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Statistical Analysis: Using Data to Find Trends and Examine Relationships

Statistical Analysis: Using Data to Find Trends and Examine Relationships
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  • 0:06 Making Sense of Data
  • 1:46 Descriptive Statistics
  • 2:55 Inferential Statistics
  • 5:59 Predictive Statistics
  • 7:57 Statistical Software
  • 8:56 Lesson Summary
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Lesson Transcript
Instructor: Paul Zandbergen

Paul has a PhD from the University of British Columbia and has taught Geographic Information Systems, statistics and computer programming for 15 years.

Many different organizations use statistical analysis to describe and analyze data and to predict future trends. Learn about the different types of statistics in this video lesson.

Making Sense of Data

The amount of data that we as humans generate every day is overwhelming. Consider that every purchase of any product anywhere is a piece of data. Every phone call is a piece of data. Every post to social media is a piece of data. Advances in computer systems make it possible to store all this data.

A CEO of a major technology company recently said that humanity now creates as much data every day as we did from the dawn of civilization up until the year 2000. That's a ton of data! And, the pace at which we generate the data continues to increase.

How do we make sense of all this data? Let's say you are running a company that makes accessories for mobile phones, and you sell these to retail stores. You want to know how sales are doing. One of your managers tells you the sales team made sales to 800 retail stores in January. Do you want to see 800 different sales reports? No, you want some type of summary. For example, you may want to know the total of all sales combined and the average value of those sales. Or, perhaps you want to see the 10 largest sales. You can obtain this information using statistical analysis.

Statistics is a field of study within mathematics. It involves the collection, analysis, interpretation and presentation of data for decision making in organizations. Many different organizations use statistical analysis to describe and analyze data and to predict future trends.

Descriptive Statistics

There are several types of statistics. The first type is descriptive statistics, which does just what the term suggests. It describes the existing data, using measures such as average, sum and others. This is the earlier example of the sales reports. You want to know things like the total value of all sales combined and the average value of those sales.

Descriptive statistics allow you to summarize large amounts of data. You use these on a regular basis in everyday life, so they are very intuitive. When you say you are going out for dinner on average twice per week, you're using descriptive statistics. Or, consider your GPA in high school or college. Your GPA is a measure of your average grade for all your coursework. Descriptive statistics also looks at variability of data. For example, if your GPA is exactly a 3.0, did you get mostly Bs or did you get a lot of As and Cs? Both cases result in the same average but represent a very different academic record.

Inferential Statistics

The second type is inferential statistics, which tries to infer something about the data. In other words, you are trying to find patterns and relationships in the data. Inferential statistics often involves statistical testing. For example, let's say you want to increase the sales of your company, which makes mobile phone accessories. You're selling your products to retail stores across the entire nation, and you're going to run an advertising campaign on TV, hoping to increase demand for your products.

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