4.4 Descriptive Statistics

1. What Are Descriptive Statistics?

Descriptive statistics are numerical measures used to summarize and analyze business data. They help businesses make informed decisions by identifying trends, patterns, and averages within a dataset.

2. Key Measures of Descriptive Statistics

Descriptive statistics will include the following.

• Mean: is another word for average.

  • • The sum of all values divided by the number of values.

    • Used to find the typical value in a dataset.

    • Example: Average revenue per customer.

• Mode: refers to the most frequently occurring value from a set of values.

  • • Useful for identifying the most common category or trend.

    • Example: Most popular product sold by a business.

• Median: is the middle value in a list of ordered numbers.

  • • Useful when there are extreme values (outliers) that might distort the mean.

    • Example: Median salary in a company to avoid distortion by very high or low wages.

• Bar charts:  a chart with rectangular bars showing the values represented 

• Pie charts: a circular graph in which segments of the circle represent percentages of the total

• Infographics: a graphic representation of information 

• Quartiles: result from dividing a set of numbers into quarters

  • • The range between the 25th percentile (Q1) and the 75th percentile (Q3).

    • Helps remove the influence of outliers.

    • Example: Comparing the middle 50% of salaries in a company to remove extreme values.

• Standard deviation: looks at the dispersion of data around its mean

  • • A low standard deviation means data points are close to the mean (less variation).

    • A high standard deviation means data points are widely spread (more variation).

    • Used for risk analysis in finance, sales forecasting, and market research.

✔ Helps managers make data-driven decisions (e.g., pricing strategies, sales forecasts).
✔ Identifies trends and patterns (e.g., peak sales periods, customer preferences).
✔ Assists in risk assessment (e.g., analyzing profit variations).
✔ Aids in market research (e.g., understanding customer demographics).

🔹 Sales & Revenue Analysis – Use mean and standard deviation to compare sales across months or stores.
🔹 Customer Satisfaction – Use median ratings to avoid bias from extreme reviews.
🔹 Market Research – Use mode to find the most common consumer preference.
🔹 Risk Management – Use standard deviation to measure fluctuations in stock prices.

✅ Mean, median, and mode summarize central values.
✅ Range, standard deviation, and IQR measure data spread.
✅ Understanding these tools helps businesses make better strategic decisions.

4.4 Descriptive Statistics Exam Questions

https://drive.google.com/file/d/1BF0xoZvnChJ0z4G1lDYno9FTZYkyd_nP/view?usp=sharing 

4.4 Descriptive Statistics Exam Questions Answers

https://drive.google.com/file/d/1C9mK69Ri4puIgAeK5tmuUda9QNWTAeXp/view?usp=sharing 

4.4 Descriptive Statistics Exam Questions - InThinking

https://docs.google.com/document/d/1e6CJZi-QXqMR_SnN2hBMEtbWH-KFAY4LsATBqNsV34E/edit?usp=sharing 

4.4 Descriptive Statistics Exam Questions ANSWERS - InThinking

https://docs.google.com/document/d/1dU3Aozz1rbZMaj1YSLRnyrq7nHZr18mWbNi65zjIK0Q/edit?usp=sharing