Spring / February 2012

Master of Business Administration MBA Semester 1 MB0040 Statistics for Management 4 Credits
(Book ID: B1129) Assignment Set 2 (60 Marks)

Q1). Explain the following terms with respect to Statistics: (i) Sample, (ii) Variable, (iii) Population. Answer: Universe or Population Statistical survey or enquiries deal with studying various characteristics of unit belonging to a group. The group consisting of all the units is called Universe or Population. The figure 7.1 illustrates the population.

Sample Sample is a finite subset of a population. A sample is drawn from a population to estimate the characteristics of the population. Sampling is a tool which enables us to draw conclusions about the characteristics of the population. The figure 7.3 illustrates the population and sample.

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Q2). What are the types of classification of data? Answer: Types of classification of Data The important types of classification are: Geographical classification Data classified according to region is geographical classification. Chronological classification Data classified according to the time of its occurrence is called chronological classification. Conditional classification Classification of data done according to certain conditions is called conditional classification. Qualitative classification Classification of data that is immeasurable is called qualitative classification. For example, sex of a person, marital status, color and others. Quantitative classification Classification of data that is measurable either in discrete or continuous form is called quantitative classification. Statistical Series Data is arranged logically according to size or time of occurrence or some other measurable or non-measurable characteristics. ROLL No. - 511223187 2

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Q3). Find the (i) arithmetic mean and (ii) range if the following data: 15, 17, 22, 21, 19, 26, 20.

Solution: The arithmetic mean

is given by:

Therefore, the arithmetic mean is 20. Q4). Suppose two houses in a thousand catch fire in a year and there are 2000 houses in a village. What is the probability that: i]. None of the houses catches fire ii]. At least one house catches fire Solution: Given the probability of a house catching fire is: and Therefore, the required probabilities are calculated as follows: i. The probability that none catches fire is given by:

Therefore, the probability that none of the houses catches fire is 0.01832. ii. The probability that at least one catches fire is given by:

Therefore, the probability that at least one house catches fire is 0.98168. Q5). (i) What are the characteristics of Chi-square test? Answer: Characteristics of Chi-Square test The following are the characteristics of Chi-Square test (c2 test). The c2 test is based on frequencies and not on parameters

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Spring / February 2012 It is a non-parametric test where no parameters regarding the rigidity of population of populations are required Additive property is also found in c2 test The c2 test is useful to test the hypothesis about the independence of attributes The c2 test can be used in complex contingency tables The c2 test is very widely used for research purposes in behavioral and social sciences including business research It is defined as:

Where, O is the observed frequency and E is the expected frequency. Q5. (ii) The table below gives the production in three shifts and the number of defective goods that turned out in three weeks. Test at 5% level of significance whether weeks and shifts are independent. Shif 1 2 3 Tot t Week Week Week al I 15 5 20 40 II 20 10 20 50 III 25 15 20 60 Tot 60 30 60 150 al Solution: The table below displays the observed and expected values required to calculate c2. Observed Value Expected Value (O) (E) 15 40 x 60 /150 = 16 20 50 x 60/150 = 20 25 60 x 60/150 = 24 5 40 x 30/150 = 8 10 50 x 30/150 = 10 15 60 x 30/150 = 12 20 40 x 60/150 = 16 20 50 x 60 /150 = 20 ROLL No. - 511223187 4 (O E)2 1 0 1 9 0 9 16 0

0.0625 0 0.0417 1.125 0 0.75 1 0

Spring / February 2012 20 60 x 60/150 = 24 16 c2 0.6667 3.6459

The steps followed to calculate c2 are described below. 1. Null hypothesis Ho: The week and shifts are independent Alternate hypothesis HA: The week and shifts are dependent 2. Level of Significance is 5% and D.O.F (3 1) (3 1) = 4

3. Test Statistics

4. Test c2cal = 3.6459 5. Conclusion: Since c2cal (3.6459) < c2tab (9.49), Ho is accepted. Hence, the attributes week and shifts are independent. Q6). Find Karl Pearsons correlation co-efficient for the data given in the below table: X Y 2 0 2 2 1 1 84 6 2 1 4 18 4 2 X2 400 256 144 64 16 X2 = 880 Y2 484 196 16 144 64 Y2 = 904 XY 440 224 48 96 32 XY = 840

Solution: X Y 20 16 12 8 4 X = 60 22 14 4 12 8 Y = 60

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Hence, Karl Pearsons correlation coefficient is 0.70.

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