SUMMARY

Statistics is an important decision-making tool in business and is used in virtually every area of business. In this course, the word statistics is defined as the science of gathering, analyzing, interpreting, and presenting numerical data.

The study of statistics can be subdivided into two main areas: descriptive statistics and inferential statistics. Descriptive statistics result from gathering data from a body, group, or population and reaching conclusions only about that group. Inferential statistics are generated from the process of gathering sample data from a group, body, or population and reaching conclusions about the larger group from which the sample was drawn.

Most business statistics studies contain variables, measurements, and data. A variable is a characteristic of any entity being studied that is capable of taking on different values. Examples of variables might include monthly household food spending, time between arrivals at a restaurant, and patient satisfaction rating. A measurement is when a standard process is used to assign numbers to particular attributes or characteristics of a variable. Measurements on monthly household food spending might be taken in dollars, time between arrivals might be measured in minutes, and patient satisfaction might be measured using a 5-point scale. Data are recorded measurements. It is data that are analyzed by business statisticians in order to learn more about the variables being studied.