Heather Vinson
EURO PALLET/351
May 14, 2013
Babak Memarian
Statistics in Business
Statistics is the branch of mathematics used to collect, analyse, interpret and present data. It is used by entrepreneurs to make calculated decisions about the future of their businesses.
Types of statistics
There are two types of statistics. Descriptive statistics deals with describing a set of data elements graphically. This type of statistics do not make any kind of prediction, but rather showing bullet point data type. An example of descriptive statistics were a plot line graph showing the population of the United States in the last ten years. A person looking at this data would easily be able to determine how the population has increased or decreased over the last decade. The data would be insufficient but to determine what the population will be ten years.
The second type of statistics, Inferential statistics. Inferential statistics uses a selection of information to derive a future performance. This is often referred to as a ' best guess ' method of statistics. This type of information is what is used by businesses in particular to make educated decisions for future planning.
Levels of statistics
There are also many levels of statistics.
Nominal level statistics depict items by name or label. Ordinal level statistics have ordered data such as number or letter. Interval level statistics has data sorted by difference or interval between data. An example would be a thermometer in degrees Celsius. These are all great ways to organize data, but more reliable and widely used is the ratio level statistics. In the relationship between the statistics are a natural zero point. This fact gives the interval between data actual meaning. A person can actually compare the measurements with the ratio method.
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