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Business Statistics Problems

The document discusses various problems related to calculating arithmetic mean (A.M.) from data sets. It provides examples of calculating A.M. using both the direct method of summing all values and dividing by the total number, and the shortcut method of assuming a mean, calculating deviations from it, and using the formula A.M. = Assumed Mean + Sum of Deviations/Total Values. It also discusses calculating A.M. for discrete and continuous data sets, and provides the formula for finding the combined mean of two data groups. Finally, it discusses calculating the median value for individual and discrete data sets.

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0% found this document useful (0 votes)
127 views

Business Statistics Problems

The document discusses various problems related to calculating arithmetic mean (A.M.) from data sets. It provides examples of calculating A.M. using both the direct method of summing all values and dividing by the total number, and the shortcut method of assuming a mean, calculating deviations from it, and using the formula A.M. = Assumed Mean + Sum of Deviations/Total Values. It also discusses calculating A.M. for discrete and continuous data sets, and provides the formula for finding the combined mean of two data groups. Finally, it discusses calculating the median value for individual and discrete data sets.

Uploaded by

Revathi
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Problems on arithmetic mean

Individual series:

1. The monthly expenditures of 10 families are recorded below

Expenditures – 1500, 2500, 2300, 5000, 4200, 4500, 3500, 3000, 2800, 2000

Calculate A.M by using 1) Direct method 2) short cut method

Sol: Direct method:

A.M ( X) = ∑X= 1500+2500+2300+5000+4200+4500+3500+3000+2800+2000

N 10

Expenditure
(X)
1500
2500
2300
5000
4200
4500
3500
3000
2800
2000
= ∑X= 1500+2500+2300+5000+4200+4500+3500+3000+2800+2000

N 10

= 31300/10 = 3130

A.M(X) = 3130

Short cut method : A.M(X) = A+ ∑d

A = assumed mean ; A =
Expenditure D= X-A(4200)
(X)
1500 1500-4200= -2700
2500 2500-4200 = -1700
2300 2300-4200= -1900
5000 5000-4200 = 800
4200 (A) 4200-4200 = 0
4500 4500 – 4200 = 300
3500 3500-4200 = -700
3000 3000-4200 = -1200
2800 2800-4200 = -1400
2000 2000-4200 = -2200
∑X =31300 ∑d = -10,700

∑d = -11800+1100

∑d = -10700 ∑X =31300

A.M (X) = A + ∑d

A.M (X) = 4200 + (-10,700)

10

= 4200 -1070 = 3130

A.m(X) = 3130

2) Calculate A.M for the following data in the below.

28, 29, 30, 35, 45, 15, 16, 27, 32, 10, 32

Direct method :

X
28
29
30
35
45
15
16
27
32
10
32

Short cut method:

X D = X-A
28
29
30
35
45
15
16
27
32
10
32

Discrete Series:

3) Calculate A.M for the following data

X 0 1 2 3 4 5
f 3 7 10 8 6 2

X f fx
0 3 3*0 = 0
1 7 7*1 = 7
2 10 10*2 = 20
3 8 8*3 = 24
4 6 6*4 = 24
5 2 2*5 = 10
∑f = 36 ∑fx = 85
Direct method :

A.M (X) = ∑fx =85/36 =2.36

∑f

A.m (X) = 2.36

4. Calculate A.M for the following data

X 0 5 10 15 20 25 30
f 8 12 20 26 22 14 9

Sol :

X f fx
0 8 8*0 = 0
5 12 12*5 = 60
10 20 20*10 = 200
15 26 26*15 = 390
20 22 20*22 = 440
25 14 25*14 = 350
30 9 30*9 = 270
∑f = ∑ fx = 1710
111

A.M (X) = ∑fx = = 1710/111 = 15.40

∑f

Continuous series:

Calculate the A.M for the following data

Class 0 – 10 10 -20 20-30 30-40 40-50


Frequency 3 7 10 8 2
(f)

Class Frequency (f) Mid point fm


0 - 10 3 0+10/2 = 5 3*5 = 15
10-20 7 10+20 = 30/2 =15 7*15 =105
2

20-30 10 20+30 = 50/2 = 25 10*25 =250


2

30-40 8 30+40 = 70/2 = 35 8* 35 = 280

40-50 2 40+50 = 90/2 =45 2*45 =90


2

∑f = 30 ∑fm = 740

Mid point = lower limit + upper limit

A.M (X) = ∑fm = 740 / 30 = 24.66

∑f

2. calculate A.M for the following data

Marks 0-9 10-19 20-29 30-39 40-49 50-59 60-69 70-79


No. of 8 18 24 32 22 14 7 2
students
(f)
Sol :

Marks No. of students (f) Mid point (m) fm


0-9 8 0+9 = 9/2 = 4.5 8*4.5 =36
2

10-19 18 10+19 = 29/2 = 14.5 18*14.5 = 261

20-29 24 20+29 49/2 = 24.5 24*24.5 = 588


2=

30-39 32 30+39/2 = 69/2 = 34.5 32*34.5 =1104


40-49 22 40+49/2 = 89/2 = 44.5 22*44.5 = 979
50-59 14 50+59/2 = 109/2 = 14*54.5=763
54.5
60-69 7 60+69/2 = 129/2 = 7*64.5 = 451.5
64.5
70-79 2 70+79/2 = 149/2 = 2*74.5 = 149
74.5
∑f = 127 ∑fm = 4331.5

Mid point = lower limit + upper limit

A.M (X) = ∑fm = 4331.5 / 127= 34.11

∑f

Practice problems :

Calculate the average salaries of the employees from the following data

Wages 0-100 100-2 200-3 300-4 400-5 500-6 600-7


00 00 00 00 00 00
No. of 18 26 32 44 30 25 15
employees
1. Calculate the A.M for the following data by using direct method and short cut
method

Wages 0-500 500-1 1000- 1500- 2000- 2500- 3000- 3500-


000 1500 2000 2500 3000 3500 4000
No. of 8 12 18 26 30 22 17 9
employees

Wages No. of Mid point (m) D = m-A(1750) Fd


employee (f)
0-500 8 0+500/2 = 250-1750 = 8*(-1500)=
500/2 = 250 -1500 -12000
500-1000 12 500+1000/2= 750-1750= 12*(-1000)=
1500/2 = 750 -1000 -12000
1000-1500 18 1000+1500/2 = 1250-1750= 18*(-500)=
2500/2 =1250 -500 -9000
1500-2000 26 1500+2000/2 = 1750-1750 = 0 26*0=0
3500/2 =1750
(A)
2000-2500 30 2000+2500/2 = 2250-1750 30*500=15000
4500/2 = 2250 =500
2500-3000 22 2500+3000/2 = 2750-1750= 22*1000=22000
5500/2 = 2750 1000
3000-3500 17 3000+3500 = 3250-1750= 17*1500=25500
6500/2 = 3250 1500
3500-4000 9 3500+4000/2 = 3750-1750= 9*2000=18000
7500/2 =3750 2000

∑f=142 ∑fd
=(-33000)+8050
0 = 47500

Short cut method (continuous series)

A.M(X) = A + ∑fd = 1750+ 47500 =1750+334.50 = 2084.5

∑f 142

A.M(X) = 2084.5
Combined Mean:

If X1 and X2 are the means of N1 and N2 observations then the combined mean of two
groups is

Combined mean (X12) =

N1 X1 + N2 X2

N1+ N2

1) In a company the average wages of 500 male workers is Rs.2380, the average wages
of 400 female workers is Rs.2220 then find combined mean of male and female.

Sol: Combined mean (X12) =

N1 X1 + N2 X2

N1+ N2

N1 = 500 X1 = 2380, N2 = 400 X2 = 2220

= (500*2380)+(400*2220) = 11,90,000+ 8,88,000 = 20,78,000/900

500+400 900

Combined mean (X12) = 2308.88

2) calculate the combined mean of the following data

N1=50 , N2 = 60, N3 = 55

X1 = 48, X2=75, X3=70

Combined mean (X12)= N1 X1 + N2 X2 + N3 X3

N1+ N2+N3

Median: it is also known as positional average. It is used to find the location of central
value, this is the second measure of central tendency.

Median for individual series :


1. calculate median for the following observations

8,10,12,2,6,14,6.

Sol : arrange the data in ascending order

2, 6, 6, 8, 10, 12, 14

Median = 8

2. calculate median for the following data

12,26,14,18,6,9,9,10

Sol : first arrange the data in ascending order

6, 9, 9 , 10, 12, 14, 18 , 26

Median = 10+12 /2 = 22/2 = 11

Median = 11

Median for Discrete series:

1. Calculate the median for the following data

X 5 2 3 1 0 4
F 6 10 22 14 4 9

Sol :

Step 1 : arrange data in ascending order of magnitude

X F Cumulative frequency (CF)


0 4 4
1 14 4+14 = 18
2 10 18+10 = 28
3 22 28+22 = 50
(median)
4 9 50+9 = 59
5 6 59+6 = 65
N = 65

Median item = size of (N+1) th term

Size of 65+1 th term

Size of ( 66/2)th term

Size of 33th item

Now look at the item C.F column check whether 33 or next higher number i.e.50

Corresponding to 50, the value of X is 3.

Median = 3

2. Find median

X 0 5 10 15 20 25 30
f 6 8 12 22 20 14 9

Sol :

X F Cumulative frequency
0 6 6
5 8 6+8= 14
10 12 14+12=26
15 22 26+22=48
20 20 48+20=68
25 14 68+14=82
30 9 82+9=91
N =91
Median item = size of (N+1)th term

= size of (91+1)th term

= size of (92/2) th term

Size of (46 th) term

Now look at the CF column check whether 46th term is there or higher to it is there. i.e.
48 corresponding to 48 is value X =15

Median = 15

Median Continuous series:

Median = l + N/2 - CF *c

1. Calculate the median for the following data

Class 0-10 10-20 20-30 30-40 40-50 50-60


Frequency 3 7 10 15 6 4

Sol:

Class interval F CF
0-10 3 3
10-20 7 3+7 = 10
20-30 10 10+10 = 20 CF
30-40 15 f 20+15 = 35
40-50 6 35+6 = 41
50-60 4 41+4 = 45
N=
45

Median item = size of (N/2)th term

Median item = size of (45/2)th term

= size of 22.5 th item

l = 30 N/ 2 = 22.5 , cf = 20 f = 15 C = 10

median = l + N/2 - cf *C

= 30 + 22.5-20 * 10

15

= 30 + (2.5/15)*10

= 30 + (0.167) *10

= 30+1.67

Median = 31.67

2 )find median for the following data

Income 0-100 100-20 200-30 300-40 400-50 500-60


(Rs.) 0 0 0 0 0
No. of 8 20 27 25 22 10
workers

Mode: Mode is the number which repeated more no. of times or the value which have
maximum frequency.
If sometimes different numbers may repeat same no. of times then, the mode is known
as bimodal

Case 1 : mode for individual series

In individual series mode can be calculated by inspection method I.e. the number which
is repeated more no. of times.

1. Calculate mode for the following data

8, 10, 2, 6, 9, 14, 6, 4, 1, 6, 0, 12, 6

Mode = 6

Since the number 6 is repeated more no. of times

2. find mode for the following data

22, 26, 12, 12, 18, 14, 6, 4, 9, 13, 13, 12, 2, 13, 20

Mode = 12 and 13 (bimodal)

Here 12 and 13 repeated same no. of times this type of mode is called bimodal

Case 2 : mode for Discrete series

Note : if the inspection method fails I.e.

1. The highest frequency either occurred in the beginning or at the end

2. If the difference between highest frequency and preceding or succeeding is very less
(0 or 1). In this case we can say that inspection method fails.

We have to apply grouping and analysis table

Mode under discrete series the value which have maximum frequency

Calculate mode for the following data

Marks (X) 0 1 2 3 4 5
No. of 8 12 16 20 14 5
(f)students

1. before 20 = 20-16 = 4 which is more than 0 and 1


2. after 20 = 20-14 = 6 which is more than 0 and 1

The inspection method applied

Here mode = 3 since the number 3 is having maximum frequency that is 20

Grouping and analysis table

Grouping table : step 1 : grouping table consists of 6 columns in column I consider the
given frequencies.

Step 2 : in column II group them into two’s

Step 3: in column III leave the first frequency and the group the remaining two

Step 4: in column IV group them into three’s

Step 5 : in column V leave the first frequency and the remaining frequencies group
them into three’s

Step 6 : in column VI leave the first two frequencies remaining frequencies group
them into three’s.

Step 8 : prepare the analysis table by tally marks corresponding to the circled
numbers then find the total and select the highest total corresponding values
becomes the mode.

2. calculate mode for the following data

Marks (X) 0 1 2 3 4 5 6 7
No. of 3 7 10 14 13 8 4 1
(f)students
1. The highest frequency either occurred in the beginning or at the end

There fore the highest frequency 22 occurred in the end so inspection method fails

2. If the difference between highest frequency and preceding or succeeding is very less
(0 or 1). In this case we can say that inspection method fails

Sol : here the highest frequency appeared in the ending then the inspection method
fails

2. calculate mode for the following data

Marks (X) 0 1 2 3 4 5 6 7
No. of 3 7 10 14 13 8 4 1
(f)students

Mode for Continuous series:

1. Calculate the mode for the following data

Class 0-10 10-20 20-30 30-40 40-50


Frequency 8 12 20 14 6

Mode for Continuous series =


1. Calculate the mode for the following data

Class 0-10 10-20 20-30 30-40 40-50


Frequency 8 12f0 20 f1 14f2 6

Step : identify the model class 20-30 by applying inspection method.

Mode =

L1 = 20

F1=20 , f2=14 and f0=12

I/C = model class is 20-30 (30-20 = 10)

I/c = 10

Mode = 20 + 20-12 * 10

2*20 – 12-14

Mode = 20 + 40-12-14 *10

Mode = 20 + (8/14)*10

Mode = 20+ 5.71

Mode = 25.71
2. Find mode for the following data

Class 0-9 10-19 20-29 30-39 40-49 50-59


f 3 7 10 15 12 8

Here , the given data is in inclusive series. We convert this inclusive series into exclusive
series by subtracting 0.5 from all lower limits and add 0.5 to all upper limits. Then the
series become exclusive series. Now we can apply usual procedure (apply only to
median and mode)

Class -0.5 -9.5 9.5 – 19.5 19.5 – 29.5 – 39.5 – 49.5 –


29.5 39.5 49.5 59.5
f 3 7 10f0 15 f1 12F2 8

Model class = 29.5 – 39.5

L = 29.5

F1 = 15, f0 = 10 , f2 = 12

i/c = (29.5 – 39.5)(39.5-29.5 = 10)

i/c = 10

mode = 29.5 + 15-10 * 10

2*15-10-12
Mode = 29.5 + (5/8)*10

Mode = 29.5 + 6.25

Mode = 35.75

3. Calculate the mode for the following data

Class 0-10 10-20 20-30 30-40 40-50 50-60 60-70


F 8 28 18 20 24 16 12

Here 28 maximum number appearing in the beginning so inspection method fails.

Then we will go for grouping and analysis table.

Class I II III IV V VI
0-10 8 8+28 = nil 8+28+18=54 nil Nil
10-20 28 36 28+18= 28+18+20= Nil
20-30 18 18+20= 46 66 18+20+24=62
30-40 20 38 20+24=44 20+24+16=60
40-50 24 24+16 24+16+12=
50-60 16 =40 16+12=28 52
60-70 12

Analysis table

Class I II III IV V VI Total


0-10 0
10-20 1 1 1 3
20-30 1 1 1 3
30-40 1 1 1 3
40-50 1 1 1 3
50-60 1 1 2
60-70 0
Mode : 30-40 where the frequency is 20

Mode = 20

Note : Relation between mean, median, mode

Mode = 3 median – 2 mean

1. if mean =10, mode = 12 find median

Mode = 3 median – 2 mean

12 = 3(median) – 2 (10)

12 = 3 median – 20

12+20 = 3 median

32 = 3 median

Median = 32/3

Median = 10.67

2.if median = 21 and mean =21 find mode

Sol : mode = 3 median – 2 mean

Mode = 3*21 – 2 * 21

Mode = 63-42

Mode = 21

Note : if mean = median = mode is known as symmetrical data

Properties of a good average or characteristics of good averages :

1. it should be easy to understand and easy to calculate

2. it should be rigidly defined

3. it should be based on all observations

4. it should be useful for future mathematical treatment


5. it should not be effected by extreme points

6. it should not be effected by fluctuation by sampling

Note : in all measures of central tendency arithmetic mean is best measurem


Measures of dispersion :
Definition of dispersion : dispersion means scatterness of data about the central value.
The following are the measurements to measure the dispersion

● Range
● Quartile deviation (QD)
● Mean deviation (MD)
● Standard deviation (SD)
● Coefficient of QD
● Coefficient of MD
● Coefficient of SD

The first four methods range , QD, SD, MD are known as absolute measures of
deviation
● The methods Coefficient of QD, Coefficient of MD, Coefficient of SD are known as
relative measures of dispersion

● Range : it is the difference between largest value and smallest value of the
distribution
● Range = largest value – smallest value
● Range = L- S

Relative measure of range is known as coefficient of range

coefficient of range = L-S *100

L+S

1. find range , coefficient of range for the following data (Individual series)

6, 7 , 20 , 24 , 9 , 4 , 10 , 15 , 18

Range = L-S = 24-4=20

Coefficient of range =L-S *100

L+S

= 24-4/24+4 *100 = 20/28*100 = 71.42


2. calculate range , coefficient of range for the following data(Discrete series)

X (range) 0 1 2 3 4 5
F 3 7 14 19 4 1
Range = L-S

=L = 5 , S = 0

Range = L-S = 5-0 = 5

Coeff of range = L-S *100 = 5-0 *100 = 5/5 *100 = 100%

L+S 5+0

3. range , coeff of range for continuous series ?

Class 0-10 10-20 20-30 30-40 40-50


F 8 10 28 96 9

Range = L-S

Largest vale = 50, smallest value = 0

Range = 50-0 = 50

Coefficient of range = L-S *100 = 50-0/50+0 *100 = 50/50*100= 100%

L+S

3. range , coefficient of range find?

Class 0-10 10-20 20-30 30-40 40-50


Frequency 8 10 28 96 9
Quartile deviation (QD) = Q3-Q1

2
Quartile deviation is also known as semi inter quartile range

Inter quartile range = Q3-Q1

The relative measure of quartile deviation is known as coefficient of quartile


deviation i.e.

Coefficient of QD = Q3-Q1 *100

Q3+Q1

Decile : decile means dividing the data into ten equal parts then there exist 9
partitions. They are D1, D2,D3……….D9

Percentile : percentile means dividing the data into 100 equal parts then there
exist 99 partitions they are P1,P2,P3…….P99

1. calculate Q1, Q3, QD , D4 and P25 (individual series)


2, 8, 1, 6, 9, 4, 10, 4, 5, 16, 12, 11, 10
Arrange the data in ascending order
1, 2, 4, 4, 5, 6, 8, 9, 10, 10, 11, 12, 16
1, 2, 3, 4, 5, 6, 7, 8, 9 , 10, 11 ,12 , 13
N =13
Th
Q1 = size of 1 N+1 item
4

= size of 1 13+1 th item


4

= size of 1 (3.5) th item(3+0.5)


= size of 3rd item +0.5 (4th item – 3rd item)
= 4+0.5(4-4)
=4+0.5(0)
=4+0= 4
Q1 = 4

2. calculate QD and Coefficient of QD from the following data


21,26,30,32,22,20,18,14,20,25,28,32,34

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