disciplines makeuse of observations, facts and figures, enquiries and experiments etc. using statistics and statistical
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  MB0040-STATISTICS FOR MANAGEMENT Q1. What are the functions of Statistics? Distinguish between Primary data and Secondary data. Statistics as a discipline is considered indispensable in almost all spheres of human knowledge. There is hardlyany branch of study which does not use statistics. Scientific, social and economic studies use statistics in one form or another. These disciplines makeuse ofobservations, facts and figures, enquiries and experiments etc. using statisticsand statistical methods. Statistics studies almost all aspects in an enquiry. It mainly aims at simplifying the complexity of information collected in an enquiry. It presents data in a simplified form as to make them intelligible. It analyses data and facilitates drawal of conclusions. Now let us briefly discuss someof the important functions of statistics.  Presents facts in. simple form: Statistics presents facts and figures in a definite form. That makes the statement logical and convincing than mere description. It condenses the whole mass of figures into a single figure. This makes the problem intelligible.  Reduces the Complexity of data: Statistics simplifies the complexity of data. The raw data are unintelligible. We make them simple and intelligible by using different statisticalmeasures. Some such commonly used measures are graphs, averages, dispersions, skewness, kurtosis, correlation and regression etc. These measures help in interpretation and drawing inferences. Therefore, statistics enables to enlarge the horizon of one's knowledge.  Facilitates comparison: Comparison between different sets of observation is an important function of statistics. Comparison is necessary to draw conclusions as Professor Boddington rightly points out.” the object of statistics is to enable comparison between past and present results to ascertainthe reasons for changes, which have taken place and the effect of such changes in future. So to determine the efficiency of any measure comparison is necessary.Statistical devices like averages, ratios, coefficients etc. are used for the purpose of comparison.  Testing hypothesis: Formulating and testing of hypothesisis an important function of statistics. This helps in developing new theories. So statistics examines the truth and helps in innovating new ideas.  Formulation of Policies : Statistics helps in formulating plans and policies in different fields. Statistical analysis of data forms the beginning of policy formulations. Hence, statistics is essential for planners, economists, scientists and administrators to prepare different plans and programmes.  Forecasting : The future is uncertain. Statistics helps in forecasting the trend and tendencies. Statistical techniques are used for predicting the future values of a variable. For example a producer forecasts his future production on the basis of the present demand conditions and his past experiences. Similarly, the planners can forecast the futurepopulation etc. considering the present population trends.  Derives valid inferences : Statistical methods mainly aim at deriving inferences from an enquiry. Statistical techniques are often used by scholars ’ planners and scientists to evaluate different projects. These MB0040 Page 1  MB0040-STATISTICS FOR MANAGEMENT techniques are also used to draw inferences regarding population parameters on the basis of sample information. Statistics is very helpful in the field of business, research, Education etc., some of the usesof Statistics are:  Statistics helps in providing a better understanding and exact description of a phenomenon of nature.  Statistics helps in proper and efficient planning of a statistical inquiry in any field of study.  Statistical helps incollecting an appropriate quantitative data.  Statistics helps in presenting complex data in a suitable tabular, diagrammatic and graphic form for any easy andcomprehension of the data.  Statistics helps in understanding the nature and pattern of variability of a phenomenon through quantitative observations.  Statisticshelps in drawing valid inference, along with a measure of their reliability about the population parameters from the sample data Any statistical data can be classified under two categories depending upon the sources utilized. These categories are, 1. Primary data 2. Secondary data Primary Data: Primary data is the one, which is collected by the investigator himself for the purpose of a specific inquiry or study. Such data is srcinal in character and is generated by survey conducted by individuals or research institution or any organisation. 1. The collection of data by the method of personal survey is possible only if the area covered by the investigator is small. Collection of data by sending the enumeratoris bound to be expensive. Care should be taken twice that the enumerator recordcorrect information provided by the informants. 2. Collection of primary data byframing a schedules or distributing and collecting questionnaires by post is less expensive and can be completed in shorter time. 3. Suppose the questions areembarrassing or of complicated nature or the questions probe into personnel affairs of individuals, then the schedules may not be filled with accurate and correct information and hence this method is unsuitable 4. The information collectedfor primary data is mere reliable than those collected from the secondary data.Importance of Primary data cannot be neglected. A research can be conducted without secondary data but a research based on only secondary data is least reliableand may have biases because secondary data has already been manipulated by human beings. In statistical surveys it is necessary to get information from primarysources and work on primary data: for example, the statistical records of female population in a country cannot be based on newspaper, magazine MB0040 Page 2  MB0040-STATISTICS FOR MANAGEMENT and other printed sources. One such sources areold and secondly they contain limited information as well as they can be misleading and biased. Secondary Data: Secondary data are those data which have been already collected and analysed by some earlier agency for its own use; and laterthe same data are used by a different agency. According to W.A.Neiswanger, ‘ A primary source is a publication in which the data are published by the same authority which gathered and analysed them. A secondary source is a publication, reporting the data which have been gathered by other authorities and for which othersare responsible ’. 1. Secondary data is cheap to obtain. Many government publications are relatively cheap and libraries stock quantities of secondary data produced by the government, by companies and other organizations. 2. Large quantities of secondary data can be got through internet. 3. Much of the secondary data available has been collected for many years and therefore it can be used to plot trends. 4. Secondary data is of value to: - The government – help in making decisionsand planning future policy. Business and industry – in areas such as marketing, and sales in order to appreciate the general economic and social conditions and to provide information on competitors. Research organizations – by providing social, economical and industrial information. Secondary data can be less valid but its importance is still there. Sometimes it is difficult to obtain primary data; in these cases getting information from secondary sources is easier and possible.Sometimes primary data does not exist in such situation one has to confine theresearch on secondary data. Sometimes primary data is present but the respondents are not willing to reveal it in such case too secondary data can suffice: forexample, if the research is on the psychology of transsexuals first it is difficult to find out transsexuals and second they may not be willing to give information you want for your research, so you can collect data from books or other published sources.MB0040Page 3  MB0040-STATISTICS FOR MANAGEMENT Q2. Draw a histogram for the following distribution:Age 0-10 10-20 20-30 30-40 40-50No. of people510158216 14 12 10 8 6 4 2 0 Frequency0-10 10-20 20-30 30-40 40-50Q3. Find the median value of the following set of values: 45, 32, 31, 46, 40, 28, 27, 37, 36, 41 Arranging in ascending order 27, 28, 31, 32, 36, 37, 40, 41, 45, 46 Median= 36+37/2 = 36.5 MB0040 Page 4
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