Chapter 1: What Is Statistics?

1.1 Introduction

This chapter provided an introduction to the two general bodies of methods that together constitute the subject called statistics: descriptive statistics and inferential statistics. Descriptive statistics consists of methods for organizing, summarizing, and presenting data in a convenient and usable form. Inferential statistics, which occupies the larger portion of the textbook, consists of a body of methods for drawing conclusions about characteristics of a population based on information contained in a sample taken from the population.

1.2

Key Statistical Concepts

This section described the three key considerations present in the solution to any statistical problem: the population, the sample, and the statistical inference. The population refers to the collection of all measurements of interest in a statistical problem, such as the salaries of all workers in a community. A characteristic of the population, such as the average salary, is called a parameter of the population. Suppose the problem is to estimate the value of this population parameter. This estimate is called an inference, or conclusion, about the population parameter (that is, about the average salary). An estimate can be obtained by soliciting the salaries of a properly selected group of workers (called the sample) from the community and calculating the average of this sample of salaries. As always, this sample is a subset of the entire population. The average salary of the group of workers is called a sample statistica descriptive measure of the sample. If we use the average salary of the group of workers as an estimate of the average salary of the entire population, then we are drawing a statistical inference, or conclusion, about the population based on information provided by a sample taken from the population.

Example 1.1
An election is to be held soon to determine who will be the mayor of a certain city. Based on the results of a pollsters survey of 400 eligible voters, a newspaper has reported the proportion of eligible voters who favor Ms. Winn, one of the candidates. Identify the population and its parameter, the sample and its statistic, and the inference of interest in the situation described.

Solution
The population is the collection of all residents of the city who are eligible to vote in the election. The population parameter is the proportion of all eligible voters who favor Ms. Winn. The 400 eligible voters surveyed by the pollster constitute the sample, and the sample statistic is the proportion of these 400 eligible voters who favor Ms. Winn. The inference is the estimate (reported by the newspaper) of the proportion of all eligible voters who favor Ms. Winn.

Example 1.2
According to USAToday (15 October 1987), the average size of an American household had fallen from 3.14 persons in 1970 to 2.66 persons in 1987. a) The 1987 figure of 2.66 is claimed to be the value of a population parameter. What are the population and the parameter? b) What procedure must be taken to be 100% certain that the value of the population parameter is exactly 2.66? c) What procedure was likely used to arrive at the 1987 figure of 2.66? Use the terms sample, sample statistic, and inference in your answer.

Solution
a) One can imagine determining the numb er of persons living in each and every household in the United States. The set of all these (millions of) numbers is the population of interest. The average of this population of numbers is the parameter of interest, which is claimed to be 2.66. b) You would have to collect all the numbers in the population (called taking a census) and then compute the average of all the numbers. c) It is likely that only a relatively small subset of all American households was selected and the number of persons living in each of these households obtained. The set of numbers obtained for the selected group of households is a sample drawn from the population. The average of the sample values, called the sample statistic, was then computed to be 2.66. The statement that 2.66 is the average size of all American households is an inference about the population parameter; it may or may not be correct.

EXERCISES
1.1 Thousands of customers have accounts at a large department store. An accountant claims that the average unpaid balance for these accounts is $75, a figure obtained by computing the average of the unpaid balances for 50 of the accounts. a) Identify the population and its parameter.

b) What is the sample?

c) Is the figure of $75 a parameter or a statistic?

1.2

A psychologist has interviewed 250 school children throughout New York State and found that 80% of them spend at least 25 hours a week watching television. a) Identify the population parameter and the sample statistic of interest here.

b) Comment on the following inference, which is based on the results of the psychologists interviews: 80 percent of American school children spend at least 25 hours a week watching television.