Basic Business Statistics : Concepts and Applications

by Berenson, Mark L.; Levine, David M.; Krehbiel, Timothy C.

• ISBN13: 9780131678316
• ISBN10: 0131678310
• Edition: 10th
• Format: Hardcover w/CD
• Copyright: 2009-01-01
• Publisher: Prentice Hall

Summary

For a 1 or 2 semester course in Business Statistics.This comprehensive, 18 chapter hardcover text focuses on using rich business applications from all the functional areas of business to introduce the core concepts. The focus is on providing a sophisticated, uncluttered (by bells and whistles) approach.A briefer version is also available: Business Statistics: A First Course 4e.

Table of Contents

Preface	xxv
Introduction and Data Collection	1	(20)
Using Statistics: Good Tunes	2	(1)
Basic Concepts of Statistics	2	(2)
The Growth of Statistics and Information Technology	4	(1)
How This Text Is Organized	5	(2)
Collecting Data	7	(1)
Identifying Sources of Data	7	(1)
Types of Data	8	(13)
Levels of Measurement and Types of Measurement Scales	9	(2)
Summary	11	(1)
Key Terms	11	(1)
Chapter Review Problems	12	(1)
Introduction to the Web Cases	13	(1)
Introduction to Using Statistical Programs	14	(1)
Using Windows	14	(2)
Introduction to Microsoft Excel	16	(3)
Introduction to Minitab	19	(2)
CD-ROM Topic: Introduction to Spss
Presenting Data in Tables and Charts	21	(50)
Using Statistics: Comparing the Performance of Mutual Funds	22	(1)
Tables and Charts for Categorical Data	22	(7)
The Summary Table	22	(1)
The Bar Chart	23	(1)
The Pie Chart	24	(1)
The Pareto Diagram	25	(4)
Organizing Numerical Data	29	(3)
The Ordered Array	30	(1)
The Stem-and-Leaf Display	30	(2)
Tables and Charts for Numerical Data	32	(11)
The Frequency Distribution	32	(2)
The Relative Frequency Distribution and the Percentage Distribution	34	(1)
The Cumulative Distribution	35	(2)
The Histogram	37	(1)
The Polygon	38	(2)
The Cumulative Percentage Polygon (Ogive)	40	(3)
Cross Tabulations	43	(4)
The Contingency Table	43	(2)
The Side-by-Side Bar Chart	45	(2)
Scatter Diagrams and Time-Series Plots	47	(4)
The Scatter Diagram	47	(1)
The Time-Series Plot	48	(3)
Misusing Graphs and Ethical Issues	51	(20)
Summary	54	(1)
Key Terms	55	(1)
Chapter Review Problems	55	(7)
Managing the Springville Herald	62	(1)
Web Case	62	(1)
Using Software for Tables and Charts	63	(1)
Microsoft Excel	63	(3)
Minitab	66	(5)
CD-ROM Topic: Using SPSS for Tables and Charts
Numerical Descriptive Measures	71	(54)
Using Statistics: Evaluating the Performance of Mutual Funds	72	(1)
Measures of Central Tendency, Variation, and Shape	72	(22)
The Mean	73	(2)
The Median	75	(1)
The Mode	76	(1)
Quartiles	77	(2)
The Geometric Mean	79	(1)
The Range	80	(1)
The Interquartile Range	81	(1)
The Variance and the Standard Deviation	82	(3)
The Coefficient of Variation	85	(1)
Z Scores	86	(2)
Shape	88	(1)
Visual Explorations: Exploring Descriptive Statistics	88	(1)
Microsoft Excel Descriptive Statistics Output	89	(1)
Minitab Descriptive Statistics Output	90	(4)
Numerical Descriptive Measures for a Population	94	(5)
The Population Mean	94	(1)
The Population Variance and Standard Deviation	95	(1)
The Empirical Rule	96	(1)
The Chebyshev Rule	97	(2)
Computing Numerical Descriptive Measures from a Frequency Distribution	99	(2)
Exploratory Data Analysis	101	(5)
The Five-Number Summary	102	(1)
The Box-and-Whisker Plot	103	(3)
The Covariance and the Coefficient of Correlation	106	(6)
The Covariance	106	(2)
The Coefficient of Correlation	108	(4)
Pitfalls in Numerical Descriptive Measures and Ethical Issues	112	(13)
Ethical Issues	113	(1)
Summary	113	(1)
Key Formulas	114	(1)
Key Terms	114	(1)
Chapter Review Problems	115	(6)
Managing the Springville Herald	121	(1)
Web Case	121	(1)
Using Software for Descriptive Statistics	121	(1)
Microsoft Excel	121	(1)
Minitab	122	(3)
CD-ROM Topic: Using SPSS for Descriptive Statistics
Basic Probability	125	(32)
Using Statistics: The Consumer Electronics Company	126	(1)
Basic Probability Concepts	126	(9)
Events and Sample Spaces	128	(1)
Contingency Tables and Venn Diagrams	129	(1)
Simple (Marginal) Probability	129	(2)
Joint Probability	131	(1)
General Addition Rule	132	(3)
Conditional Probability	135	(8)
Computing Conditional Probabilities	135	(2)
Decision Trees	137	(1)
Statistical Independence	138	(2)
Multiplication Rules	140	(3)
Bayes' Theorem	143	(4)
Counting Rules	147	(3)
Ethical Issues and Probability	150	(7)
Summary	151	(1)
Key Formulas	151	(1)
Key Terms	152	(1)
Chapter Review Problems	152	(2)
Web Case	154	(1)
Using Software for Basic Probability	155	(1)
Microsoft Excel	155	(2)
Some Important Discrete Probability Distributions	157	(34)
Using Statistics: The Accounting Information System of the Saxon Home Improvement Company	158	(1)
The Probability Distribution for a Discrete Random Variable	158	(4)
Expected Value of a Discrete Random Variable	159	(1)
Variance and Standard Deviation of a Discrete Random Variable	160	(2)
Covariance and Its Application in Finance	162	(4)
The Covariance	162	(1)
The Expected Value, Variance, and Standard Deviation of the Sum of Two Random Variables	163	(1)
Portfolio Expected Return and Portfolio Risk	164	(2)
Binomial Distribution	166	(9)
Poisson Distribution	175	(4)
Hypergeometric Distribution	179	(3)
The Mean	180	(1)
The Standard Deviation	180	(2)
CD-ROM Topic: Using the Poisson Distribution to Approximate the Binomial Distribution	182	(9)
Summary	182	(1)
Key Formulas	183	(1)
Key Terms	183	(1)
Chapter Review Problems	184	(3)
Managing the Springville Herald	187	(1)
Web Case	188	(1)
Using Software for Discrete Probability Distributions	188	(1)
Microsoft Excel	188	(1)
Minitab	189	(2)
The Normal Distribution and Other Continuous Distributions	191	(36)
Using Statistics: Download Time for a Web Site Homepage	192	(1)
Continuous Probability Distributions	192	(1)
The Normal Distribution	193	(15)
Visual Explorations: Exploring the Normal Distribution	202	(6)
Evaluating Normality	208	(5)
Evaluating the Properties	208	(1)
Constructing the Normal Probability Plot	209	(4)
The Uniform Distribution	213	(2)
The Exponential Distribution	215	(3)
The Normal Approximation to the Binomial Distribution	218	(9)
Need for a Correction for Continuity Adjustment	218	(1)
Approximating the Binomial Distribution	218	(2)
Computing a Probability Approximation for an Individual Value	220	(1)
Summary	220	(1)
Key Formulas	221	(1)
Key Terms	221	(1)
Chapter Review Problems	221	(2)
Managing the Springville Herald	223	(1)
Web Case	224	(1)
Using Software for Continuous Probability Distributions	224	(1)
Microsoft Excel	224	(1)
Minitab	225	(2)
CD-ROM Topic: Using SPSS for a Normal Probability Plot
Sampling Distributions	227	(32)
Using Statistics: Cereal-Fill Packaging Process	228	(1)
Sampling Distributions	228	(1)
Sampling Distribution of the Mean	229	(10)
The Unbiased Property of the Sample Mean	229	(1)
Standard Error of the Mean	230	(2)
Sampling from Normally Distributed Populations	232	(3)
Sampling from Nonnormally Distributed Populations---The Central Limit Theorem	235	(2)
Visual Explorations: Exploring Sampling Distributions	237	(2)
Sampling Distribution of the Proportion	239	(3)
Types of Survey Sampling Methods	242	(6)
Simple Random Sample	243	(2)
Systematic Sample	245	(1)
Stratified Sample	246	(1)
Cluster Sample	246	(2)
Evaluating Survey Worthiness	248	(3)
Survey Errors	248	(2)
Ethical Issues	250	(1)
CD-ROM Topic: Sampling from Finite Populations	251	(8)
Summary	251	(1)
Key Formulas	251	(1)
Key Terms	252	(1)
Chapter Review Problems	252	(3)
Managing the Springville Herald	255	(1)
Web Case	255	(1)
Using Software for Sampling Distributions	256	(1)
Microsoft Excel	256	(1)
Minitab	256	(3)
Confidence Interval Estimation	259	(40)
Using Statistics: Auditing Sales Invoices at the Saxon Home Improvement Company	260	(1)
Confidence Interval Estimation for the Mean (σ Known)	261	(4)
Confidence Interval Estimation for the Mean (σ Unknown)	265	(7)
Student's t Distribution	265	(1)
Properties of the t Distribution	266	(1)
The Concept of Degrees of Freedom	267	(1)
The Confidence Interval Statement	268	(4)
Confidence Interval Estimation for the Proportion	272	(4)
Determining Sample Size	276	(6)
Sample Size Determination for the Mean	276	(2)
Sample Size Determination for the Proportion	278	(4)
Applications of Confidence Interval Estimation in Auditing	282	(6)
Estimating the Population Total Amount	282	(1)
Difference Estimation	283	(3)
One-Sided Confidence Interval Estimation of the Rate of Noncompliance with Internal Controls	286	(2)
Confidence Interval Estimation and Ethical Issues	288	(1)
CD-ROM Topic: Estimation and Sample Size Determination for Finite Populations	288	(11)
Summary	289	(1)
Key Formulas	289	(1)
Key Terms	289	(1)
Chapter Review Problems	290	(4)
Managing the Springville Herald	294	(1)
Web Case	295	(1)
Using Software for Confidence Intervals and Sample Size Determination	296	(1)
Microsoft Excel	296	(1)
Minitab	297	(2)
CD-ROM Topic: Using SPSS for Confidence Interval Estimation
Fundamentals of Hypothesis Testing: One-Sample Tests	299	(46)
Using Statistics: The Oxford Cereal Company Revisited	300	(1)
Hypothesis-Testing Methodology	300	(6)
The Null and Alternative Hypotheses	300	(2)
The Critical Value of the Test Statistic	302	(1)
Regions of Rejection and Nonrejection	302	(1)
Risks in Decision Making Using Hypothesis-Testing Methodology	303	(3)
Z Test of Hypothesis for the Mean (σ Known)	306	(8)
The Critical Value Approach to Hypothesis Testing	306	(3)
The p-Value Approach to Hypothesis Testing	309	(3)
A Connection between Confidence Interval Estimation and Hypothesis Testing	312	(2)
One-Tail Tests	314	(4)
The Critical Value Approach	314	(1)
The p-Value Approach	315	(3)
t Test of Hypothesis for the Mean (σ Unknown)	318	(7)
The Critical Value Approach	319	(2)
The p-Value Approach	321	(1)
Checking Assumptions	321	(4)
Z Test of Hypothesis for the Proportion	325	(4)
The Critical Value Approach	326	(1)
The p-Value Approach	327	(2)
The Power of a Test	329	(6)
Potential Hypothesis-Testing Pitfalls and Ethical Issues	335	(10)
Summary	338	(1)
Key Formulas	339	(1)
Key Terms	339	(1)
Chapter Review Problems	339	(3)
Managing the Springville Herald	342	(1)
Web Case	342	(1)
Using Software for One-Sample Tests of Hypothesis	343	(1)
Microsoft Excel	343	(1)
Minitab	343	(2)
CD-ROM Topic: Using SPSS for One-Sample Tests of Hypothesis
Two-Sample Tests	345	(50)
Using Statistics: Comparing Sales from End-Aisle Displays and Normal Displays	346	(1)
Comparing the Means of Two Independent Populations	346	(12)
Z Test for the Difference Between Two Means	346	(1)
Pooled-Variance t Test for the Difference Between Two Means	347	(5)
Confidence Interval Estimate for the Difference Between the Means of Two Independent Populations	352	(1)
Separate-Variance t Test for the Difference Between Two Means	352	(6)
Comparing the Means of Two Related Populations	358	(10)
Paired t Test	359	(6)
Confidence Interval Estimate for the Mean Difference	365	(3)
Comparing Two Population Proportions	368	(6)
Z Test for the Difference Between Two Proportions	368	(4)
Confidence Interval Estimate for the Difference Between Two Proportions	372	(2)
F Test for the Difference Between Two Variances	374	(21)
Finding Lower-Tail Critical Values	376	(6)
Summary	382	(1)
Key Formulas	383	(1)
Key Terms	384	(1)
Chapter Review Problems	384	(4)
Managing the Springville Herald	388	(1)
Web Case	389	(1)
Using Software for Two-Sample Tests	390	(1)
Microsoft Excel	390	(2)
Minitab	392	(3)
CD-ROM Topic: Using SPSS for Two-Sample Tests of Hypothesis
Analysis of Variance	395	(50)
Using Statistics: The Perfect Parachute Company	396	(1)
The Completely Randomized Design: One-Way Analysis of Variance	396	(15)
F Test for Differences Among More than Two Means	396	(7)
Multiple Comparisons: The Tukey-Kramer Procedure	403	(2)
Anova Assumptions	405	(1)
Levene's Test for Homogeneity of Variance	406	(5)
The Randomized Block Design	411	(10)
Tests for the Treatment and Block Effects	411	(6)
Multiple Comparisons: The Tukey Procedure	417	(4)
The Factorial Design: Two-Way Analysis of Variance	421	(24)
Testing for Factor and Interaction Effects	422	(5)
Interpreting Interaction Effects	427	(3)
Multiple Comparisons: The Tukey Procedure	430	(3)
Summary	433	(1)
Key Formulas	433	(2)
Key Terms	435	(1)
Chapter Review Problems	435	(4)
Managing the Springville Herald	439	(1)
Web Case	440	(1)
Using Software for Anova	441	(1)
Microsoft Excel	441	(1)
Minitab	442	(3)
CD-ROM Topic: Using SPSS for Anova
Chi-Square Tests and Nonparametric Tests	445	(68)
Using Statistics: Guest Satisfaction at T. C. Resort Properties	446	(1)
Chi-Square Test for the Difference Between Two Proportions (Independent Samples)	446	(8)
Chi-Square Test for Differences Among More Than Two Proportions	454	(7)
The Marascuilo Procedure	457	(4)
Chi-Square Test of Independence	461	(6)
McNemar Test for the Difference Between Two Proportions (Related Samples)	467	(3)
Chi-Square Test for a Variance or Standard Deviation	470	(4)
Chi-Square Goodness-of-Fit Tests	474	(5)
Chi-Square Goodness-of-Fit Test for a Poisson Distribution	474	(2)
Chi-Square Goodness-of-Fit Test for a Normal Distribution	476	(3)
Wilcoxon Rank Sum Test: Nonparametric Analysis for Two Independent Populations	479	(6)
Wilcoxon Signed Ranks Test: Nonparametric Analysis for Two Related Populations	485	(6)
Kruskal-Wallis Rank Test: Nonparametric Analysis for the One-Way Anova	491	(5)
Friedman Rank Test: Nonparametric Analysis for the Randomized Block Design	496	(17)
Summary	501	(1)
Key Formulas	502	(1)
Key Terms	502	(1)
Chapter Review Problems	503	(4)
Managing the Springville Herald	507	(1)
Web Case	508	(1)
Using Software for Chi-Square Tests and Nonparametric Tests	509	(1)
Microsoft Excel	509	(1)
Minitab	510	(3)
CD-ROM Topic: Using SPSS for Chi-Square Tests and Nonparametric Tests
Simple Linear Regression	513	(56)
Using Statistics: Forecasting Sales for a Clothing Store	514	(1)
Types of Regression Models	514	(2)
Determining the Simple Linear Regression Equation	516	(9)
The Least-Squares Method	517	(3)
Visual Explorations: Exploring Simple Linear Regression Coefficients	520	(1)
Predictions in Regression Analysis: Interpolation versus Extrapolation	521	(1)
Computing the Y Intercept b0 and the Slope b1	521	(4)
Measures of Variation	525	(7)
Computing the Sum of Squares	525	(3)
The Coefficient of Determination	528	(2)
Standard Error of the Estimate	530	(2)
Assumptions	532	(1)
Residual Analysis	532	(5)
Evaluating the Assumptions	532	(5)
Measuring Autocorrelation: The Durbin-Watson Statistic	537	(5)
Residual Plots to Detect Autocorrelation	537	(2)
The Durbin-Watson Statistic	539	(3)
Inferences About the Slope and Correlation Coefficient	542	(7)
t Test for the Slope	542	(2)
FTest for the Slope	544	(1)
Confidence Interval Estimate of the Slope (β1)	545	(1)
t Test for a Correlation Coefficient	546	(3)
Estimation of Mean Values and Prediction of Individual Values	549	(5)
The Confidence Interval Estimate	549	(2)
The Prediction Interval	551	(3)
Pitfalls in Regression and Ethical Issues	554	(15)
Summary	557	(1)
Key Formulas	558	(1)
Key Terms	559	(1)
Chapter Review Problems	559	(5)
Managing the Springville Herald	564	(1)
Web Case	565	(1)
Using Software for Simple Linear Regression	566	(1)
Microsoft Excel	566	(2)
Minitab	568	(1)
CD-ROM Topic: Using SPSS for Simple Linear Regression
Introduction to Multiple Regression	569	(50)
Using Statistics: Predicting OmniPower Sales	570	(1)
Developing the Multiple Regression Model	570	(6)
Interpreting the Regression Coefficients	571	(3)
Predicting the Dependent Variable Y	574	(2)
r2, Adjusted r2, and the Overall F Test	576	(4)
Coefficient of Multiple Determination	576	(1)
Test for the Significance of the Overall Multiple Regression Model	577	(3)
Residual Analysis for the Multiple Regression Model	580	(2)
Inferences Concerning the Population Regression Coefficients	582	(4)
Tests of Hypothesis	582	(2)
Confidence Interval Estimation	584	(2)
Testing Portions of the Multiple Regression Model	586	(6)
Coefficients of Partial Determination	590	(2)
Using Dummy Variables and Interaction Terms in Regression Models	592	(11)
Interactions	595	(8)
Logistic Regression	603	(16)
Summary	608	(2)
Key Formulas	610	(1)
Key Terms	610	(1)
Chapter Review Problems	611	(3)
Managing the Springville Herald	614	(1)
Web Case	614	(1)
Using Software for Multiple Regression	615	(1)
Microsoft Excel	615	(1)
Minitab	616	(3)
CD-ROM Topic: Using SPSS for Multiple Regression
Multiple Regression Model Building	619	(38)
Using Statistics: Predicting Standby Hours for Unionized Graphic Artists	620	(1)
The Quadratic Regression Model	620	(9)
Finding the Regression Coefficients and Predicting Y	621	(3)
Testing for the Significance of the Quadratic Model	624	(1)
Testing the Quadratic Effect	624	(3)
The Coefficient of Multiple Determination	627	(2)
Using Transformations in Regression Models	629	(3)
The Square-Root Transformation	629	(1)
The Log Transformation	630	(2)
Influence Analysis	632	(3)
The Hat Matrix Elements hi	633	(1)
The Studentized Deleted Residuals ti	633	(1)
Cook's Distance Statistic Di	634	(1)
Overview	634	(1)
Collinearity	635	(2)
Model Building	637	(10)
The Stepwise Regression Approach to Model Building	638	(2)
The Best-Subsets Approach to Model Building	640	(6)
Model Validation 000	646	(1)
Pitfalls in Multiple Regression and Ethical Issues	647	(10)
Pitfalls in Multiple Regression	647	(1)
Ethical Issues	648	(1)
Summary	648	(1)
Key Formulas	648	(1)
Key Terms	648	(2)
Chapter Review Problems	650	(3)
The Mountain States Potato Company Case	653	(1)
Web Case	653	(1)
Software for Multiple Regression Model Building	654	(1)
Microsoft Excel	654	(1)
Minitab	655	(2)
CD-ROM Topic: Using SPSS for Model Building
Time-Series Forecasting and Index Numbers	657	(68)
Using Statistics: Forecasting Revenues for Three Companies	658	(1)
The Importance of Business Forecasting	658	(1)
Component Factors of the Classical Multiplicative Time-Series Model	659	(2)
Smoothing the Annual Time Series	661	(6)
Moving Averages	662	(2)
Exponential Smoothing	664	(3)
Least-Squares Trend-Fitting and Forecasting	667	(12)
The Linear Trend Model	668	(2)
The Quadratic Trend Model	670	(2)
The Exponential Trend Model	672	(2)
Model Selection Using First, Second, and Percentage Differences	674	(5)
The Holt-Winters Method for Trend-Fitting and Forecasting	679	(3)
Autoregressive Modeling for Trend-Fitting and Forecasting	682	(11)
Choosing an Appropriate Forecasting Model	693	(4)
Performing a Residual Analysis	693	(1)
Measuring the Magnitude of the Residual Error through Squared or Absolute Differences	694	(1)
Principle of Parsimony	694	(1)
A Comparison of Five Forecasting Methods	694	(3)
Time-Series Forecasting of Seasonal Data	697	(7)
Least-Squares Forecasting with Monthly or Quarterly Data	698	(6)
Index Numbers	704	(8)
The Price Index	705	(1)
Aggregate Price Indexes	706	(2)
Weighted Aggregate Price Indexes	708	(1)
Some Common Price Indexes	709	(3)
Pitfalls Concerning Time-Series Forecasting	712	(13)
Summary	712	(1)
Key Formulas	713	(2)
Key Terms	715	(1)
Chapter Review Problems	715	(3)
Managing the Springville Herald	718	(1)
Web Case	718	(1)
Using Software for Time-Series Forecasting and Index Numbers	719	(1)
Microsoft Excel	719	(3)
Minitab	722	(3)
CD-ROM Topic: Using SPSS for Time-Series Forecasting
Decision Making	725	(26)
Using Statistics: Selecting A Stock	726	(1)
Payoff Tables and Decision Trees	726	(4)
Criteria for Decision Making	730	(9)
Expected Monetary Value	731	(1)
Expected Opportunity Loss	732	(2)
Return-to-Risk Ratio	734	(5)
Decision Making with Sample Information	739	(5)
Utility	744	(7)
Summary	746	(1)
Key Formulas	746	(1)
Key Terms	746	(1)
Chapter Review Problems	746	(3)
Web Case	749	(1)
Using Software for Decision Making	750	(1)
Microsoft Excel	750	(1)
Statistical Applications in Quality and Productivity Management	751	(44)
Using Statistics: Service Quality at the Beachcomber Hotel	752	(1)
Total Quality Management	752	(3)
Six Sigma Management	755	(1)
The Theory of Control Charts	755	(3)
Control Chart for the Proportion of Nonconforming Items---The p Chart	758	(6)
The Red Bead Experiment: Understanding Process Variability	764	(2)
Control Chart for an Area of Opportunity---The c Chart	766	(4)
Control Charts for the Range and the Mean	770	(7)
The R Chart	771	(2)
The X Chart	773	(4)
Process Capability	777	(18)
Customer Satisfaction and Specification Limits	777	(2)
Capability Indexes	779	(1)
CPL, CPU, and Cpk	780	(3)
Summary	783	(1)
Key Formulas	783	(1)
Key Terms	784	(1)
Chapter Review Problems	784	(3)
The Harnswell Sewing Machine Company Case	787	(2)
Managing the Springville Herald	789	(2)
Using Software for Control Charts	791	(1)
Microsoft Excel	791	(1)
Minitab	791	(4)
CD-ROM Topic: Using SPSS for Control Charts
Appendices	795	(60)
A. Review of Arithmetic, Algebra, and Logarithms	796	(2)
B. Summation Notation	798	(3)
C. Statistical Symbols and Greek Alphabet	801	(1)
D. CD-ROM Contents	802	(7)
E. Tables	809	(27)
F. Using Microsoft Excel with This Text	836	(2)
G. PHStat2 User's Guide	838	(17)
Self-Test Solutions and Answers to Selected Even-Numbered Problems	855	(38)
Index	893