Basic Business Statistics Hardcover

Running head: BASIC BUSINESS STATISTICS 1
Basic Business Statistics
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BASIC BUSINESS STATISTICS 2
Basic Business Statistics
Introduction
ABZ is a global corporation that deals with the sales of different categories of products including
DVD, CD, and books which include classical, novel, politics and bestsellers. The organization is
faced with the challenge of increasing sales, revenue and profit and thus conducts a survey and
collects data for customer demographics and sales to identify the reasons behind the problem.
The objective of this paper is to conduct statistical analysis on the data collected by the
organization with an aim of providing the best recommendations that would lead to improvement
of the sales, revenue and profit. To achieve the objective, the data is analyzed using descriptive
numerical measures and visualization graphs to draw meaningful conclusions for easy decision
making.
Description of Variables, Data Types and Measurement Scales
The table is a summary for the variables in customer attribute data, their types and levels of
measurement.
Dataset 1- Customer Attributes
Variable Type Level of Measurement Description
Customer_Id Discrete Numeric Nominal Unique ID of each customer
Gender Coded Categorical Nominal 1. Male and 2. Female
Marial Status Coded Categorical Nominal 1. Married and 2. Single
Age Continous Numeric Ratio The age of the customer
Type of Customer Coded Categorical Nominal 1. Regional and 2. Promotional
Region Coded Categorical Nominal 1. East, 2. West, 3. North and 4. South
Payment Coded Categorical Nominal 1. Paypal and 2. Credit
Source Coded Categorical Nominal 1.Web and 2. Email
Amount Paid Continous Numeric Ratio The amount paid by customer for product
Product Coded Categorical Nominal 1. DVD, 2. CD, 3. Novel, 4. Classical, 5. Politics, and 6 Best seller
Salary Continous Numeric Ratio The salary of the customer

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The following table describes the variables in sales data, their type and levels of measurement.
Dataset 2-Sales
Variable Type Level of Measurement Description
Days Discrete Numeric Interval Days of Transaction
Opening Gross Sales Continous Numeric Ratio Opening Gross Sales
Total Gross Sales Continous Numeric Ratio Total Gross Sales for the days
Price over earning ratio Continous Numeric Ratio Price over earning ratio
Gross profit margin Continous Numeric Ratio Gross profit margin in percentage
Revenue Continous Numeric Ratio Revenue
Descriptive Statistics for numeric variables
Descriptive statistics for numeric variables include measures of location and measures of
variation. The are summarized in the table below.
Measures of Location
Age Amount Paid Salary Opening Gorss Sales Total Gross Sales Price/Earning Ratio Gross Profit Margin Revenue
Sample average 43.08 39.79 47.47 27.51 90.47 23.57 26.32 286.46
Median 42.00 20.50 47.50 19.08 72.40 20.60 22.90 269.00
25th Percentile 32.00 17.70 44.00 12.97 39.35 8.80 9.70 252.25
75th Percentile 50.00 23.27 52.00 32.06 107.08 35.80 36.40 298.00
Measures of Variation
Variance 152.33 3314.22 44.02 697.79 4606.08 262.59 317.54 3552.81
Standard Deviation 12.34 57.57 6.63 26.42 67.87 16.20 17.82 59.61
Minimum 20.00 15.08 26.00 0.07 29.14 3.60 3.60 229.00
Maximum 78.00 246.67 65.00 169.19 381.01 68.20 74.20 539.00
Range 58.00 231.59 39.00 169.12 351.87 64.60 70.60 310.00
IQR 18 5.57 8 19.09 67.72 27.00 26.70 45.75
Descriptive Statistics for Numeric Variables
From the table above, the numeric variables are shown as columns and include age, amount paid,
salary, opening gross sales, total gross sales, price/earning ratio, gross profit margin and revenue.
The measures of location determined are the sample average, the median, 25th percentile and 75th
percentile. Sample average and mean indicate the approximate center value in the distribution of
each variable if either of the measures is chosen, the 25th and 75th percentile show that 25% and
7% of the values in a given variable distribution falls below that value. On the other hand, the
measures of dispersion or variation determined variance, standard deviation, range and
interquartile range. The range is the difference between maximum and minimum while

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interquartile range is the difference between the 25th percentile (1st quartile) and 75th percentile
(3rd quartile). The variable with higher values of the measures of dispersion has the highest level
of spread/dispersion.
Discussion of whether we can determine Numeric measures for Nominal and Ordinal
Categorical variables
It is not possible to determine the numeric measures of location and variation for ordinal and
categorical variables. Nominal variables are applied in the labeling of variables and have no
quantitative or numerical significance and hence not possible to determine descriptive statistics
of location and variation for them. On the hand, ordinal variables are almost similar to nominal
variables except the labels have some rank or order. The numerical measures for these types of
variables can only be expressed either as frequencies, proportions or percentages.
Data summarizing
Frequency tables and corresponding graphs for two different categorical variables
The three categorical variables selected are gender, customer type and marital status. Bar chart
and pie chart have been used as the recommended charts for visualization respectively.
Gender and Customer type
The frequency table for gender is illustrated below.
Gender Count of Type of Customer
1 28
2 372
Grand Total 400
Since code 1 represents male and code 2 represent female for gender and 1 is regular and 2
promotional for customer type, it means that the sample data had a total of 372 females who
were regular customers and 28 male individuals who were promotional. The above frequency
table can be visualized using the bar chart below.