Meaning and Scope of Statistics


Statistics is a mathematical science pertaining to the collection, analysis, interpretation or explanation and presentation of data. It provides tools for predicting and forecasting the economic activities. It is useful for an academician, government, business etc.

On the basis of various definitions provided by economists, statistics has been broadly defined in two senses: first is in plural sense and the second is in singular sense.

In plural sense, statistics refers to numerical facts and figures collected in a systematic manner with a specific purpose in any field of study. In this sense, statistics is also aggregates of facts expressed in numerical form.

The characteristics about statistical facts are:

Aggregate of facts

Numerically expressed

Data affected by multiplicity of causes

Enumerated according to reasonable standard of accuracy

Collected in systematic accuracy

Collected for pre-determined purpose and

Placed in relation to other

In singular sense, statistics refers to a science which comprises methods that are used in the collection, analysis, interpretation and presentation of numerical data. These methods are used to draw conclusion about the population parameters.

The stages of statistical analysis are:

Collection of data

Organisation of data

Presentation of data

Analysis of data and

Interpretation of data

Statistics helps in business forecasting, decision making, quality control, search of new ventures, study of market, study of business cycles, useful for planning, useful for finding averages, useful for bankers, brokers, insurance, etc.

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  • Q1

    State two functions of statistics ?


    The two functions of statistics are as follows:

    (i) Statistics simplifies complex data.

    (ii) Statistics presents the facts in a definite form.

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  • Q2

    What is meant by statistical analysis?


    Statistical analysis is the method of collecting data and providing interpretations for a given area of enquiry.

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  • Q3

    What is the purpose of placing statistics in relation to each other?


    Statistics or data are placed in relation to each other so that they can be compared easily.

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  • Q4

    Distinguish between quantitative and qualitative data with examples.


    If the variable can be measured in numerical terms it is quantitative data. A statement like” The production of rice in India has increased from 39.58 million tones in 1974-75 to 58.64 million tones in 1984-85 is a quantitative fact.
    Sometimes it is not possible to measure some variables numerically, these variables are termed as quantitative data. These variables describe the attributes of a person or groups. For example honesty, beauty, etc.

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  • Q5

    Enumerate different steps in any statistical analysis.


    Following are the different stages in a statistical method :

    1. Collection of Data: Collection of data constitutes the first step in a statistical investigation. Data should be carefully and systematically collected because they form the foundation of further analysis. If data is faulty and inadequate then the conclusion drawn from it would become fallacious.

    2. Organisation of Data: Organisation of data refers to edition, classification and tabulation of data, There may be omissions, inconsistencies and errors in the collected raw data which needs processing. In the first stage data should be corrected by means of editing. The next step is to classify them according to their common characteristics. The last step in organisation is tabulation. Tabulating the data under proper headings helps to remove the complexity and makes them simple and clear. It also facilitates further statistical analysis.

    3. Presentation of Data: The tabulated data may be represented by means of attractive diagrams and graphs so that even a layman can understand the nature of problem presented.

    4. Analysis of Data: The very object of organising the data is to analyse them. Methods used in analysing the data are numerous. Measures of averages, measures of dispersion, correlation, regression etc. are some of the important tools, which are used to analyse the data.

    5. Interpretation of Data: The last stage in statistical investigation is interpretation. It means drawing conclusions from the data collected and analysed. It is really a difficult task and so it needs a high degree of skill and experience.

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