Application of Statistics in Daily Life

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  • 0:04 Definition of Statistics
  • 1:05 Statistical Process Stages
  • 2:40 Applications of Statistics
  • 4:18 Three Statistical Measures
  • 5:44 Common Concerns about…
  • 6:34 Lesson Summary
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Lesson Transcript
Instructor: Beverly Maitland-Frett

Beverly has taught mathematics at the high school level and has a doctorate in teaching and learning.

Statistics is a major mathematical component of our world that some depend on and others hardly give a passing glance. Statistics has significant value and is used in areas from government to big business. This lesson gives a brief introduction to this broad field.

Definition of Statistics

Timmy is a pizza shop manager and he has two locations picked for a possible new location. He decides to conduct a mini-study to decide based on a variety of factors. Location A is smaller, and he notices that there is a high school two blocks away, some business offices close by, and a laundromat next door. Location B is larger and next to a supermarket with some business offices scattered around the area, amidst several vacant lots. If you were Timmy, which would you choose?

You are a statistician in many ways. Statistics is the method of conducting a study about a particular topic by collecting, organizing, interpreting, and finally presenting data. Being a statistician at an elementary level may simply mean noticing patterns in daily circumstances and drawing conclusions about those patterns. On a grander scale, statisticians may spend months or years conducting a study before they can produce meaningful analysis of information. Statistics is its own community, with rules, procedures, and policies all built on simple mathematical principles.

Stages in the Statistical Process

The statistical process guides genuine study, and statisticians are exacting in their methodologies. The major steps of statistics are explained in a simplistic form as follows:

  1. Planning a study: There must be a subject that requires investigation. Planning entails deciding what instruments (interviews, surveys, etc.) to use, who to speak with, and how to analyze findings. Instruments, in this case, are tools used in conducting a study like surveys, interviews, etc. Do you remember Timmy? In this stage, he plans to interview shoppers and count people.
  2. Organizing the data: The best way to obtain the valid answers is to organize the information effectively to help expose patterns and other significant relationships. There are a variety of software programs that can help with this step. Once Timmy has gathered data, he could perform calculations of the mean, mode, and median visitors.
  3. Interpreting the data: This is the heartbeat of statistics. Interpretations can have lasting repercussions, and it's important to make sure they are valid assumptions and supported by mathematical reasoning. Timmy, based on his interpretations of the numbers, could make plans to have special sales on days with the most traffic.
  4. Presenting the data: The methods you chose to present the data can make findings more interesting or powerful. People use graphs, tables, and various diagrams to show relationships between data. With this information, Timmy could present compelling arguments using his analysis so that he and his business partners can discuss the most profitable possibilities for the pizza shop.

Applications of Statistics

Other than individuals and small businesses owners like Timmy who conducted their own studies, there are some entities who thrive on statistics. Here are a few major examples.

Government Agencies

The government uses statistics to make decisions about populations, health, education, etc. It may conduct research on education to check the progress of high schools students using a specific curriculum or collect characteristic information about the population using a census.

Science and Medicine

The medical field would be far less effective without research to see which medicines or interventions work best and how the human bodies react to treatment. Medical professionals also perform studies by race, age, or nationality to see the effect of these characteristics on health.

Psychology

Although this is attached to both the science and medical field, success in psychology would be impossible without the systematic study of human behavior, often analyzing results statistically.

Education

Teachers are encouraged to be researchers in their classrooms, to see what teaching methods work on which students and understand why. They also should evaluate test items to determine if students are performing in a statistically expected way. At all levels of education and testing there are statistical reports about student performance, from kindergarten to an SAT or GRE.

Large Companies

Every large company employs its own statistical research divisions or firms to research issues related to products, employees, customer service, etc. Business success relies on knowing what is working and what isn't.

Three Major Statistical Measures

In many cases, basic statistical analysis can be done by using three main concepts: the mean, the median, and the mode.

Mean

The mean is the mathematical average. For example, a laundromat may conduct a study to see how many people use a machine each day, then calculate the average for each week.

  • Sun: 105
  • Mon: 50
  • Tues: 40
  • Wed: 50
  • Thurs: 70
  • Fri: 80
  • Sat: 95

The mean is the sum of the items divided by the number of items. In this case, we have seven items, so: mean = (105 + 50 + 40 + 50 + 70 + 80 + 95) / 7 = 70 people

Mode

The mode is the number that occurs most frequently in the data set. If we first organize the data in ascending order we get: 40, 50, 50, 70, 80, 95, 105. You can see 50 is the mode because it occurs twice while every other number occurs just once.

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