Notes - QM
Notes - QM
5
6
9
10
11
12
13
14
15
1. Categorical Data
a. Nominal - Gender (Male/Female)
b. Ordinal - Order or rank of a Data is meaning full. (Fresher/Sophomre/Junior/ Senior
2. Quantitative Data.
a. Interval scale: Interval data need not have a meaningful ZERO (NIL). (Eg. Temperature at zero degree does not m
temperature exist)
b. Ratio Scale: Data has a meaningful Zero(NIL).
Percentiles - Lp = (p/100)(n+1)
Measures of Variability
20% 18%
14%
12%
9%
3% Median
Median
Mean Mean
Chebyshev's Theorem
Covarience (Excel Function COVAR)
M ⋂ C_c = 0.34
0.52
Independent Events
Bayes Theorem
Distribution
Discreate
Meaning Discreate Values such as 1,2,3,4…....infinite
Illustration
30
42
100
53
23
45
21
mu
54.82
Variance (σ2)
STD Dev
X^2 (X-mu)^2F(X)
0.2 900 123.20648
0.1 1764 16.43524
0.3 10000 612.36972
0.05 2809 0.165620000000001
0.15 529 151.87686
0.18 2025 17.357832
0.02 441 22.875848
(E(X))^2 E(X^2)
3005.2324 3949.52 944.2876
944.287599999999
30.7292629264029
Distribution Properties Type
Normal Continous
A random variable having a normal distribution with a mean of O and
a standard deviation of 1 is said to have a standard normal
probability distribution. Any normal distribution can be converted in
a z-normal dist.
Z Normal Continous
Uniform
continous Continous
function
Function Illustration
Binom.Dist (x,trial,probability,cumilative)
Norm.S.Dist(Z score,flag)
Norm.inv(probability,mean,std dev)
Norm.s.inv(probability)
Poisson.dist(x,mean,flag)
EXPON.DIST(x,1/r or u, flag)
x = desired time between event
r = units of time/per event
flag = 0 is false (absolute)
1 is True (Cumilative)
Mean or Expected
Skewness Variance Std. Deviation
Value
Given μ is also
Skewness is zero same as median sigma 𝞂
and mode
Skewness is zero Given μ = 0 sigma 𝞂= 1
μ = 𝞂^2
mean = number of
mostly Right Skewed
events/unit of
time(or space)
Right Skewed, skewness = 2 r = 1/μ
NA (a+b)/2 (b-a)^2/12
1 STD Error
2 Z Score
3 Interval Estimation
4 𝞼 Unknown
5 Proportions
Interval Estimation
6
of Proportion
7 Hypothesis Test
Hypothesis
8
Formulation
Critical Value
9
Approach
10 P Value Approach
Errors in Hypothesis
11
Testing
Hypothesis Testing
12
with two Samples
Independent
Measure Design
𝞼 known
Type 1 Error An innocent is being convicted. (Null hypothesis is rejected when it is correct)
Type 2 Error - A guilty is free (Null hypothesis is failed to reject when it is false)
Opportunity Risk (Type 2 Error) vs Investment risk (Type 1 Error)
1. Independent Measures - Data from two completely separate samples. (Between Subjects)
2. Repeated Measures - Data from same samples (within Subject)
Forward Bayes Theorem
A1 It Rained D Predicted Rain
A2 It did not rained Dc Predicted not rain
Margin of Error
p_Bar 0.5
p 0.44
STD Error 0.0221991
Z score 2.70281239
Probability 0.99656222
Sigma Known
Lower Tail Hypothesis Upper Tail
Ho mu>=100 Ho mu<=100
Ha mu<100 Ha mu>100
mu 100 mu 100
sigma 2 sigma 2
X_bar 99.75 X_bar 99.75
n 50 n 50
Alpha 0.1 Alpha 0.1
Conclusion Fail to reject Null Hypothesis Conclusion Fail to reject Null Hypothesis
ok
Sigma Unknown
Lower Tail Hypothesis Upper Tail
Ho mu>=100 Ho mu<=100
Ha mu<100 Ha mu>100
mu 100 mu 100
s 2 sigma 2
X_bar 99.75 X_bar 99.75
n 50 n 50
Alpha 0.1 Alpha 0.1
Conclusion Fail to reject Null Hypothesis Conclusion Fail to reject Null Hypothesis
ok
Situation
N>100 Use Z test
Repeated
Measures (2 t-Test: Paired Two Sample for Means
samples)
2 WAY
CHI SQUARE
SLR
X Y SSE
IV DV SUM OF SQUARED RESIDUALS
Y_cap B1X+Bo
b (x x)(y y)
i i
b0 y b1x
1
(x x ) i
2
0.05
0.00 P(A1) 0.05 TRUE
0.19 P(A2) 0.95
0.76
Output
Sigma UnKnown
n is more than 5% of N
s 32
n 30
N 500
Alpha 0.05
T_alpha/2 2.04522964
STD Error 5.6700646
avg 4.3
MOE 11.5965842
UL 15.8965842
LL -7.2965842
on proportion (p) is unknown
n is more than 5% of N
p 0.32
n 30
N 500
Alpha 0.05
Z_alpha/2 1.95996398
STD Error 0.08265468
MOE 0.16200021
Test TRUE
2 Tail Proportion
Ho mu=100 Ho p>=0.6
Ha mu≠100 Ha p<0.6
mu 100 p 0.6
sigma 2 sigma
X_bar 99.75 P_bar 0.55
n 50 n 60
Alpha 0.1 Alpha 0.02
Z critical Upp 1.28155157
Z critical Low -1.28155157 Z critical -2.05374891
Std Dev 0.28284271 Std Dev 0.06324555
T_STAT -0.88388348
ll Hypothesis Conclusion
DEPENDENT MEASURE
PEATED MEASURE
DIFF WITHIN
15 3
20 7
28 5
AVG 5
STDEV 2
ST ERROR 1.15470054
T STAT 4.33012702
T Critical 2.91998558
60 2.37288136
-2.85714286 -19.3220339
57.1428571 -16.9491525
15 7.375
EPSI 22.375 NEED CONSULTANT DATA
17.375
EPWSI 10
EVSI 12.375
ll Hypothesis
1.1 0.46913416
15.9569838
1.2 0.77483026
8.2447327
2 0.74960543
3 Probability 0.99691505
Mean 41
STd Dev 8
n 30
Std Error 1.46059349
Interval Estimate
2 sigma 4500
Alpha 0.05
MOE less than 500
311.158164
MOE at 311 500.127126
MOE at 312 499.324997
3N 800
n 50 FALSE
sigma 8
X_Bar 34.3
Z_alpha/2 2.32634787
MOE 2.54998065
Lower 31.7500193
Upper 36.8499807
𝞼 unkown
X_bar 750
s 55
n 16
N Large
Alpha 0.05
T_Alpha/2 2.13144955
STD Error 13.75
Proportions
STD Error
Hypothesis
Ho mu=80
Ha mu≠80
sigma 2
mu 80
n 25
alpha 0.05
alpha/2 0.025
x_bar 81.2
Z critical -1.95996398 1.95996398
Z stat 3
79.2160144
80.7839856
p value 0.9986501
Ho mu=1000
Ha mu≠1000
Ho mu>=1000
Ha mu<1000
Ho mu>=100
Ha mu<100
mu 100
sigma 2
X_bar 99.75
n 50
Alpha 0.05
Z critical -1.64485363
Std Dev 0.28284271
Z_Stat -0.88388348
Ho mu=25 sigma_pbar
sd 45.784 Ha mu≠25
x_bar 31.194 mu 25 Z score
s 2.1933
X_bar 25.51 0.01267366
n 20
Alpha 0.05
T critical Upp 0.35404095
Z critical Low 2.09302405
Std Dev 0.49043679
T_STAT 1.03988936
Americans
milk 0.17
Ho p<=0.17
Ha p>0.17
p 0.5
n 120
p_bar 0.55833333
STD Error 0.04564355
Z stat 1.2780193 0.89937869
Z critical 1.64485363
Conclusion Reject
Do 0
Z stat -0.31364627
Z critical -1.95996398
IV GEIO LOCATION
DV APPLICATION FEE
IV DEMOGRAPHICS INNER SUB
DV SALES VOLUMMON S1
S2
IV S3
DV S4
0.6
0.5
120
0.04472136
-2.23606798
Z critical 2.05374891
Std Dev 0.00281366
Z_Stat 2.07322107
P(Profess/Female) 0.23647125
n 500
p_bar 0.23 P(F union P) 0.5548
P 0.17
np 85 Yes P(A intersection B) P(B)
Null p<=0.17
Alternate p>0.17
Sigma_pbar 0.01679881
Z statistic 3.57168168
Z_Critical 1.64485363
Reject the hypothesis
Cost of BS 300
Sell of BS 650
Salvage 100
Q
1 How many bestsellers they order weekly basis?
What would be average weekly net earning for 49 weeks?
Editing this shape or saving this workbook into a different file format will
permanently break the chart.
100 35000
150 49040.8511
200 56217.234
250 56144.539
300 48489.6454
500
1.96
Considerations
1 Chance
Normal Distrubution
52.7929224 =NORM.INV(RAND(),60,15)
39.498782
80.5236822
50.6383377
74.8142133
51.1006654
43.8202831
72.8266721
70.4117841
39.188812
71.3464278
65.9664239
53.0679177
70.1862002
68.4933949
39.7618339
97.4304637
76.4089113
59.7335994
42.2959112
74.5799019
71.6243074
37.9631079
56.0853716
44.700388
41.1940351
53.4050593
73.8076967
44.9419055
15.3375782
51.9691099
65.0085545
63.7124567
54.2747271
65.2525362
55.282453
67.6463474
68.0082867
69.0604943
60.8978169
66.7777592
32.2341154
56.8356945
94.6681532
79.6087364
55.1344897
66.8239092
77.4464528
47.678378
69.147556
80.627215
73.1563226
62.6708397
66.3155743
61.9960385
56.1249671
55.5817463
46.8248493
53.6565143
73.4204458
80.0009171
78.7150941
78.4570701
81.1964351
54.6270962
68.0123478
67.943047
79.9727617
61.7859636
56.4756811
52.5315201
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46.407147
81.3936117
86.8417502
45.4482405
50.5488404
74.9625297
40.3650226
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43.9043794
48.6182984
42.4349941
58.1033968
70.5315289
42.445825
83.0139781
55.6588008
84.4448946
63.1520014
49.5365516
77.8509906
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44.5500271
66.7854954
52.4025813
24.900164
73.3573743
36.0277211
70.773609
91.2961106
77.3921243
95.1916026
75.4923557
24.9735537
73.2096191
74.2827084
58.8441068
86.3329079
40.573061
47.4673729
75.9640099
58.0616113
41.5695916
77.1845034
69.1387645
20.8948238
59.5240594
62.6282552
48.4609332
61.9088901
69.0687121
61.6624126
55.5452084
71.2346621
63.5952817
43.9676886
69.8661309
58.7323286
47.150406
61.0840089
39.4045044
47.9141054
24.6627116
44.3880884
77.1212864
29.4963081
72.3784468
52.8457029
75.2912732
44.3134427
68.076899
54.7562586
66.7332439
65.8710605
60.9192852
79.3421345
76.6089511
33.4872772
54.7349646
62.3893177
36.0100445
83.9655948
38.99034
75.604727
65.6339524
66.1532002
42.9012977
61.4934415
50.6127239
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48.165398
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51.4957686
78.1803056
72.3275548
84.227044
59.1031395
67.6673179
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52.6705623
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70.3063368
53.6429026
45.0026683
51.1715695
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76.0064596
74.6704237
55.1682416
64.4288118
62.374035
48.7013975
83.4428077
61.1288406
32.9937753
77.0848085
60.4517057
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41.5196139
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57.3932757
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58.9635301
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64.4862184
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64.4758643
61.2368662
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35.201865
57.2614815
49.6105108
42.0950574
73.7834662
61.6992041
67.7465914
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47.6579727
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18.3487394
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36.3918335
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62.0564352
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75.4581173
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81.9540546
77.2547868
86.8997994
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69.2764316
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83.4184478
50.693697
32.6249621
65.6062189
58.1813594
76.2971363
61.9912496
61.8541224
44.6599899
19.2897899
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49.7123754
72.1983081
70.9754052
81.2306401
51.1427236
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50.6094397
37.4806708
52.3901487
57.3591834
17.8481509
45.516697
49.5102854
52.7348705
83.0265204
55.8501489
39.5736559
67.5551974
71.7190018
53.5843611
40.8787395
88.6013156
80.4480584
32.8176359
45.5682732
55.3050692
62.1574649
82.331539
50.8163801
49.6089977
60.2022994
39.2112127
43.1919175
57.7920822
73.1191016
62.6941751
49.2682379
66.1398742
62.7858383
40.2192676
31.9259744
69.9901885
40.1926796
66.5592734
57.0840615
42.6328888
56.3614373
42.494629
78.8847292
45.52957
64.1276313
75.0631913
62.4270248
54.5816038
42.6496813
62.8882871
59.6025888
62.6110287
76.5045601
90.2295179
85.8053265
32.5114479
90.6267321
95.2456902
file format will
81.4204612
57.8844087
file format will
74.9443637
71.1708448
39.5726367
48.18401
60.81163
76.0436688
69.6060108
79.7431291
63.2318043
57.2325602
43.807744
50.1461216
57.7714115
71.675045
97.8033836
58.935047
56.8746673
51.1003472
57.5703006
28.668655
64.6274276
55.0240999
68.6698494
36.760606
58.8236233
43.4580186
76.717053
56.147073
33.8477295
61.5847864
61.887406
42.9120048
73.0349185
73.7542134
74.0606579
60.2472022
64.8454776
76.1941626
38.3101109
29.9490771
41.0936733
65.0000869
71.130997
62.9089541
78.420697
68.2755988
63.102074
43.2138961
70.8785092
71.1215341
60.0596434
45.5805433
41.1463997
60.5273193
48.0548372
50.8860212
33.6368868
48.2355793
74.0548345
70.9487345
47.158155
23.4877938
52.4020923
63.4273162
64.1970899
38.4719426
47.9304059
67.3118056
109.886712
82.4614849
62.0788542
53.3605346
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55.5599873
55.3605025
56.706628
71.6889038
40.2192404
94.2965281
60.8648676
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68.676499
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79.4513079
28.2417279
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55.6827602
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100.642126
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65.8884506
53.5972779
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59.7901594
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63.2715636
52.3620059
26.3597366
68.3199739
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70.5554922
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68.5191099
70.0355125
44.3890717
57.8609842
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41.4150788
60.8460622
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51.2877161
63.5614376
70.8563111
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48.3711209
70.2180869
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37.5077288
33.8504529
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49.2283936
51.6610325
59.7623059
77.5703821
25.6856372
62.3124818
57.619118
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115.607809
36.9298085
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72.9162132
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62.0815446
56.7873289
58.6224792
53.3039705
74.2302329
72.2933663
52.9756204
75.1139115
64.8304647
70.0959224
50.1516998
33.2691901
78.5653328
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77.2632701
44.6879261
49.2231745
54.4724037
80.2977822
32.3774429
73.219017
69.9404901
32.3303886
82.7429301
69.84502
45.8683382
41.7759424
54.9341169
59.9749863
65.5127297
74.8643367
59.4202672
38.3934918
62.0927319
69.4810784
62.099961
58.5854905
70.3859729
81.5200543
38.2630575
64.6687831
71.8321602
56.4544329
60.0489571
64.9177639
58.7136132
59.1462038
78.5205269
82.894503
68.2265634
45.2472469
99.456171
42.1713617
59.5415105
86.7301942
42.0251127
58.8800665
60.1566253
37.9047172
52.8295142
48.1956362
39.1183157
46.9266219
66.7214261
62.7679875
52.6829415
71.7849743
53.2678349
51.9350758
37.3845941
64.5198366
59.3178325
50.1359797
60.2429864
62.4118821
64.5951948
82.4939616
75.3596125
73.3540492
65.3835388
63.9804452
64.9679379
61.4002065
54.1161026
59.7188883
52.7882073
77.8602299
54.4338711
56.7789329
49.944597
56.397413
51.2491037
69.5756862
91.3216668
80.4068296
51.3075535
47.9284597
63.5951102
71.8407215
51.65344
85.8581605
41.1879324
47.2588256
65.1145086
42.9915863
66.1337667
61.6360544
75.585386
62.6940035
40.5939593
48.6093508
24.8394582
45.280375
54.2086886
40.4031878
51.5411126
76.7540659
47.4032654
60.0267528
82.7110943
96.3254375
56.5119912
75.6488904
66.4165756
62.6014861
63.727494
59.7034703
43.5654852
71.9286866
17475.5349
P(X)
1 0.2 0.2
2 0.05 0.25 0.2
3 0.1 0.35
4 0.2 0.55
5 0.45 1