Business Analytics - Descriptive Statistics and Data Summarization

Vocabulary flashcards covering key statistical terminology, data classification types, frequency distributions, and measures of location and dispersion from Business Analytics by James R. Evans.

Statistics

The science of uncertainty and the technology of extracting information from data, as defined by David Hand; it involves collecting, organizing, analyzing, interpreting, and presenting data.

Statistic

A summary measure computed from data.

Descriptive Statistics

Methods of describing and summarizing data using tabular, visual, and quantitative techniques.

Metric

A unit of measurement that provides a way to objectively quantify performance.

Measurement

The act of obtaining data associated with a metric.

Measures

Numerical values associated with a metric.

Discrete Metric

A metric that is derived from counting something (such as the proportion of on-time deliveries, the number of incomplete orders each day, or the number of errors per invoice).

Continuous Metric

A metric based on a continuous scale of measurement involving dimensions such as dollars, length, time, volume, or weight.

Categorical (Nominal) Data

Data that are sorted into categories according to specified characteristics.

Ordinal Data

Data that can be ordered or ranked according to some relationship to one another.

Interval Data

Data that are ordinal but have constant differences between observations and have arbitrary zero points.

Ratio Data

Continuous data that have a natural zero.

Frequency Distribution

A tabular summary that shows the number of observations in each of several nonoverlapping groups.

Histogram

A graphical depiction of a frequency distribution presented in the form of a column chart.

Relative Frequency

The proportion of total observations ($n$) falling into a specific category, calculated as $\frac{\text{Frequency of Category } i}{n}$.

Cumulative Relative Frequency

The proportion of the total number of observations that fall at or below the upper limit of each group.

Cumulative Relative Frequency Distribution

A tabular summary of cumulative relative frequencies.

Ogive

A graphical representation showing cumulative relative frequencies plotted against the upper limits of each group.

Cross-Tabulation (Contingency Table)

A tabular method that displays the number of observations in a data set across subcategories of two categorical variables, where subcategories are mutually exclusive and exhaustive.

Population

All items of interest for a particular decision or investigation.

Sample

A subset of a population selected to obtain sufficient information to draw a valid inference about the population.

Midrange

A measure of location computed as the average of the greatest and least values in a data set: $\frac{\text{Maximum} + \text{Minimum}}{2}$.

Dispersion

The degree of variation in data; that is, the numerical spread or compactness of the observations.

Range

The difference between the maximum value and the minimum value in a data set, calculated in Excel as $=\text{MAX}(\text{data range}) - \text{MIN}(\text{data range})$.

Interquartile Range (IQR)

The difference between the first and third quartiles ($Q_3 - Q_1$), also known as the midspread, representing the middle $50\%$ of the data.

Coefficient of Variation (CV)

A relative measure of dispersion that compares the standard deviation to the mean, allowing comparison of risk or variability across data sets with different scales.

z-score

A standardized measure that quantifies how many standard deviations an observation lies above or below the mean.

Outlier

An extreme observation that deviates significantly from the overall pattern of the data (often identified when a z-score exceeds $\pm 3$).