Chapter 1

Question 1

Cases

Answer 1

The objects described by a set of data.

Ex. Customers, companies, subjects in a study, stock

Question 2

Label

Answer 2

Is a SPECIAL VARIABLE used in some data sets to distinguish the different cases

Question 3

Variable

Answer 3

Is a characteristic of the case–> different cases can have different values for variables

Question 4

Observation

Answer 4

Describes the data for a particular case

Question 5

Categorical Variable

Answer 5

Places a case into one of several groups or categories

Ex. Bar Graphs, Pie Charts, and Pareto Charts

Question 6

Quantitative Variable

Answer 6

Takes numerical values arithmetic operations, such as adding and averaging, makes sense

Question 7

Statistical Software

Answer 7

In some statistical software spaces are not allowed in variable names–> instead use an underscore

Question 8

Ordered Categorical Variable

Answer 8

Possible values for a grade…A, B, C, D..etc because A is better than B which is better then C and so on

Question 9

Nominal Variable

Answer 9

A categorical variable that is not ordered

Question 10

Instruments

Answer 10

Different areas of application (marketing) can also have their own special variables–> these variable are measured with instruments

Question 11

Rate

Answer 11

Computing a rate is one of several ways of adjusting one variable to create another–> sometime more meaningful than count

Question 12

Distribution

Answer 12

Describes how to values of a variable vary from case to case

Question 13

Pareto Chart

Answer 13

Categories are ordered from MOST frequent–>least frequent–>most important categories for a categorical variable
Ex. frequently used in quality control settings

Question 14

Histogram

Answer 14

The most common graph of the distribution of a quantitative variable wear we group near values into classes–> for small data sets a stemplot can be used

Question 15

How can you describe the overall pattern of a histogram

Answer 15

You can describe the overall pattern of a histogram by its SHAPE, CENTER, and SPREAD

Question 16

Outlier

Answer 16

The most important type of deviation–> an individual value that falls outside the overall pattern

Question 17

When is a distribution symmetric?

Answer 17

If the right and left sides of the histogram are mirror images of each other

Question 18

Skewed to the right

Answer 18

If the right side of the histogram extends much farther out than the left side..and vice versa

Question 19

Positively skewed

Answer 19

Data that skews to the right–> positive skewness is the MOST common type of skewness that we see in real data

Question 20

Time plot

Answer 20

Plots each observation against the time it was measured–> time on a horizontal and the variable you are measuring on a vertical scale

Question 21

Mean

Answer 21

The most common measure of center is the ordinary arithmetic average–> NOT a resistant measure of center as it can be influenced by outliers

Question 22

Median

Answer 22

The median is the midpoint of a distribution, the number such that half the observations are smaller and half are larger

Question 23

Median Odd

Answer 23

(N+1)/2 observations up from the bottom of the list

Question 24

Median Even

Answer 24

It is the mean of the two numbers in the middle

Question 25

Median vs Mean

Answer 25

The median is more resistant than the mean

Question 26

Median and Mean in a Symmetric Distibution

Answer 26

They are close together--> exactly symmetric exactly the same

Question 27

Median and Mean in a skewed distribution

Answer 27

The mean is farther out on the long tail than the median

Question 28

The five number summary

Answer 28

Boxplot-->consits of the smallest observation, the first quartile, the median, the thrid quartile, and the largest observation --> in order form largest to smallest

Question 29

The five number summary vs. distribution

Answer 29

Not the most common numerical description of distribution

Question 30

Most common numerical description of distribution

Answer 30

The mean to measure the center and the standard deviation to measure the spread

Question 31

Standard deviation

Answer 31

Measures spread by caluculating how far the observations are from their mean--> should only be used when the mean is chosen as the method of center

Question 32

n-1

Answer 32

Degrees of freedom of the variance or standard deviation

Question 33

S=0

Answer 33

Only when ther is no spread--> means all the observations have the same value, otherwise S is greater than 0

Question 34

What does it mean if the standard deviation is higher?

Answer 34

S gets larger when the observations are more spread out across their mean

Question 35

Units

Answer 35

S has the same units of measurement as the original observation

Question 36

S and the Mean

Answer 36

Like the mean, S is not resistant a few outliers or strong skewness can greatly increase S

Question 37

How do you measure risk in finance

Answer 37

Taking a looking at the standard deviation of returns --> large spread --> less predictable--> more risky BUT five number summary would be more informative

Question 38

Density curve

Answer 38

A density curve is a mathematic model for the distribution of a quantitative variable

Question 39

What does a density curve describe?

Answer 39

The overall pattern of a distribution. Thea area under the curve AND within any range of values is the proportion of all observations that fall within that range

Question 40

68-95-99.7 rule

Answer 40

68% of observations fall within 1 standard deviation of the mean 95% of observations fall within 2 standard deviations of the mean 99.7% of observations fall within 3 standard deviations of the mean

Question 41

Z-Score

Answer 41

Standardized value--> tells us how many standard deviations the observation falls away from the mean and in which direction

Question 42

Z-score positive

Answer 42

Observations larger than the mean

Question 43

Z-score negative

Answer 43

Observations smaller than the mean

Question 44

Sample survey

Answer 44

Collects data from a sample of cases that represent a larger population of cases

Question 45

Observation vs Experiment

Answer 45

We do not attempt to influence the responses by imposing a treatment (change)

Question 46

Training Data Set

Answer 46

In some studies we generate one set of data to generate a set of results Ex. model to predict something

Question 47

Database

Answer 47

Data sets for statistical analysis can be extracted

Question 48

Data warehouse

Answer 48

System for organizing, storing, and analyzing complex data

Question 49

Sampling frame

Answer 49

A list of items to be sampled

Question 50

Response rate

Answer 50

The proportion of the original sample who actually provide usable data

Question 51

Undercoverage

Answer 51

Some groups in the population are left out of the process of choosing the sample

Question 52

Nonresponse

Answer 52

Occurs when a case chosen for the sample cannot be contacted or does not cooperate