MCO-03

Important Questions and Answers

1. Explain various methods of research and their applicability in the area of business
research.
Explain different methods of research relevant to Business Research.
Research is the process of systematic study of a problem and finding its solution. Systematic
research is done through collection, analysis and interpretation of the data and information
from various sources.
Research is defined as a “systematised effort to gain new knowledge”.

Methods of Research
The important methods of research are
● Survey method
● Observation method
● Case method
● Experiments
● Literature
● Existing data
Let’s define one by one all the above methods
1. Survey method survey is a process of collecting information about a large number of
people by collecting information from few of them. In this method, data is directly
collected from respondents. The investigator must be an expert and should have sound
knowledge of interview, questionnaire, etc.
2. Observation method under this method, information is gathered by viewing a particular
event. It is a scientific enquiry. Information gathered or used to conduct research. This
method is suitable to study human behaviour, lifestyles, customs and traditions etc.
3. Case method it aims at studying everything about something rather than something
about everything. It studies an event in depth and collect a lot of information about it. It
is quite suitable for medical purpose.
4. Experiment method this method helps to study the cause-and-effect relationship of an
event. It is popular in science subjects like physics, chemistry etc.
5. Literature method in this method, information is collected from books, journals,
report’s, magazines, newspapers etc. this is one of the most popular methods add is
wise widely used by common man.

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 6. Existing data under this method, information is collected from the available sources in
an organization. The previous researches conducted by the organization are studied
carefully and based on those decisions are taken.

Significance of research in business

Let’s see the importance of research in the five most important areas of business such as
production, marketing, finance, human resources and purchasing.
1) Production Research is very important in the production department of an organization. It
helps in product development, finding better ways of production, inventing new
technologies, methods of cost reduction, improving product quality, etc.
2) Marketing is regarded as one of the complex functions of a business organization.
Without proper research of the market, it is very difficult to sell a product. Market
research provides valuable information about the taste, fashion and style of the
consumers. Research also provides information about new opportunities and competitors
strengths and weaknesses. It also helps in the advertising, sales promotions, distribution
and after sales services.
3) Finance Research plays a very important role in the financial management. It provides
information about how to maintain liquidity, inflow and outflow of cash, pricing of the
product and funds management. Therefore, many financial institutions set up research
divisions specially to conduct research on economic conditions of the business and
people.
4) Human resource Research is quite helpful in the area of human resource management. It
helps in recruitment, selection, placement and training of human resource. Research
helps in job designing, job assignment, job enrichment, etc. It also helps to create an
environment where employees can grow and develop their potential and career.
5) Purchase or materials department uses research to frame suitable policies regarding
where to buy, when to buy, how much to buy and at what price to buy. Research also
helps to find the available credit limits in the market. It also helps to find the number of
suppliers with whom the business can deal.

2.Explain the various methods of collecting primary data pointing out their merits and
demerits.
Answer: The data which is collected by the researcher for the first time are called primary
data.
There are basically five methods of collecting primary data:
i) Observation method
ii) Interview method

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 iii) Reporters
iv) Questionnaire
v) Schedule
i) Observation method: In this method, a researcher collects data by observing the
activities of the interviewer. Observation is nothing but watching the behaviour of
the participants carefully. Few processes of observation are sensation, attention and
perception.
Merits
● This method is suitable for intensive study and provides raw materials for deep study.
● This method is suitable where the participants are reluctant to share information.
● This method is quite economical.
Demerits
● The observer must be an expert otherwise he cannot predict accurately.
● This method is not suitable for extensive study purpose.
● There is every chance of wrong prediction if the participant does not behave rationally.
● This method is not reliable and generally not followed by many organisations.
ii) Interview method This method of collecting data is one of the most popular and
important. An interview is the meeting of two persons wherein one person tries to
gather information from the other person by asking simple questions. There may be
direct personal interview or indirect personal interview.
Merits
● Interviews have high response rates.
● The method is quite reliable and valuable.
● This method is flexible and questions can be asked according to the facial expressions of
the candidate.
Demerits
● The interviewer must be a trained professional.
● This method is expensive and time consuming.
● It cannot be used when the field of inquiry is large.
iii) Reporters: Under this method, reporters and correspondents are appointed in
different areas to collect data and information about a particular matter. This
method is generally employed by government departments, newspapers, magazines,
radio and TV news channels.
Merits

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 ● This method is more accurate and reliable.
● This method is economical.
● Information can be collected easily and quickly.
● Information can be collected from a wide area extensively.
Demerits
● This method is expensive as many reporters had to be appointed.
● It is time consuming.
● Data may not be reliable
iv) Questionnaire under this method, a list of questions is sent to the informants
requesting them to answer. questions are sent either by post or personally or by
email.
Merits
● This method is suitable to cover a wide area.
● This method is economical.
● Reliable and concrete information may be collected through this method.
Demerits
● It is a time-consuming process.
● The informants may not answer the questions honestly.
● This method is not applicable to uneducated people.
v) Schedule is also a type of questionnaire send to the informants asking them to reply
to the questions. Generally, informants are researchers or enumerators and collect
information from the informants. Here enumerators fill the questionnaire.
Merits
● It is applicable to uneducated people also.
● It is suitable for extensive study.
● The enumerators visit the informants personally to collect information.
Demerits
● It is expensive and time-consuming method.
● The informants may not respond honestly and thus information may not be reliable.

3. What do you mean by Research Problem? Discuss various sources of research and points
to be considered while selecting research
problem.
The research cannot proceed without a problem.

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 ● Research starts by perceiving a problem.
● A problem is a type of difficulty experienced by a researcher.
● A problem exists when we do not have enough information to answer a problem.
● Any condition or circumstance in which one does not know how to act and accept as
true is known as problem.
Characteristics of Research Problem
● Purpose of research should be well defined.
● Research is relevant to the management.
● Research is interesting to the researcher.
● Researcher must have the abilities and expertise to find the solution of the problem.
● Availability of data.
● Accessibility of data.
● Availability of resources.

Sources of research problems.

The following are some sources which helps to identify the problem areas
1) Business problems.
2) Day to day problems.
3) Technological problems.
4) Unexplored areas.
5) Researchers interest.
6) Books, thesis, articles, reports.
7) Policy problems.
1. Business problems every business house experiences some types of problems in various
functional areas like production, finance, marketing, human resource, etc. Therefore,
this is one of the most important sources of research.
2. Day to day problems: A research problem can be from the day today experience of the
researcher. All these problems are related to real life problems and finding a solution of
these problems is a necessity.
3. Technological problems: Companies often faces the challenges of adopting latest
technology. As we know, this is the age of technology which is changing very fast. To
adopt a new technology sometimes becomes a problem for a firm. Therefore, a
researcher should always try to find the solution to this problem.
4. Unexplored areas: A researcher may identify the areas in which much work has been
done and the areas in which little work has been done. so, he should concentrate more
on those areas which are not explored.

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 5. Interest of the researcher: A researcher may also select a problem which matches his
interest. In such a situation, he should have sufficient knowledge and expertise to
investigate into the problem of his choice.
6. Books, theses, articles: Sometimes problems arise when we do not understand a
concept from books or articles. We often try to find the solution of these problems. The
same case may happen with a researcher.
7. Policy problems: Whenever the government makes new policies, it may have both
positive and negative effect. The areas which have negative effects are problematic
areas and a researcher must try to find the solution of these problems.

Points to be considered while selecting a problem

Every problem selected for research must satisfy the following conditions
● The topic selected should be original or less explored. Then only the researcher feels
interested to investigate into the problem and finding a solution.
● It should be useful and significant.
● It must be socially desirable.
● It should be interesting to the researchers and he should take keen interest to
investigate.
● It should match with the researcher’s specialization. This means, he should have
sufficient knowledge and expertise to solve the problem.
● It should be big enough to be researchable and small enough to be handled.
● It should have a clear focus or objective.
● The research should be completed within the time limits permissible.
● It should be cost effective.

3. Discuss the types of measurement scales used to measure attitude.

Levels of Measurements There are four different scales of measurement.

1. Nominal Scale
2. Ordinal Scale
3. Interval Scale
4. Ratio Scale

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1.Nominal Scale
● It is a very simple and widely used scale of measurement.
● It studies the relationship between 2 variables.
● A nominal scale is the 1st level of measurement scale in which the numbers serve as
“tags” or “labels” to classify or identify the objects.
● It is qualitative. The numbers are used here to identify the objects.
For example:
What is your gender?
□ Male □ Female

2.Ordinal Scale

● This scale gives rank along with categories.

● It helps to measure the degree of difference between two or more variables.
● Ordinal data is known as qualitative data or categorical data. It can be grouped, named
and also ranked.
● The ordinal scale shows the relative ranking of the variables

Example:
Mobile Phone Consumer
preference

Samsung 2

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 Real me 3

iPhone 1

3.Interval Scale
● When each rank is given an attribute, it becomes an interval scale.
● Attributes can be denoted by numbers or semantic format.
● The interval scale is the 3rd level of measurement scale.
● It is defined as a quantitative measurement scale in which the difference between the
two variables is meaningful.
● For example:
Samsung Mobile Scale
Numerical format

Display 1 2 3

Battery 1 2 3

Storage 1 2 3

Charging 1 2 3

Price 1 2 3

Semantic format

Very good Good Poor

Displa
y

Battery Very good Good Poor

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Storage Very good Good Poor

Charging Very good Good Poor

Price Very good Good Poor

4.Ratio Scale
● It has the properties of an interval scale together with a fixed zero point.
● It is quantitative in nature.
● Ratio scale has a feature of absolute zero.
● The variables can be orderly added, subtracted, multiplied, divided.
● Mean, median, and mode can be calculated using the ratio scale.
For example
What is your weight in Kgs?

● Less than 55 kgs

● 55 – 75 kgs
● 76 – 85 kgs
● 86 – 95 kgs
● More than 95 kgs

4.What do you mean by classification of data? Discuss the types of classification with an
example of each.
● Classification is a process of dividing the data into different groups or classes according
to their similarities and dissimilarities.
● The groups should be homogeneous within and heterogeneous between themselves.
● It helps to condense huge amount of data.
● Classification provides a basis for tabulation and analysis of data.

Types of classification
1.Geographical classification Data are classified with reference to geographical locations such
as countries, states, cities, districts etc. It is known as geographical classification.
2.Chronological classification Here data are grouped according to time. In such a classification
data may be classified either in ascending or descending order with reference to time such as
years, quarters, months, weeks etc.

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3.Qualitative classification Under this classification, data are classified according to some
attributes or qualities like honesty, beauty, intelligence, literacy, marital status etc.
4.Quantitative classification Under this classification, data are classified according to
measurable quantity like height, weight, age etc.

5.Explain the concept of sampling error. Explain various types of sampling errors
encountered in business research.
● A sampling error is a statistical error that occurs when an analyst does not select a
sample that represents the entire population of data.
● As a result, the results found in the sample do not represent the results that would be
obtained from the entire population.
● A sampling error is a deviation in the sampled value versus the true population value.
● Sampling errors occur because the sample is not representative of the population.
● Even all samples will have some degree of sampling error because a sample is only an
approximation of the population from which it is drawn.
Types of Sampling Errors
There are different categories of sampling errors.
Population-Specific Error A population-specific error occurs when a researcher doesn't understand whom to
survey.
Selection Error Selection error occurs when the survey is self-selected, or when only those participants who are
interested in the survey respond to the questions. Researchers can attempt to overcome selection error by finding
ways to encourage participation.
Frame Error Sample A sample frame error occurs when a sample is selected from the wrong population data.
Non-response Error A non-response error occurs when a useful response is not obtained from the surveys
because researchers were unable to contact potential respondents.

6.What do you mean by correlation and regression? How are they used to test the
hypothesis?
Correlation shows the relationship between the 2 variables while regression shows how one
variable affects the other.
Correlation
● It is a statistical measure used to determine relationship of 2 variables.
● 2 variables move together.
● No difference between the X & Y variables.
● It indicates only the nature and extent of linear relationship.
Regression

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 ● It describes how an independent variable is related to the other numerically.
● It shows the cause-and-effect relationship between the variables.
● Both X & Y variables are independent.
● It indicates the impact of independent variable on dependent variable.

Use of correlation and regression in testing hypothesis

● These are most commonly used techniques to find relationship between 2 given
variables.
● Correlation quantifies the strength of linear relationship between variables whereas
regression expresses the relationship in the form of an equation.
● For example, relationship between age and knowledge can be found by correlation
where is the level of knowledge prediction by age is a cause of regression.
● A value of correlation coefficient close to +1 shows strong positive linear relationship
and if it is -1 it shows a negative relationship.
● A value close to zero shows no relationship which is also known as null hypothesis.
● The value of correlation coefficient always lies between -1 and +1.

Correlation Regression

‘Correlation’ as the name says it determines the ‘Regression’ explains how an independent variable is
interconnection or a co-relationship between the numerically associated with the dependent variable.
variables.

In Correlation, both the independent and dependent However, in Regression, both the dependent and
values have no difference. independent variable are different.

The primary objective of Correlation is, to find out a When it comes to regression, its primary intent is, to
quantitative/numerical value expressing the reckon the values of a haphazard variable based on the
association between the values. values of the fixed variable.

Correlation stipulates the degree to which both of However, regression specifies the effect of the change in
the variables can move together. the unit, in the known variable(p) on the evaluated
variable (q).

Correlation helps to constitute the connection Regression helps in estimating a variable’s value based
between the two variables. on another given value.

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 ● Correlation is the relationship between two or more variables whereas regression shows
the nature of relationship between the variables.
● Correlation shows the joint variation of two measurements neither of which is
restricted. On the other hand, regression considers the frequency distribution of one
variable when another is fixed or independent variable.
● Correlation may or may not show the cause-and-effect relationship between the
variables whereas regression shows the cause-and-effect relationship between the
variables.
● There may be spurious correlation between two variables but regression does not show
spurious relationship between variables.
● Correlation has a narrow application as it studies only linear relationship. on the other
hand, regression has a wider application as it studies both linear and non-linear
relationships.

7.What do you understand by interpretation of data? What are the precautions to be taken
while interpreting the data?
The process of drawing conclusions or inferences after a careful analysis of the data is known
as interpretation. The researcher discloses his research findings.
Precautions
● The interpretation must be objective.
● He must understand the problem.
● He must appreciate the relevance of various elements of the problem.
● She must ensure that adequate and accurate data are collected.
● He should also ensure that the data are properly classified and analysed.
● Avoid the sources of errors as far as possible.
● Interpretation must be within the limits of data.

8.Explain the Logical Methods of Generalization.

A generalization is a statement made from the available evidence. In everyday life we often
make generalizations. For example, A is a crow and it is black. B is a crow it is also black. Then,
we can generalize that all crows are black.

Logical methods of generalization

● Method of agreement.
● Method of difference.

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 ● Joint method.
● Method of residues.
a. Method of agreement
● It may be positive or negative.
● This method states that if two or more instances of a phenomenon have one
circumstance in common, the circumstance is the cause or the effect of the given
phenomenon.
● For example, if a person feels pain in his eyes in the sun, negatively he does not feel pain
when he is in shade. Therefore, we can generalise that the cause of the pain is roaming
in the sun.
b. Method of difference
● This method is a combination of both positive and negative methods of agreement.
● Who instances that resemble each other in every other respect but differ in the absence
or presence of the phenomena observed?
● For example, a man is shot, he’s wounded and dies. Hear the wound is the cause of that.
c. Joint method
● This method is a combination of both the method of agreement and the method of
difference.
● According to this method, we require 2 sets of instances.
d. Method of residues
● This method is based on the principle of elimination.
● We just need to subtract from any phenomena search part as is known by previous
inductions to be the effect of certain antecedents and the residue of the phenomena is
the effect of the remaining incidents.
● For example, a loaded lorry weighs 11 tons. The weight of the lorry is 1 ton. Therefore,
the weight of the load is (11 – 1) = 10 ton.

9. What do you mean by research design? Discuss the functions and components of research
design.

● The research design is the logical and systematic planning and directing of a piece of
research.
● It is a plan or strategy of investigation so as to find the solution of a problem.
● The strategy includes the methods to be used to collect and analyse the data.
● A research design basically is a plan of action.

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Functions of research design
● To provide a plan of action to the researcher.
● To provide the boundaries of research activity.
● To identify the potential problems in the research.
● To provide answers to various kinds of research related questions to the investigator.

Components or contents of Research design

● Defining the problem: Every research starts with a problem. The object of research is to
find solution of a problem. Therefore, it is important to understand the problem and its
relative importance.
● Objective of research: The next component is to find the goal of the research. Though,
object of a research is to find solution. It is very important for a researcher to achieve the
aim of the research.
● Planning the research: A good researcher always plans his research. He makes the design of
the research as the director of a movie does before the shooting.
● Formulation of Hypothesis: The next step is to find possible solutions to the problem. Then,
put them into hypothesis tests for testing.
● Sources of data: In this stage, the data are collected from various sources. Basically, there
are two sources such as primary source and secondary source.
● Method of collection: There are different methods of collecting data such as survey,
interview, questionnaire, pause reference, etc. a researcher has to use the best method
according to the time and condition.
● Analysis of data: The next important stage is analysing the data. the most relevant data are
selected for interpretation.
● Presentation of the results: Here, a researcher presents his results of study in a form of
research report.
● Time estimates: A researcher has to keep the time limits required for making research. It
must be completed within the stipulated period of time.
● Cost of research: A researcher must also consider the expenses involved in conducting
research. it depends on the budget of the organization and the area of research to be
conducted.

10. Discuss the various methods of sampling. Which methods are more suitable for market
research?

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Sampling is a process of collecting data from the samples chosen. Generally, it is not possible
for a researcher to collect data from each member or unit of a population. Therefore, it divides
the whole population into small samples from where data are collected.

Methods of sampling
The various sampling methods can be classified into two categories:
A. Random sampling methods.
B. Non-random sampling methods.

A. Random sampling methods

● This method is also known as probability sampling.
● All units in the population have a chance of being chosen in the sample.
● It is the simplest sampling methods and each element of the population is involved in
sampling.
● Random sampling methods are again divided into 5 methods
● Simple random sampling.
● Systematic sampling.
● Stratified random sampling.
● Cluster sampling.
● Multi stage sampling
I. Simple random sampling
● It is the most popular method for choosing a sample among population for a wide
range of purposes.
● In simple random sampling each member of population is equally likely to be chosen
as part of the sample.
● Any member of the population is given an equal chance to be chosen.
● Each unit is selected randomly.
● It can be argued that this method is easy to understand in theory, but difficult to
perform in practice. This is because working with a large sample size is not easy and it
can be a challenge to get a realistic sampling frame.

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Advantages of Simple Random Sampling

1. If applied appropriately, simple random sampling is associated with the minimum

amount of sampling bias compared to other sampling methods.
2. Given the large sample frame is available, the ease of forming the sample group i.e.,
selecting samples is one of the main advantages of this method.
3. Research findings can be generalized due to representativeness of this sampling
technique and a little relevance of bias.
4. It is straightforward sampling method that requires no advanced technical knowledge.

Disadvantages of Simple Random Sampling

1. This can be costly and time-consuming for large studies.

2. The necessity to have a large sample size can be a major disadvantage in practical levels.
3. This sampling method is not suitable for studies that involve face-to-face interviews
covering a large geographical area due to cost and time considerations.

II. Systematic sampling

● It involves choosing a first individual at random from the population, then selecting
every following nth individual within the sampling frame to make up the sample.
● It follows a certain pattern in sampling.

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Advantage
● faster and simpler way, since there is no need to generate a random number for each
individual in the sample.
● systematic sampling guarantees perfectly even selection from the population.

III. Stratified random sampling

● In stratified sampling, we divide the population into relatively homogeneous groups
called strata.
● Then we select a sample from each strata using simple random sampling method.
● This method is used when the population is heterogeneous rather than homogeneous.
● a heterogeneous population is composed of different elements such as male female,
rural urban, literate illiterate, etc.
● This method can be of two types such as proportional stratified sample and
disproportional stratified sample.
● If the number of sampling units drawn from each stratum is in proportion it is known as
proportional stratified sample.
● If number of sampling units drawn from each stratum is not in proportion, then it is
known as disproportional stratified sample.

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Advantages
● This method is more accurate as it reflects the characteristics of the population.
● This method is more precise.
● It saves a lot of time, money and resources for data collection because sample size is
small.
Disadvantages
● This method requires a detailed knowledge of the characteristic of the population.
● It is a difficult task to prepare a stratified list.
IV. Cluster Sampling Cluster sampling (also known as one-stage cluster sampling) is a
technique in which clusters of participants representing the population are identified
and included in the sample. This is a popular method in conducting marketing
researches.
Cluster sampling process can be single stage or multistage. In single stage sampling, all
members of selected clusters are included in the study, whereas in multistage sampling
additional sampling methods are used to choose certain individuals within selected clusters.

The whole population is divided into clusters such as districts, towns, cities, etc. then a person
is selected randomly.

Advantages of Cluster Sampling

1. It is the most time-efficient and cost-efficient probability design for large geographical
areas
2. This method is easy to be used practically.
3. Larger sample size can be used.

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Disadvantages of Cluster Sampling

1. Requires group-level information to be known

2. Commonly has higher sampling error than other sampling techniques.
3. Cluster sampling may fail to reflect the diversity in the sampling frame

V. Multi-stage sampling It is a combination of all the above methods of sampling.

Sampling is done in various stages. The whole population is divided into clusters and
each cluster into groups and subgroups. Then each unit is selected randomly.
Advantages
● It is less expensive.
● It is more flexible as it allows different sampling procedures at different stages.
● It can be used over a wide area.

B. Non-random sampling methods

In non-random sampling method, the probability of any particular units of the population
being chosen is unknown. The various non random sampling methods are:
1. Convenience sampling as the name implies, this method refers to obtaining a sample
that is most conveniently available to the researchers. Convenience samples are best
used for exploration research. It is useful in testing the questionnaires designed on a
pilot basis. it is widely used in market research.
2. Judgement sampling in this method of sampling the selection of sample is based on
researchers’ judgment about a sample. This type of sampling is often used to measure
the performance of salespersons. It is also used to forecast election results.
3. Quota sampling this type of method is quite popular in marketing research. The samples
are collected on the basis of some parameters like age, sex, geographical region,
education, income, occupation, etc. The researchers are then assigned fixed quotas of
the sample.

11. Distinguish between Census vs Sampling

Census and sampling are two methods of collecting survey data about the population that are used by many
countries.
Census refers to the quantitative research method, in which all the members of the population are enumerated.
On the other hand, the sampling is the widely used method, in statistical testing, wherein a data set is selected
from the large population, which represents the entire group.

Census Sampling

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 A systematic method that collects and Sampling refers to a portion of the population
records the data about the members of selected to represent the entire group, in all
the population is called Census. its characteristics.

Each and every unit of the population is

Only a handful of units of the population.
covered.

It is a time-consuming process. It is a fast process.

Expensive method Economical method

Less reliable and accurate, due to the margin

Reliable and accurate
of error in the data collected.

Population of heterogeneous nature. Population of homogeneous nature.

12. What do you mean by research design? Discuss the functions and components of
research design.
● The research design is the logical and systematic planning and directing of a piece of
research.
● Research designs are plans that specify how data should be collected and analysed.
● It is a plan or strategy of investigation so as to find the solution of a problem.
● The strategy includes the methods to be used to collect and analyse the data.
● A research design basically is a plan of action.

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Functions of research design
● To provide a plan of action to the researcher.
● To provide the boundaries of research activity.
● To identify the potential problems in the research.
● To provide answers to various kinds of research related questions to the investigator.

Components or contents of Research design

● Defining the problem: Every research starts with a problem. The object of research is to
find solution of a problem. Therefore, it is important to understand the problem and its
relative importance.
● Objective of research: The next component is to find the goal of the research. Though,
object of a research is to find solution. It is very important for a researcher to achieve the
aim of the research.
● Planning the research: A good researcher always plans his research. He makes the design of
the research as the director of a movie does before the shooting.
● Formulation of Hypothesis: The next step is to find possible solutions to the problem. Then,
put them into hypothesis tests for testing.
● Sources of data: In this stage, the data are collected from various sources. Basically, there
are two sources such as primary source and secondary source.
● Method of collection: There are different methods of collecting data such as survey,
interview, questionnaire, pause reference, etc. a researcher has to use the best method
according to the time and condition.
● Analysis of data: The next important stage is analysing the data. the most relevant data are
selected for interpretation.
● Presentation of the results: Here, a researcher presents his results of study in a form of
research report.
● Time estimates: A researcher has to keep the time limits required for making research. It
must be completed within the stipulated period of time.
● Cost of research: A researcher must also consider the expenses involved in conducting
research. it depends on the budget of the organization and the area of research to be
conducted.

13. Write a short note on Time Series. A time series can be taken on any variable that changes over time. In
investing, it is common to use a time series to track the price of a security over time. This can be tracked over the short
term, such as the price of a security on the hour over the course of a business day, or the long term, such as the price of a
security at close on the last day of every month over the course of five years.

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Time series analysis can be useful to see how a given asset, security, or economic variable changes over time. It can also
be used to examine how the changes associated with the chosen data point compare to shifts in other variables over the
same time period.

Time series has 4 main components such as

Trend variation -T
Seasonal variation- S
Cyclic variation- C
Irregular variation- I
Additive model in this model the 4 components of time series are added. they are
independent of each other.
Y=T+S+C+I
Multiplicative model in this model the 4 components of time series are multiplied. they are
interdependent on each other.
Y=T×S×C×I
Time series is also used in several non-financial contexts, such as measuring the change in population over time.
The figure below depicts such a time series for the growth of the U.S. population over the century from 1900-
2000.

14. Write a short note on Skewness.

1. Skewness, in statistics, is the degree of asymmetry observed in a probability distribution.

2. Distributions can exhibit right (positive) skewness or left (negative) skewness to varying
degrees. A normal distribution (bell curve) exhibits zero skewness.
3. Skewness informs users of the direction of outliers, though it does not tell users the
number of outliers.

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 4. Negative skew refers to a longer or fatter tail on the left side of the distribution, while
positive skew refers to a longer or fatter tail on the right.

Zero skew occurs when a data graph is symmetrical.

● It is clear from the first figure that the data are symmetrical when they spread equally
on both sides from the middle point. Here, the value of mean, median and mode are the
same.

Mean = Median = Mode

● From the second figure, it is clear that the frequency Polygon is not sloped evenly in
both sides. Its tail is longer on the right side. That means it is positively skewed. Here
Mean > Median > Mode
● In the 3rd figure, there is a longer tail towards the left-hand side which shows that it is
negatively skewed.
Mean < Median < Mode
Thus, when the distribution is asymmetrical, it is either positively skewed or negatively
skewed.

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15. What is reporting? What are the different stages in the preparation of a report?
Reporting is the means of communication where information is shared through reports. Thus,
reporting is communicating the facts, data and information through reports to the person for
whom such facts and data are collected and compiled. report is an account describing the
procedure adopted, the findings arrived at and the conclusions drawn by the investigator of a
problem.
Characteristics of a good report
● Accurate the research report should be accurate and relevant to the problem. it should
not contain any unnecessary data.
● Simplicity the research report should be simple to understand. The language and the
presentation of the report should be such that the reader can easily understand the
contents of the report.
● Reliability a research report should be reliable and trustworthy. All the data and
information provided in the research report should be accurate and relevant to the
management.
● Economical a research report should be economical add less expensive. a researcher
should take all possible steps to minimise the cost of research.
● Timeliness a research report should be completed within the time. It should be made
available when the management needs it the most. Therefore, a researcher should
finalize the report within the time frame given to him.
● Completeness a research report should be complete in all respects. there should not be
any loopholes or mistakes in the research report. it must be relevant and answer the
question and problem.

Stages in the preparation of a report

● Identifying the problem, the first stage is to identify the problem for which the solution
has to be devised. It is very important to define the problem properly because all the
research work depends on finding the solution of the problem.
● Setting objectives and hypothesis the second stage this to set goals or targets for the
research. it refers to finding the solution of the problem. solution should be the main
objective of the research. before conducting research, it is always advisable to prepare a
hypothesis.
● Collecting data this is one of the most important stages in preparing a research report.
Data and information should be collected from reliable sources. Sufficient and adequate
data must be collected for good research.

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 ● Processing and analysing data once all the data are collected, they must be processed
and analysed carefully. then the relevant data must be selected for further analysis.
● Writing the final report after the analysis of data, this is time to prepare the final report
of the research. it must contain the solution of the problem for which the research has
been conducted. the report must be presented in writing without any grammatical
mistakes.

16. Distinguish between simple bar diagram and multiple bar diagram.
● Simple bar diagram is constructed either horizontally or vertically. Where else multiple
bar diagram has two or more bars.
● Comparative study cannot be made with the help of simple bar diagram whereas
comparative study can be done with the help of multiple bar diagram.
● In simple bar diagram data related to one variable are recorded. on the other hand, in
multiple bar diagram data related to two or more variables are recorded.
● Simple bar diagram is also known as deviation bar diagram whereas multiple bar
diagram is also known as cluster or compound bar diagram.
● In simple bar diagram bars are coloured with a single colour whereas in multiple bar
diagrams bars are coloured with different colours to make comparison easier.

17. Distinguish between estimation and testing of hypothesis

● Estimation deals with estimating the unknown parameter of population based on
random samples collected. on the other hand, testing of hypothesis is the process of
either rejecting or accepting a statement that has been set up about the parameter.
● In estimation it is assumed that the parameter to be estimated is constant where as in
testing of hypothesis this is done by computing a test based on the samples.
● estimation maybe of different types like point estimation, interval estimation, etc. on
the other hand testing of hypothesis may be null, simple, composite hypothesis.
● We estimate a parameter with the help of single value known as point estimate or a pair
of values known as interval estimate. on the other hand, testing of hypothesis, we may
commit to errors like Type-I or Type-II when a true statement is rejected it is Type-I error
and when a false statement is accepted it is Type-II error

18. Stages of the Business Research process

● selection of research problem.

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 ● Literature review.
● Making hypothesis.
● Preparing research design.
● Sampling.
● Data collection.
● Data analysis.
● Testing hypothesis.
● Interpretation.
● Final report.

19. Write a short note on requisites of a good statistical table.

● Table number.
● Title of the table.
● Captions or headings of the column.
● Body of the table.
● Headnote.
● Footnote.
● Source note.

20. Write a short note on uses of index numbers.

● Index number is a technique of measuring changes in a variable or group of variables
with respect to time, geographical location or other characteristics.
● And index number may be defined as a spatial average comparison of the level of
magnitude of a group of related variables.
● They help to compare one variable with another variable.
Uses of index numbers
● These numbers are used to compare the different types of data.
● Based on the analysis of data decisions are taken by the management.
● Index numbers are useful to the government in framing policies regarding taxation,
economic policies, wages and salaries policies, customs and tariffs policies,
● Index numbers can be used to compare cost of living across different cities or regions.
● Index numbers are quite often used in stock market indices.
● There are mainly 3 types of index numbers such as price indices, quantity indices and
value indices.

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 ● Price indices are related to the prices of the product whereas quantity indices relate to
the quantity consumed add value indices is a combination of both price and quantity
indices.
● They provide data for comparison of variables.
● They help to measure relative change.
● They are economic barometers.
● They compare standard of living.
● They help to frame policies.

21. What is Chi-square test? Explain the significance in statistical analysis of any research
problem.
● Chi-square test is a measure of the difference between the observed and expected
frequencies in one or more categories of variables.
● It was developed by Pearson.
● A chi-square test is a statistical test used to compare observed results with expected
results.
● Chi-square test is a statistical method used to determine goodness of fit. Goodness of fit
refers to how close the observed data r to predict data from hypothesis.
● The purpose of this test is to determine if a difference between observed data and
expected data is due to chance, or if it is due to a relationship between the variables you
are studying.
● Therefore, a chi-square test is an excellent choice to help us better understand and
interpret the relationship between our two categorical variables.
● It tells us whether two variables are independent of each other.
● It is used to assess 3 types of comparisons such as
1. goodness of fit.
2. Homogeneity.
3. Independence of variables.

Conditions and limitations

● Data must be quantitative.
● Data should be collected randomly.
● Variables must be independent of each other.
● Frequency must be above 5.
● This test is used for drawing inference only.

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22. What is cluster analysis? explain the difference between hierarchical clustering and non-
hierarchical clustering.
Cluster analysis is a statistical tool used to group similar objects into respective categories. for
example, to identify consumers who are similar to each other.

Hierarchical Non hierarchical

clusters are created in a definite order It does not follow any systematic orders.

it is less reliable it is more reliable.

It is easy to read and understand. these are complex.

23. What are measures of central tendency? Explain them briefly by bringing out their
advantages and disadvantages.
A central tendency is a typical or central value of a probability distribution. these are also
known as averages. there are 3 types of measures of central tendency such as
1. Mean, 2. Median, 3. Mode.
Advantages of Mean
● Easy and simple to understand and calculate.
● Not affected by fluctuations.
● It takes into account all the values in the series.
Disadvantages of Mean
● It is affected by very high or very low scores.
● In the absence of a single item, its value becomes inaccurate.
● It cannot be determined by inspection.

Advantages of Median
● Easy and simple to calculate and understand.
● Not affected by extreme values.
● It can be represented graphically.
● Suitable for open end distribution.
Disadvantages of Median
● Not suitable for even distribution.
● Unsuitable for algebraic treatment.
● Unsuitable for fractions and percentages.

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Advantages of Mode
● Easy to understand and calculate.
● Not affected by extreme values.
● It can represent qualitative data.
● It can be represented graphically.
Disadvantages of Mode
● Mode is not well defined.
● It does not take into account all the items in the series.
● No further treatment.

24. Explain the criteria for good research.

● Research should be purposeful. It should have a definite goal.
● There should be clear cut procedures to conduct research.
● Every research should have a well-planned resource design.
● Sufficient data should be collected for analysis.
● Research should be systematic and should follow specific steps.
● Every research should have a logic behind its conclusions.
● The research should be repeated and flexible.
● It should be easily understandable.
● Research should be less expensive.
● Research should be completed within the stipulated time.

25. Short note on tabulation of data

● It refers to systematic and logical presentation of data in rows and columns which helps
in comparison and analysis.
● It helps to understand the complex data.
● It also helps to find mistakes.
● It condenses the data into simplest form.
● It brings out essential features of data.
● It may be complex, double or simple tabulation.
● It saves time, money and space.

26. 15,000 students appeared for an exam. The main marks were 49 and standard deviation
of Marx was 6. what proportion of students scored more than 55 marks?
Z = X – Mean / SD

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Z = 55 – 49 / 6
Z=1
For Z = 1, Area = 0.3413
Proportion of students = 0.5 – 0.3413 = 0.1587 = 15.87%

27. What are the different types of diagrams used in presentation of data? explain them
briefly with suitable examples.
The different types of diagrams used in presentation of data
1. line diagrams Here we use line to connect the points of various data in the graph by
taking 2 variables.
2. Bar diagrams the data is presented by rectangular bars. All these bars should have equal
width.
3. Histograms these are like bar diagrams but no gaps are drawn between the bars.
4. Pie diagrams data is represented using circles and spheres. The circle is divided into
parts on the basis of angles or percentage.
5. Pictographs here data is represented graphically by using images or symbols.

28. Draft a suitable questionnaire for studying passengers’ satisfaction on services of

railways.
1. Gender: □ Male □ female
2. Age group: < 20 / 21 – 30 / 31 – 40 / 41 – 50 / 51 - 60
3. How often you travel by train? daily / weekly / monthly / yearly
4. Class: general / SL / 3A / 1A
5. Rate our stations: very good / good / poor
6. Cleanliness: very good / good / poor
7. Refreshment facilities: very good / good / poor
8. Toilet facilities: very good / good / poor
9. Waiting room: very good / good / poor
10.Ticketing process: very good / good / poor
11.Attitude of staff: very good / good / poor
12.How would you rate our trains? very good / good / poor
13.On board information: very good / good / poor
14.Please tell us how can we improve?

29. Explain the importance of diagrammatic and graphical representation of data in

research.

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 ● Comparative analysis diagrammatic and graphic presentation helps in comparing
different years data. It helps management to take good decisions. like for example when
we prepare for the exams, we should always analyse the past question papers.
● Helps and decision making the management can take right decisions after analysing Z
data of the previous years. Diagrammatic and graphical daughters quickly help to
compare information.
● Easy to understand diagrams and graphs are comparatively easy to understand and
learn. We can easily understand the information provided in very less time.
● Attractive diagrammatic and graphical presentation are more attractive to viewers. It
enhances the reader’s attention and he takes interest in studying the information
provided.
● Less time and cost diagrams and graphs usually take less time to prepare rather than
writing theories. These are also less expensive because they consume less stationeries
and paper.
● Less errors diagrams and graphs have less chances of errors and mistakes. They are
prepared on graph papers or chart papers which are already scaled for easy plotting of
the information
● Useful for illiterates’ diagrams and graphical presentation can be understood by both
educated and uneducated people. So, these have a wide applicability. Diagrams and
figures can be perceived by illiterates.

31. What is the need for formulating hypothesis in research? Explain the procedure of
formulating hypothesis.
The word hypothesis consists of two words – Hypo+Thesis. ‘Hypo’ means tentative or subject
to the verification. ‘Thesis’ means statement about solution of the problem. Thus, the literal
meaning of the term hypothesis is a tentative statement about the solution of the problem.
Hypothesis offers a solution of the problem that is to be verified empirically and based on
some rationale.

Hypothesis makes a research activity to the point and destination, Research without
hypothesis is like a sailor in the sea without compass.

Need for hypothesis

● Development of Research Techniques There are various types of social problems which
are complex in nature. For this research is very difficult. We cannot cover it with a single

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 technique but it requires many techniques. These techniques are due to hypothesis
provided to a researcher.
● Separating Relevant from Irrelevant Observation A Researcher during study will take
the observations and facts which are accordance to the condition and situation. While
drop out the irrelevant facts from his study. This separation is due to hypothesis
formulation which keeps away relevant observation from irrelevant.
● Direction of Research Hypothesis acts as a guide master in research. It gives new
knowledge and direction to a researcher. It directs a scientist to know about the
problematic situation and its causes.
● Acts as a Guide Hypothesis gives new ways and direction to a researcher. It acts as a
guide and a leader in various organizations or society. It is like the investigator’s eye.
● Prevents Blind Research Hypothesis provides lighting to the darkness of research. It
gives difference b/w scientific and unscientific, false and true research. It prevents blind
research and give accuracy.
● Accuracy & Precision Hypothesis provides accuracy and precision to a research activity.
Accuracy and precision are the feature of scientific investigation which is possible due to
hypothesis.
● Provide answer for a Question A hypothesis highlights the causes of a problematic
situation. Further solution is also given by a hypothesis which provides answer to a
question.
● Save Time, Money & Energy Hypothesis save time, money and energy of a researcher
because it is a guide for him and help him in saving these basic things.
● Proper Data Collection Hypothesis provides the basis of proper Data Collection
Relevant and correct information collected by a researcher is the main function of a
good formulated hypothesis.
Procedure of formulating hypothesis
● It must be testable.
● It must have an object.
● Variables must be measurable.
● It must relate 2 variables.
32. Short note on Random variables.

● A random variable is a variable whose value is unknown or a function that assigns values
to each of an experiment's outcomes.
● A random variable can be either discrete (having specific values) or continuous (any
value in a continuous range).

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 ● The use of random variables is most common in probability and statistics,
● Risk analysts use random variables to estimate the probability of an adverse event
occurring.
● A random variable can be either discrete or continuous.
● Discrete random variables take on a countable number of distinct values.
● Continuous random variables can represent any value within a specified range or
interval and can take on an infinite number of possible values.
● A typical example of a random variable is the outcome of a coin toss.

33. Short note on Normal distribution

● Normal distribution is symmetric about mean.
● The data near mean are more frequent.
● It looks like a bell and therefore is also known as bell curve.

1. It has a symmetric shape, meaning it can be cut into two halves.

2. Kurtosis = 3. Remember that kurtosis is a measure of flatness and excess kurtosis is
measured relative to 3, the “normal kurtosis.”
3. The mean, mode, and median are all equal and lie directly in the middle of the
distribution.
4. The standard deviation measures the distance from the mean to the point of inflection,
which is the point where the curve changes an “upside-down-bowl” shape to a “right-
side-up-bowl” shape.

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