STATISTICAL METHODOLOGY

Statistical
Methodology
Data
Collection
Organization
&
Presentation
Descriptive
Measures
Statistical
Inference
Predictive
Statistics
Descriptive Statistics
It is the first major component of statistical
methodology. It is also the efficient collection,
organization, and description of data. Results
are useful in identifying quality problems and
as a means of measuring improvement.

Descriptive Statistics
Measures of Central Tendency Mean is the
average score. The mode is the most
frequently occurring score. The median is the
middle most score.

N
X
N
i
i
=
=
1

n
X
X
N
i
i
=
=
1
MEAN PROPORTION
Population:





Sample:


n
q
p =
N
Q
= t
MEDIAN
Descriptive Statistics
Measures of Dispersion Range is the
difference between the highest and lowest
score. We usually use two other measures of
dispersion: Variance which is the average
squared distance between each score and the
mean and Standard Deviation which is the
average distance between each score and the
mean.

Range

LS HS R =
Standard Deviation Variance
Population:



Sample:

( )
N
x
N
i
i
=

=
1
2

o
( )
n
x x
s
n
i
i
=

=
1
2
( )
N
x
N
i
i
=

=
1
2
2

o
( )
n
x x
s
n
i
i
=

=
1
2
2
Measures of Central Tendency and
Dispersion by Level of Measurement
Statistical Analysis with Microsoft
Excel
Microsoft Excel provides data analysis tools,
called the Analysis ToolPack. To view a list of
available analysis tools, click on Data Analysis
group under the Data Tab in the menu. A
second useful tool is the Histogram tool.
A histogram is a representation of a frequency
distribution by means of rectangles whose
widths represent class intervals and whose
areas are proportional to the corresponding
frequencies.
Statistical Inference
It is the process of drawing conclusions about
unknown characteristics of a population from
which the data were taken.

Sampling Distributions It is a distribution of
all possible statistics calculated from all
possible samples of size n drawn from a
population. Samples are drawn to infer
something about the population.

Statistical Inference
For Simple Random Sampling
The expected value of the sample mean is the
population mean.

The standard deviation of the sample mean
(often called standard error of the mean):
Infinite: Finite:


( ) = x E
n
x
o
o =
n
N
n N
x
o
o
1

=
Central Limit Theorem
As the variance decreases, the sample size
increases. Normal distribution is
approximately 30 in its sample size.
If the population is known to be normal, the
distribution of the sample mean is normal for
any sample size.

Sampling distribution n = 3
5 4 3 2 1
Sampling distribution n = 4
5 4 3 2 1
Means (n=30)
4 3 2
Means (n=60)
4 3 2
Means (n=120)
4
3
2
For Sampling Distribution of
p
:
The expected value of the sample mean is the
population mean.

The standard deviation of the sample mean
(often called standard error of the mean):
Infinite: Finite:


( ) t = p E
( )
n
s
p
t t
=
1
( )
n N
n N
s
p
t t

=
1
1
Statistical Inference
Confidence of Intervals It is an estimate of
population parameter that specifies the
likelihood that the interval contains the true
population parameter. Commonly used
confidence levels are 90, 95 and 99. The higher
the cf, the more assurance we have that the
interval contains the true population parameter.

expressed as a percentage.

o =1 cf
Statistical Inference
Hypothesis Testing It involves drawing
inferences about two contrasting propositions
(hypotheses) relating to the value of a population
parameter, one of which is assumed to be true in
the absence of contradictory data.
The null hypothesis is the proposition that
implies no effect or no relationship.
The alternative hypothesis is the proposition that
implies with effect or has a relationship.
The level of significance is denoted by and
determines the size of the rejection region.


Steps:
Formulate the hypotheses to test.
Select a level of significance.
Determine a decision rule.
Collect data and calculate a test statistic.
Apply the decision rule to the test statistic and
draw a conclusion.

Decision Making:
Critical Value Method one of the methods that
leads to a decision about rejection or non-rejection
of the null hypothesis, wherein critical values are
the tabular values of the test statistic that divides
the rejection and non-rejection region.

1. If the computed value is within the non-
rejection region, the null hypothesis is
accepted.
2. If the computed value lies or falls on the
rejection region, the null hypothesis is rejected.


Decision Making:
P-Value Method P stands for PROBABILITY, it
is referred to as the observed level.

1. If P-value is less than or equal to alpha ,
then is rejected.
2. If P-value is greater than alpha ,
then is not rejected.

( ) o s P
0
H
( ) o > P
0
H