S1 Foundations PDF

S1 Maths + Stats Foundations
Change History
Date
29-June-2007
9-July-2007
26-November-2007
30-November-2007
06-June-2008
04-December-2009
26-May-2010
31-May-2010
1-June-2010
10-June-2010
17-Sep-2010
22-June-2011
20-Sep-2012
5-Oct-2012
23-Oct-2014
29-Feb-2016
Description/Change
Original (draft v1)
Added change history section at start. No content changes.
All content reviewed, with some updates.
Minor changes.
Range of small changes as a result of year end review. Additions to index
numbers topic.
Update all % to 2dp for consistency, and small additions/changes.
Minor updates after S2 exams corrected. Added TOC.
Added calculator section.
Updated calculator info, and referenced video at ITB.
Various minor updates.
Added section on taking exams.
Added table of GFD column calculations. Added references/details for
formula methods for median + mode for a GFD. Other minor updates.
Minor correction to GFD table formula.
Updated calculator info to include EL520X.
Minor updates.
Updated calculator info to allowing students use their own in exams.
Page 1 of 54
Contents
Introduction .............................................................................................................................................................. 3
Core Topics .............................................................................................................................................................. 5
Studying .................................................................................................................................................................... 5
Calculator ................................................................................................................................................................. 8
Exam Tips............................................................................................................................................................... 11
Topic Overview ...................................................................................................................................................... 13
Topic 1 Basic Maths ............................................................................................................................................ 15
Sigmas ................................................................................................................................................................ 15
Rounding ............................................................................................................................................................ 18
Rounding Examples........................................................................................................................................ 18
Topic 2 - Data collection and presentation ............................................................................................................. 20
Create a GFD ...................................................................................................................................................... 20
GFD table (KEY Stuff!) ..................................................................................................................................... 24
GFD Table Columns....................................................................................................................................... 25
GFD Table Detailed Example ........................................................................................................................ 26
GFD Table Practice Example ......................................................................................................................... 31
Less than (percentage) charts (including the GFD median, quartiles and percentiles) ...................................... 33
Histogram for GFD............................................................................................................................................. 41
Topic 3 - Data Analysis .......................................................................................................................................... 43
Mean, median and mode for a list of values ....................................................................................................... 43
Mean, and Graphical Methods for median and mode for a GFD ....................................................................... 43
Median and mode for a GFD: Formula Method ................................................................................................. 47
Median: Formula method ............................................................................................................................... 47
Quartiles + Percentiles: Formula Method....................................................................................................... 49
Mode: Formula Method .................................................................................................................................. 49
Topic 4 - Index numbers......................................................................................................................................... 51
Topic 5 - Financial Maths 1.................................................................................................................................... 54
Page 2 of 54

Introduction
The details below attempt to outline some foundation material for semester 1 business mathematics and statistics
(BM&S). This should help anyone who has difficulty with BM&S or who just wants to pass, to narrow down the
topics you will cover. While I must say to everyone to in fact cover all topics as best you can (which is obviously
the best advice), I can also add that anyone who knows the topics below VERY WELL, has a strong chance of at
least getting a D or C in the exam. But you would have to know these VERY WELL, so that you could answer
all associated questions in the exam.
-
Before I go any further I cant stress enough how important it is to study & practice past exam
papers. This is THE single most important component of studying for most exams, and certainly for
maths exams!!
Most students who fail seem (generally) to have done very little ongoing practice throughout the
semester, or in preparation for the exam. Practice is absolutely critical to passing maths!
This is third level ... Get stuck in and get on with it! ;-) It is up to you (not me1, or anyone else) to look
after yourself!
On the day of any exam things can go wrong, or not go as you expect, so dont bank on passing by
doing a minimum amount of preparation. It often leads to students failing. Practice and prepare at
least 3 good questions2 as best you can.
My advice is based on experience with hundreds of students over many years. If one of your
classmates says something that contradicts what I suggest who should you believe!?
I only ask this because I have seen students follow rumours3 that impact their behaviours and result
in what are mad decisions from my point of view ... and failing overall. Trust me ... I have a pretty
good idea what generally works and what doesnt for most students4! :-) ... if you hear a rumour or
exam advice ... why not ask me if it is true, or a good idea!?
Topics that are or are not covered on a CA in no way indicates anything to do with the final exam.
The final exam typically covers all topics we will cover over the entire semester practicing past
papers you will see this.
Practicing past exam questions is an absolutely key approach to passing. I would suggest you practice at least 3
years of past exams and more if you have the time. That way you get a good idea of the range of questions
possible, although each exam will be different. Past exam papers are available in the hyperlinked notes (in student
share at ITB), which also contains some of the model answers for these exams. Just using these alone someone
could learn enough to pass, indeed to do well!
Ill help!
For my exams you are asked to answer 3 out of the 4 given questions on the paper. You may answer all 4 if you wish, and I will mark
your best 3. For most students it is best to prepare for 3 and put your time and effort into these. Look at and practice past exam papers.
3
One year during semester 2 a rumour went around that I would definitely ask a particular topic (least squares) in a question. Most of the
students didnt prepare the alternative topic (moving averages), and guess which one was actually on the exam that year!!? Moving
averages! No one asked me! I would have explained to definitely prepare both, in this instance.
4
There are always exceptional students who can get away with odd approaches. Most of us are not exceptional and need to put in time
and effort on whatever we want to be good at!! For example, some students can work alone so missing classes doesnt affect them so
much ... but again these are very much the exception. The vast majority of students that miss maths classes suffer as a consequence. Just
ask past students in the years ahead of you!
1
2
Page 3 of 54

What I suggest is Start with the material below. It is the foundation material, and an excellent starting point.
Once you have this sussed as best you can, then start looking at exam questions outside of this material and see
what additional material you can master. The more you know the better chance you have to pass.
Students who struggle with maths often find it hard to spend time studying and thinking about maths. This is only
natural ... who among us spends time focusing on something we dont like!? But this then causes a catch 22 ... You
cant be good at something you dont put time and attention in to!!
What we focus on and practice we get better at. So do try, as best you can, to take some time over the topics, and to
understand as much as you can. Understanding material, rather than just trying to learn it all off, is far superior to
rote learning. This takes time, which is why it is best to study throughout the semester rather than trying to cram at
the end. In addition, crammed, rote, learning off of material is far more likely to give you a blank during an exam!
Our memories need time to build up.
The fact that a topic is listed below is not a guarantee that it will be on the exam it simply means that it is
foundation. It is in knowing all of these foundation topics that you can get yourself to the position of getting that D
or C, or higher.
If you want to get a high grade, then you would have to cover additional material not mentioned here. See notes
and material as covered in classes for details.
It is probably best to print this out to have it as a reference. Ive included the change history at the start so that you
can easily check if I update to a later version (ie check any printout you have now and again against the date above
on the web version if there is a difference then Ive updated something).
BOOK: Some students prefer a "book", rather than the lecture notes ... remember that many/most topics are
covered well in: Business Mathematics and Statistics, by A. Francis. Copies are available in the ITB library, or
available from Amazon or Easons, and others. Not everything is in the latter book, nor do I always agree with what
is in the book, but it is a pretty good support to use if you want a "book".
First Ill give an overview below, and then there follows a section on each topic. Im only human so this document
will probably (unfortunately!) contain errors ... Let me know if you spot anything, or if you have any suggestions
for improvements.
Page 4 of 54

Core Topics
If you go through the overview then youll perhaps see why what I suggest you consider as your core focus is:
- How to create a GFD

- All columns in the GFD table (you wont always need them all in a specific exam
question)
- Less than and Less than percentage chart for a GFD
- Histogram for a GFD
- Mean, median and mode for a simple list/set of values
- Mean, median and mode for a GFD using the GFD table columns
- All of index numbers
I think it would be quite possible to cover all of the above in around 8 hours (or less, depending on yourself) of
studying and practice. Throw in another couple of hours of practicing questions, and previous exam papers, and
that should be enough to get most students through! Obviously some students may need longer, or will need help,
but 8 hours seems reasonable to me as a ball-park typical figure.
These are the topics I will give detailed examples of in the details sections below, following the overview. No topic
is guaranteed on any exam, unless I specifically indicate otherwise (such as the likes of boundaries!!). When
working through the list above, or the details below take your time ... just attempt one thing at a time. There is little
point, in my opinion, in reading through all of the details here ... in fact it is more likely to put you off as it could
all seem bigger than it really is!!. It is better, in my opinion, to use this document as a checklist that you work
through bit by bit. So start at the first topic and master that, and then look at the next one, and so on. Do things bit
by bit learn something, then have a go at repeating an example, then have a look at an exam question, and then
move on to learning the next thing, and so on. Little by little dont try and do too much in one step, as that can
put any of us off!!
In exams make sure to list out details/steps as you go as these are usually required in order to have a chance at full
marks.
Studying
Practice is really the key to learning how maths is done. The theory/understanding side of maths requires some
thought. Material that you understand you are also far more likely to remember, and far more likely to be able to
answer variations on typical exam questions. However, it is possible to pass business maths without delving too
much into the understanding ... as I say, it is better if you do take the time to understand, and this will help you, but
what I want to do here is to outline what someone who just wants to pass [or do well] needs to do.
[My] Suggestions for studying:
-
If you find maths easy enough then you should still be careful and put in sufficient time into maths ... Ive
seen quite a number of very capable students actually fail maths, because they just didnt do sufficient work
to pass, or they missed too many classes. Every single class missed is a hole in your knowledge, and plenty of
research shows that those that dont attend classes, tend to have a far higher fail rate ... so attend all classes is
my first advice for all students.
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-
No matter how bad you think you are at maths, or how hard or confusing you find it, just pick a topic and
use the notes and other resources to try and work it out ... ie do your best ... ask your mates, and ask me.
Basically you have gotta start somewhere, so just pick something and start!! But give yourself time
Rome was not built in a day, and some maths topics may take a couple of attempts to come to grips with. So
take your time, and allow yourself time to actually master material. Some students (particularly mature
students) can be way too hard (in my opinion) on themselves, from what I have seen over the years. We cant
be perfect at everything, and sometimes being good enough is all we can do in life. This is not to suggest to
just give up, or accept lower standards, but it is to suggest to be realistic. If you can do more then thats great;
but if doing more will really stress you out then maybe it is time to accept where you are.
And then keep going ... using the help and supports that are there for you!!
Talk to your class mates Some of them might be getting on grand, and be happy to help you out if youre
stuck. Whether youre aiming for an A or hoping for a D, youll always find others who are similar to you,
who might be delighted to meet up once or twice a week to have a maths study group. Who knows, maybe
you will find romance in a maths study group! ;-)
If you get stuck then do something about it!! The semester will pass pretty quickly, so dont hang around
waiting for something miraculous to happen. Whatever supports are available, use them. Talk to your class
mates, talk to me, come to a workshop/clinic but do something! This is a life message as much as a maths
message Most problems (sadly!) dont go away until you tackle them. The good news is that once you do,
you will in time make progress; Such progress is often way better than you might ever have expected!!
Practice ongoing throughout the semester as material is delivered in lectures ... so that if you come across
any problems, you can then get help in tutorials and/or clinics (if available). Dont wait to be told what to do,
just get stuck in yourself studying and practicing.
Do not spend much time reading through maths ... read a bit (say from the hyperlinked notes), but then
practice an example, or attempt to repeat details that are given to you in the notes (or online). Say you read
through an example of how to calculate mean ... then I suggest that you then stop, get out your calculator
and see if you can do out the calculations for yourself. This is key.
Be careful reading a question, and then thinking I can do that, and then moving on!! You only know for
certain that you can in fact do it, when you do in fact do it!!!
Once you think you have the basics of a type of question mastered, using the hyperlinked notes, or other
resources (such as the web supports), then look at the past exam papers (which are in the hyperlinked notes,
along with some model answers) to practice actual exam type questions. While it can take a bit of work to
get there, it is a great confidence booster when you begin to realize that you can manage actual exam
questions.
You may have to put more time into maths than other subjects ... it depends on your existing level of
competence in maths, but I know past students have said that maths needed more time ... this is possibly
because you have to put time into doing out the practice problems.
Depending on your previous level of maths, you may or may not struggle to begin with ... you may find that
you are getting everything wrong (or it may feel like that), but trust me ... everyone, including me, has
periods like that when we are learning something completely new to us ... but (as with most things) if you
stick at it, with time, practice and help/supports, you will improve. And once you begin to improve, it is
possible using the previous exam papers to begin to get confident in maths. Ive seen this happen with all
kinds of past students, from those who felt they were no good at maths, to those who just hated it!!
If youre having difficulties then come talk to me in a tutorial or clinic, or make an appointment to see me. The
sooner we can get you on track the better ... it is my experience and opinion that pretty much all students can and
should pass business maths ... youve just gotta know how to tackle it, put in the time, use the supports, and not be
Page 6 of 54

put off. Work with me ... and remember that I want every single student to pass, so you have my support (within
reason), but youve gotta go do the core work. A key aspect of a 3rd level student is that you can work for yourself
(within reason), rather than always needing to be told what to do.
Page 7 of 54

Calculator
You must own your own calculator for examinations at ITB. Calculators may not be shared, nor may you use a
phone. Calculators for exams must not be programmable.
I do not recommend calculators where if you type 1 3 = you see a fraction as the result, rather than 0.333333333
(or similar)! Many Casio's are like this, and any Sharp with "WriteView" written on it. While these may be "nice"
to use, they can "encourage" bad habits, such as omitting brackets from calculations. Some of these calculators
may have an option to turn off this "fancy" display.
Figure 1: Sharp EL520W, along with the newer model as of Sep 2012, the EL520X. Both models essentially work the same from
our point of view.
Below are some brief pointers to useful keys on the EL520W followed by the same keys on the EL520X. You will
see that they are all the same!! You can view a larger version of this for the EL520W and EL520X on the web site
at: http://bbm.colmmcguinness.org/live/calculatorButtons.html. There is a video on the EL520W in my student
share area at ITB, in BM Common/Videos but note that it is old, and the rules relating to using your own
calculator in exams are no longer correct.
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EL520W
Page 9 of 54
EL520X
Page 10 of 54

Exam Tips
While educating yourself and expanding your ability are really the key goals of education, we cant deny that the
exams are there, and must be passed, so here are some key points that I have gathered from observing past
students, and indeed my own experiences and mistakes:
- Best preparation for most exams is practicing past papers:
This is stated in so many places because it is so important!! I recommend at least 3 years of past papers
thats two papers per year, so is 6 in total as a minimum. More if you can. For CAs at least thoroughly
practice the sample, and any available other practice material.
- Read questions carefully:
It is a very common mistake in most exams that some students will answer a different question to the one
actually asked! Hence even after you have started answering a question, it can be worth re-reading it, just to
be sure you are on the right track. Certainly once you have your answer completed, then re-read the
question to make sure your answer is complete, and actually answers what was asked, and is clear and
sufficiently detailed.
Another aspect of this is to make sure to follow all specific instructions:
If the question says that 4DP (4 decimal place accuracy) is required then you will lose marks if you dont
do this.
- Make your answers clear and succinct:
I often get sentence after sentence of what appears like pure waffle. If it is not clear that you knew
something that I cant give you full marks (or sometimes any marks!!).
One way to improve the clarity of some answers is to include an example to demonstrate your
ideas/thoughts.
Dont squeeze in bits of answers to different questions in different places! Leave space between different
questions so that your answers are clear. The problem is that you might well have put down correct
answers, but if I cant follow your work, or am not sure which question the answers relate to, then you will
lose marks.
Dont leave more than one different answer for a question, as I will split the marks!
- Dont round, unless you have to, or it says it in the question:
Students often lose marks due to poor rounding decisions. In general, unless there is good reason, you
should never round numbers at all (since they are then less accurate).
- Write down all details/steps:
Basically an exam is your chance to show off anything and everything that you know. So write details/steps
down!! I often get answers given that seem to come from nowhere; ie there are no supporting details on the
exam script. These will lose marks, or possibly get no marks at all. You must explain decisions you make
for example, and generally include sufficient details to make what you did, and why you did it, clear to me
and the external examiner.
- The number of marks for a question is a rough guide to the amount of detail expected:
Typically a 2 or 3 mark question will be a short calculation, or a few sentences, or an example, and
shouldnt take more than 2 or 3 minutes (roughly). Whereas a 12 mark question is going to be a longer or
more complex calculation, a few paragraphs, and will probably take a minimum of 10 to 15 minutes (very
roughly). Sometimes students write pages for a 3 mark question!! And such pages often result in zero marks
as they have completely missed the point. So keep an eye on the marks (in addition to reading the question
carefully, mentioned above).
- All exam books have on the front not to use red pen or pencil and yet loads of students do!!
WHY!!???? Please dont use any red pen or pencil or marker for anything for my exams. It annoys me, and
makes marking your exam more time consuming, and somewhat more prone to error. NO RED!!! Not even
for underlining NO RED!!! Are we clear?! ;-)
- Remember that in ITB end of semester exams you must use your own calculator.
Page 11 of 54

-
Dont in any way attempt to cheat, which includes having ANY notes in your possession (even if not
used!!), or talking during the exam, and anything that attempts to misrepresent your
ability/knowledge:
Ive talked about this in classes. I will provide lots of supports to help students along. While it is a breach of
institute regulations to attempt to cheat or to be caught cheating, it is also a personal affront to me, having
put in many many hours of work every year for students (whether yez know it or not! ;-)). Cheaters will be
subjected to institute policies in relation to cheating, and could be expelled from ITB. Nerves and other
pressures can put pressure on some students who feel they have to do something, but it is just not worth
it. It is better to fail and have the opportunity to repeat an exam, than to be caught cheating, have this as a
mark on your record, and possibly be expelled!!
After the results are out, if you feel the mark might be wrong, then consider a review/recheck:
Although I have several crosscheck procedures in place, I do make mistakes, albeit infrequently. With 200+
scripts to correct the odd mistake could happen. This is what the recheck process is there to deal with. I will
not take any offense whatsoever if you look for a recheck. Contact admin to do this. Do it immediately after
the results are out as there are time limits.
Page 12 of 54

Topic Overview
Topic 1 - Basic Maths
Sigmas are a handy topic in this section, although not directly on every exam ... there is a video in BM
Common on how to do any sigma.
Fair rounding.
Topic 2 - Data collection and presentation
GFDs are a must, and boundaries in particular ... Practice material available on web site
(bbm.colmmcguinness.org), and more details in notes. There is also a video in BM Common which goes
thru how to do most of the columns in the GFD table ... although it doesnt give full details on the
projection method for the first and last boundaries. The video is available on CD from the library for home
usage. There is always at least one set of boundaries to be calculated in the exams, and sometimes two.
How to create a GFD is a common enough exam question (no guarantees!). There is a video in BM
Common which goes thru how to create a GFD. The video is available on CD from the library for home
usage.
The "less than" and "less than percentage" charts are particularly useful as they can come up as a question
in Q1 or Q2 (for median, and lots more) on the exam. Once you have the GFD table mastered then these
charts (and lots of others) are fairly straight-forward.
Although not as useful as the less than and less than percentage charts, if you have the GFD table done,
then drawing a histogram is simple enough, and can come up in Q1 or Q2 (for mode).
If you can draw a chart, then have a look, but you are probably already familiar with some (or all?) of the
charts ... there are a good few, but most are easily done, such as pie charts, bar charts, etc. If you know how
to do proportional pies then youll be able to do any pie. And if you know how to do a percentage bar
chart, then you have all of the ideas for any bar chart.
There's a fair amount of text type topics in this section on sampling and collection techniques, which some
students prefer ... although not always on the exams.
Topic 3 - Data Analysis
GFDs are a must, and boundaries in particular ... Practice material available on web site
(bbm.colmmcguinness.org), and more details in notes. There is also a video in BM Common which goes
thru how to do most of the columns in the GFD table. The video is available on CD from the library for
home usage. There is always at least one set of boundaries to be calculated in the exams, and sometimes
two.
Know how to do the mean and median for a simple list/set of numbers, and for a GFD ... there is almost
always a question on either the mean or median (no guarantees ... see previous exam papers). There is an
excel file GFD Table Analysis in BM Common/Additional Practice Questions, which can create and
show solution details for a GFD mean, median and mode question ( and other stuff too, such as a less
than percentage chart, quartiles, quartile deviation, standard deviation, and more!).
If you know how to do a histogram for a GFD then also include the mode for a GFD, as it just uses a
histogram.
If you get the mean suss'ed then the standard deviation is just a different formula, and one extra column in
the table. Don't be put off by the formula ... Fill it in like any other, bit by bit!!
If you get the median sussed out for a GFD then you know how to use the "less than" and "less than
percentage" charts, and once you have these charts you will be able to do lots of other things for a GFD,
such as quartiles, percentiles, and more (ie see notes for the details). These all come from the same charts.
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Notice the way that topics re-occur, so material from topic 2 above, will also help you with topic 3 here.
Topic 4 - Index numbers
Students tend to really like this topic!!

"Relatives" are index numbers for a single item (eg wages, production, etc). Basic index relatives are
simple. Samples done in notes. Two out of the three conversion techniques are also simple ... and the third
one ain't that tough either!! (Although it is a bit more involved).
"Composites" are index numbers utilising information for several items ... we only did four different
formulae, which are all on the formula sheet.
There's lots of supports available on the web site (bbm.colmmcguinness.org) to cover most of the possible
question types ... including a video on how to do composite index numbers.
A lot of past students manage full marks on this question, so it is well worth putting time into this topic.
Topic 5 - Financial Maths 1 (quite different to FM in semester 2)
Past students haven't "liked" this topic ... if youre any way decent at small amounts of "algebra"
(manipulating a formula) then this is a fairly handy topic ... but past students often prefer the more
"accounting"/tabular type questions from the other sections.
If you are not great at formulae then Id suggest you consider omitting this section and concentrate on the
others where you might get more marks for time invested studying. However this may effect how you will
get on in semester 2, as there is more financial maths then. Many past students did not seem to find this a
problem.
There is considerable web support/details available on my web site in the Financial Maths (S1) section.
This section covers most of financial maths type questions.
Page 14 of 54

Topic 1 Basic Maths
Sigmas
There is a video in BM Common on how to do any sigma. Sigmas are not on every exam, but are a handy topic if
they do come up. There is a sequence of steps if you follow them youll get the answer every time!
As an example, consider Q4, from Jan 2007 exam:
II) Where appropriate using these values:
x1=1, x2=2, x3=3, x4=4
y1=5, y2=4, y3=3, y4=2
Evaluate the following expressions
4
a)
xi2
i 1
3
b)
x i yi
i2
(5 marks)
Steps (from the notes):

1) Start from the first value for the index variable, eg often i=1
2) Blindly put this into the expression after the wherever the index variable occurs (very often i or j) Dont
do anything other than substitute for the index variable at this step. The maths/calculations come after the is
written out using these rules.
3) Add 1 to the index variable, and repeat 2, until the last allowed index value is exceeded.
4) Finally add up everything (which is all means add up).
So for the part (a), well start at i=1 put this value of i into the thing after the , everywhere you see an i. And
2
youll get x1 . Leave it like this for now. Move on to i=2, and do the same thing to get x2 , and keep going for i=3
2
and i=4 to get x3 and x4 . You stop at i=4, since that is the number on top of the . Whats on the bottom says
where to start, and whats on the top says where to stop.
In general sigmas are best done in a table. Using a table for this example you would start by listing out all of the i
values to get:
Page 15 of 54

i=1
i=2
i=3
i=4
Then you sub these i values, one at a time, into whatever comes after the (do not think about or interpret
what you get just write it down with the i (or whatever letter) substituted), and put these in the next column,
which now gives:
i=1
x12
i=2
x22
i=3
x32
i=4
x42
And only now do you sub in actual values from x1=1, x2=2, x3=3, x4=4 (very simple xs here!), which gives the
next column as:
i=1
x12
12
i=2
x22
22
i=3
x32
32
i=4
x42
42
Notice that the subscripts are now gone!! Sub-scripts play no part in the calculations, other than to tell us which x
to use.
Finally working these out, and adding them up gives the sigma answer as:
i=1
x12
12
i=2
x22
22
i=3
x32
32
i=4
x42
42
16
30
While it looks very long when written out here in such detail, this basic series of steps works for every sigma, so
getting the answers is quite systematic.
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Applying the same approach to part (b) gives i=2 our start, and i=3 as our ending index value, and the final table is:
i=2
x 2 y2
2* 4
i=3
x 3 y3
3* 3
17
Another exam sample question is from August 2005:

II) Using these values:
x1=21, x2=24, x3=21, x4=22
evaluate the following expressions
4
a)
2 xi
i 1
4
b)
x i x5 i
i 1
c)
xi 222
i 1
Try them the final answers are: (a) 176, (b) 1932 and (c) 6. Details for part (b), for example, are:
(After substitution
(Simplifying the
of the index variable subscripts )
i )
i=1
i=2
i=3
i=4
x1 x5 1
x 2 x5 2
x 3 x5 3
x4 x5 4
x1 x 4
x2 x3
x3 x2
x 4 x1
(Fill in values
)
21*22
462
24*21
504
21*24
504
22*21
462
=
There are some other situations not covered here see the video and notes for details.
Page 17 of 54
1932

Rounding
While rounding isnt often asked at all directly on final exams, it is considered, and marks are lost if significant
inaccuracies result from incorrect rounding or poor accuracy. So correct rounding is important.
The most common type of rounding that you will come across in BM&S is rounding to a few decimal places, eg 4
decimal places, which is generally written by me as (4dp).
Say we have the number 19,211.7495736580 then 4dp this is 19,211.7496 the steps to get this are:
-
Include all digits up to the decimal point.

Count out the required number (4 here) after the decimal. At this point we have 19,211.7495 this is
called the truncated value.
Look at the next digit down after where you stopped, which is a 7 here if it is a 5 or higher, then add 1 to
your last digit. If it is less than 5, then do nothing.
In this instance we add 1 to the final digit 5, to get 6 and the final rounded value is 19,211.7496.
In BM&S in general it is best to keep exact answers (ie all decimal places that the calculator gives you) throughout
all calculations. There are some situations where this is overkill, such as some of the time series stuff in semester 2,
but in most situations you should keep all digits if at all possible.
Rounding Examples
Round 43.274644 to 2DP.
(Have a go!)
Answer: 43.27 (2DP).
How?
The truncated number is: 43.27 for 2DP ... next digit down is a 4, so we need do nothing extra (ie no 1 to be
added). And were done!
Round 655.499999 to 3DP.
(Have a go ... No good to just read maths ... Gotta keep trying it for yourself!!)
Answer: 655.500 (3DP)
How?
The truncated number is 655.499 for 3DP. Next digit down is a 9, which is above 5, so we add a 1 to our last digit.
When adding a 1 to a 9 we carry in the usual way (ie we treat this as we normally would when adding):
655.499
+1
655.500
Round 21,859.996666667 to 2DP.
Answer: 21,860.00 (2DP)
Page 18 of 54

How?
The truncated number is 21,859.99 for 2DP. Next digit down is a 6, so we need to add 1 to our last digit:
21,859.99
+1
21,860.00
Round 509.9125 to 1DP.
Answer: 509.9 (1DP).
How?
The truncated number is 509.9 for 1DP. Next digit down is 1, so we dont need to do anything else. This is the
answer.
There are further practice examples at ITB in the student share folder BM Common/Additional Practice Questions,
in the Rounding Excel file. This is a great little computer program for practicing your rounding skills as it tests a
range of types of problems.
Page 19 of 54

Topic 2 - Data collection and presentation
Create a GFD
GFD stands for grouped frequency distribution. This just means that it is a table of groups of values that
summarises some overall set of data.
There is a video in BM Common on how to create a GFD (also available on CD from the library), and the steps and
a detailed example are in the notes.
The steps from the notes are:
1) Create data array (if not already done)

2) Exclude any extreme values, if present
3) Calculate the range = max - min
4) Divide the range by the number of classes required, and adjust the result UPWARDS until a natural actual
class width is obtained. Eg if your range is 120 and you are asked for 10 classes, then 120/10 = 12, then consider
using 15.
It all depends - What is easy to read?
5) Decide on a starting value, which should be the value at or BELOW the min, that works well with the actual
class width.
6) Create the classes from the starting value using the actual class width. Create opened ended if required.
Reinclude any extreme values and create the final GFD with frequencies and headings.
Step 1, the data array step will already be done for you in exams in the past students did also have to do this
step, but I found it was a bit of a waste of time, so I omitted it in more recent exams.
As an example well apply the steps to Q1 from Jan 2007:
Weekly sales of a medium sized garden centre in 000 have been recorded over a 34 week
period, with the following data array of results:
2
18
24
38
7
18
24
38
7
19
26
49
11
19
27
51
12
22
31
12
22
31
15
22
31
15
22
33
16
23
37
16
23
38
Create a grouped frequency distribution (GFD) to summarise the data into 4 classes of equal
width. The first and last classes should be open ended.
Show all steps and details involved in creating the GFD.
(8 marks)
Page 20 of 54

There are no real extreme values here How do I know this? Well it is a matter of opinion, rather than
knowing for definite, but if you look at how the data increase from one value to the next, there are no huge jumps
near the start or end. 31 to 33 (jump of 2), 33 to 37 (jump of 4), 37 to 38 (jump of 1), 38 to 38 to 38, which is no
jump, then 38 to 49 (jump of 11) to 51 (jump of 2). To have an extreme value here I would expect something like a
jump that is 2 or 3 or more times the biggest previous jump. If the final value in the list was 75 or 100, then this
would be a big jump from 49, and might be considered an extreme value.
Same idea applies for extreme small values. You look at the gaps going down the list for the values at the start and
if there is some huge jump (again at least 2 or 3 times the typical gap) then that might be an extreme value.
Normally there are only one or two extreme values, or very few anyway (it does depend on the amount of data).
I would layout the following steps as a single block of work:
Max =
Min =
Range = Max Min =
Number of classes required (from question) =
Potential class width = Range/NumClasses =
Actual Class width =
Starting value =
And you include this same sequence every time.
For the example this gives us:
Max = 51
Min = 2
Range = Max Min = 51 2 = 49
Number of classes required (from question) = 4
Potential class width = Range/NumClasses = 49 / 4 = 12.25
Actual Class width = 15 (you always round the potential up to a nice value to get the actual)
Starting value = 0 (you always round the min value (2 here) down, to work well with your actual class width to get
the starting value)
This completes steps 4 and 5.
Now the 4 classes, starting at the starting value and using the actual class width are:
0 and < 15
15 and < 30
30 and < 45
45 and < 60
If you are not happy to use the < (less than) sign then just put in the words less than, so the classes would then
be:
Page 21 of 54

0 and less than 15
15 and less than 30
30 and less than 45
45 and less than 60
This is fine in exams, and wont lose you any marks.
Question says first and last should be open ended, so we drop the start of the first class to open it open, and the
end of the last class to open it up to get:
< 15
15 and < 30
30 and < 45
45 and over
Opening up classes is usually done to cope with any extreme values that might occur in this or future data
collection.
The GFD we now have is:
Weekly Sales Number of
(000)
Weeks
< 15
15 and < 30
30 and < 45
45 and over
Headings should describe the actual content of the column. Here the data relate to the weekly sales so that gives
the column heading for the groups. Each value in the original data corresponds to the amount sold in some given
week, so when we count values we are counting the number of weeks, which gives the second, frequency,
column heading.
To fill in the frequencies simply answer the question: How many of the original values are less than 15, and if
you count them there are 6 values that are less than 15 (ie not including 15). Next how many values are 15 and
less than 30 (ie not including 30), and you should count out 18 of them. And so on, to get the final GFD:
Weekly Sales Number of
(000)
Weeks
< 15
6
15 and < 30
18
30 and < 45
8
45 and over
2
A quick check is to add up the frequencies, and it should add to the number of original values this adds to 34
here, which is the original number of weeks of data given. Job done!
Heres one for you to try from Jan 2006:
Page 22 of 54

As part of a medical study you have recorded the triglyceride levels (mg/dl) for 44 people, and
the resulting data array is:
79
117
168
222
343
83
125
181
228
343
85
133
199
228
345
91
133
201
230
397
91
134
203
238
91
136
208
241
93
143
209
242
106
151
213
254
107
152
216
281
113
167
221
310
Create a grouped frequency distribution (GFD) to summarise the data into 4 classes of equal
width. The first and last classes should be open ended.
Show all steps and details involved in creating the GFD.
(8 marks)
Note that there is no single right answer for these if you follow the steps and come up with a reasonable
summary of the data that satisfies the question asked then youll get the marks.
The 397 could be an extreme value here, although it is outside my guidelines, but not by much.
Have a go at it ... My final answer for this one is:
Triglyceride Number of
(mg/dl)
People
< 100
7
100 and < 200
16
200 and < 300
16
300 and over
5
Or another contender (if you used an actual width of 80) is:
Triglyceride Number of
(mg/dl)
People
< 80
1
80 and < 160
18
160 and < 240
16
240 and over
9
And other answers are possible too. If you have followed the steps, and have answered the question asked (eg
equal class widths, and open ended) and it looks good (ie natural looking class limits) then you will probably get
full marks.
Note that in an exam you MUST SHOW DETAILS to get full marks just giving the final answer is generally
not sufficient to get full marks, so include the individual steps (for all questions!).
If asked to create a GFD there is no need to (or marks for!) calculating boundaries or other columns from the
overall GFD table.
Page 23 of 54

GFD table (KEY Stuff!)
NOTE: If you can do the GFD Table then youre almost sorted Trust me!! Everything is down hill after that,
as the less than charts and histogram, and mean, median, mode for a GFD, and LOTS more not mentioned here in
this foundation document, are all just uses of the values in this table.
There is a video in BM Common on how to do most of the columns in the GFD table (also available on CD from
the library). There are always columns from this table on exams, and boundaries are a must know. There is a
section on the web site (Semester 1, option 4) that provides you with Q&A practice.
There is also an excel file in the semester 1 BM Common/Additional Practice Questions, called GFD Table
Analysis, which creates practice questions for the GFD Table, and also the mean, standard deviation, median and
quartiles (and more) so this is a very good practice tool. This is a more advanced version of the web site Q&A
practice.
There is a document in the lecture notes (also available in the students share hyperlinked version of the notes)
specifically on boundaries. Boundaries are simple to do just add two values, and divide by 2 yet are
fundamental to a lot of questions relating to GFDs.
The full GFD table has the columns shown on the next page. In a typical exam question you would not necessarily
need all of these, so need only include the ones that are asked. You may include them all if you want, but will only
get marks for the columns asked for, or needed in the question.
Page 24 of 54

GFD Table Columns
The first row shows the column heading from the GFD table.
The second (yellow/bolded) row shows the corresponding abbreviation for that column.
The third row briefly shows or describes how it is calculated. See the subsequent example for more details.
I would commonly omit the LL and UL columns. They are rarely asked in recent exams.
Some of this will only make sense after you have gone through the example that follows. I have included this table as I have been asked to by
past students.
Class Frequency Lower Upper Lower
Upper Boundary
Limit Limit Boundary
Freq or f
LL
UL
LB
UB
Calc.
UBs
Read Read
first,
from from
These two
then just
lower upper
ULcurrent LLnext
columns are the
copy the
part
part
GFD given in
UBs
2
of
of
the question.
down
each
each
one row
class class
to get the
LBs
Cumulative
Frequency
Cum. Freq
Running total
of the freq
column,
starting from
the first freq
and working
down.
Width
W
Mid-Point
MP
LB UB
UB - LB
Percentage Cumulative
Frequency
Reverse
Cumulative
Frequency
% Cum. Freq.
Rev. Cum.
Freq.
The cum. freq. values
Running
converted to percentages
total of the
of the total freq., ie
freq
column,
cum. freq.
100% but starting
Total of freq.
from the
bottom and
working
up!!
Page 25 of 54
Scaling Factor
Scaled Frequency
SF
S.Freq
First:
Standard
Width (SW) =
Biggest Width
Value.
SF * Freq
Then:
SF
SW
W
Percentage Reverse
Cumulative Frequency
Percentage Frequency
% Rev. Cum. Freq.
% Freq.
The rev. cum. freq. values

converted to percentages of
the total freq., ie
The freq. values converted

to percentages of the total
freq., ie
rev. cum. freq.

100%
Total of freq.
freq.
100%
Total of freq.

GFD Table Detailed Example
Taking Q2 from Jan 2007 as a sample:
The following grouped frequency distribution (GFD) summarises the cost of houses
purchased in an area over a one year period:
Cost (000)
< 440
450 and < 490
500 and < 600
630 and over
Number of
Houses
5
17
22
7
a) Using this GFD create a table of values with the following columns:
i) boundaries
ii) widths
iii) mid-points
iv) scaling factors
v) scaled frequencies
vi) cumulative frequency
vii) percentage cumulative frequency
(11 marks)
The missing columns from this question are the limits, the reverse cumulative, the percentage reverse cumulative
frequencies, and the percentage frequency, so Ill include them below for completeness.
The limits columns are simple, as there is no calculation as such required:
Number of
Cost (000)
Houses
< 440
5
450 and < 490
17
500 and < 600
22
630 and over
7
LL
UL
450
500
630
440
490
600
The limits just come directly from the classes: The first class is < 440, so has no lower limit, and this is indicated
in the table with the . The upper limit of this class is 440. And so on for the others.
Page 26 of 54

Number of
Cost (000)
Houses
< 440
5
450 and < 490
17
500 and < 600
22
630 and over
7
LB
290 *
445
495
615
Scaling Scaled
UB
Width MidPoint Factor
Freq
445
155
367.5
2.613
13.06
495
50
470
8.1
137.7
615
120
555
3.375
72.25
1020 ** 405
817.5
1
7
* Details for LB1 are below.

** Details for UB4 are below.
Number of
Cost (000)
Houses
< 440
5
450 and < 490
17
500 and < 600
22
630 and over
7
Cumulative
No. of
Houses
5
22
44
51
%
Cumulative
No. of
Houses
9.80
43.14
86.27
100.00
%
Reverse
Reverse
cumulative
cumulative
No. of Houses No. of Houses
51
100.00
46
90.20
29
56.86
7
13.73
% No. of
Houses
9.80
33.33
43.14
13.73
(There is no need for you in an exam to repeat the shaded area unless it helps you).
For details for all of the columns in the first part of the above answer watch the video in BM Common!! Details are
also available in the notes, in exam model answers (in hyperlinked notes), and problem sheets (at back of the
notes).
Briefly how I completed this was:
- Do UBs first. Boundaries are the mid-points between classes, and are calculated from class limits (which
are just the upper and lower values in a class description). So a class like 450 and < 490 has a lower limit
of 450 and an upper limit of 490. Sometimes the first class will have no lower limit (as here), and
sometimes the last class will have no upper limit (again the case here).
To get the first UB you add the upper limit from the first class to the lower limit of the next class, ie 440 +
450 to get 890, and then divide this by 2. That is the first UB, ie 445. Be careful of BOMDAS here. If you
want to do this all in one go then include brackets, ie calculate (440 + 450)/2
- Next UB is (490 + 500)/2 = 495
- Next UB is (600 + 630)/2 = 615
- Last UB is left for now.
- Copy the UBs down one, to get the LBs this is because as you fall off the end of one class at its UB you
are also at the beginning of the next class, ie the new classs LB. See notes for graphical example.
- Youll be missing the first LB which you leave for now.
- Next do the middle set of widths omitting the first one and last one for now, since we cant do them.
Widths are UB LB, which is straightforward.
- To get LB1 and UB4 (the last UB, which is UB4 here) there are steps in the notes, but I am just going to
refer to the projection method: When you are first learning the GFD table I would advise you to simply
put zero for the first LB, and something big for the last UB. Learn all of the other columns, and THEN
come back to work out how the projection method, and other methods for these boundaries work. While
this would get no marks in an exam, it does help avoid the complicated projection method when first
learning the table calculations.
Here, to start with, I would use LB1 = 0, and UB4 = 700 (for example). Once UB4 is bigger than LB4 that
Page 27 of 54

will do to get you started. If you are only learning the GFD table then I would now advise you to skip to the
<Continued> point below.
For LB1 this must be chosen to be a realistic minimum possible value. It is not 0 here, since it is not
realistic to purchase a house for 0 (unfortunately!). So if we look at the frequencies we see that going
backwards it goes from 17 to 5, which is roughly 1/3 (Calculate 17/5 to get the fraction 17/5 = 3.4,
which is roughly 3, so we are dividing by 3 each time, ie getting 1/3).
Continuing this pattern (ie continuing to divide by 3, in this case) wed get projected frequencies of 5/3 = 2
(roughly), and 2/3 = 1 (roughly) and finally 1/3 = 0 always keep going until you hit zero. These are the
projected frequencies, ie the number of houses.
We need the cost, which comes now from the upper limits of the classes note this, that you use the
ULs of the classes to get the LB (and later we will use the LLs to get the UB, so you use the opposite to the
boundary you want lower limit for upper boundary, and upper limit for lower boundary).
The gap between UL of 490 and the UL of 440 is 50, so the next class down would be 390 (=440 50),
which corresponds to our 2 projected frequency. Next one would be 340 (=390 50), corresponding to our
1 frequency and finally 290 (=340 50) corresponding to our 0. We stop here, and use this as our LB1.
Showing all of these workings on the table, which is normally how I do this in classes is:
290
340
390
Cost (000)
< 440
450 and < 490
500 and < 600
630 and over
0
3
1
3
2
Number of3
50
Houses
LB
UB
5
445
175 = 3 (roughly)
50
17
445
495
22
495
615
7
615
50
50
Width
50
120
The two shaded boxes are the two that I get from the existing info in the GFD, and then I use this to repeat
that same pattern for the projected values; frequencies first, doing divisions, until I hit zero, and then class
upper limits, corresponding to the projected frequencies, and doing subtractions.
Students sometimes wonder how I work out the 3 bit for the frequencies sometimes it is obvious if
you just look at the values involved, but even if it isnt What you want to know above is what do I divide
17 by to get 5 so in maths terms this is:
17
5
x
Solving this for x (multiply both sides by x, and then divide both sides by 5) gives:
17
x
5
which is 3.4, which then rounds to 3 (since the whole technique is only approximate anyway).
Page 28 of 54

In general you dont need to show these calculations, and can just divide the second frequency value by the
first to get the 3.4, and so on. Just remember how to then use this answer!! Ive seen students get confused
by doing one type of division (ie by 5 above, when calculating x) only to do a different division for the
projected frequencies a minor confusion, but be careful of it.
This is just one way to get a possible LB1 if you know what youre at there are other ways but
whatever you do make sure to give sufficient details so that I understand what you do. If you have justified
your LB1 as indeed a reasonable and realistic minimum then you will probably get the marks. Having said
that I would expect that most students would use the method given. It is important to use the original GFD
details, where possible, and this method does that.
(In reality all of the methods in the notes are only approximate ways to get the missing boundaries there
are better ways, but they require more advanced maths/stats.)
For UB4 (or whatever your last UB is in another question):
Same kind of idea, except now working forwards freq from 22 to 7 is again roughly 1/3, and carrying
this on gives 7/3 = 2, and 2/3 = 1 and 1/3=0 for our projected frequencies.
Going this time from the LL to LL, ie from 500 to 630, is a gap of 130, so the next limits would be 760
(freq=2), 890 (freq=1), 1020 (freq=0, so stop here). And this gives our projected maximum value for our
last UB.
All boundaries now completed.
<Continued>
NOTE: If you have used the LB1=0 and UB4=700, then you will get different answers for some of the
following parts. The full table of answers using LB1=0 and UB4=700 are shown below. The steps for
the columns are still the same as described here.
Fill in the missing two width values!
Mid-Points (MP) = (LB + UB) / 2, so (290 + 445) / 2 = 367.5, then (445 + 495) / 2 = 470, etc.
For scaling factor the formula is
Standard Width
. The standard width is either the most common
Width
width value, or else (if no most common) then the biggest one (which is what we will use), which is 405
here. So the formula for this problem is now:
405
.
Width
It is best to do the scaling factors (SF) and the scaled frequencies together, one row at a time.
First SF =
405
=2.612903226 now multiply that by the corresponding frequency value of 5 to get the
155
corresponding scaled frequency, which will be 13.06 (2dp). If in doubt then just keep all your decimal
places, but a little practice and thought and youll be able to work out what needs lots of decimal places and
what doesnt. Here the scaled frequency would be fine to 1 dp I left 2 in, but 1 would be fine.
Next SF =
405
=8.1 and multiply this by 17 to get the scaled freq of 137.7.
50
And so on for the remainder.

Cumulative just means a running total and that is how the cumulative frequency (which is the
cumulative number of houses purchased here always use descriptive column headings). As a running
Page 29 of 54

-
total we start off at the first frequency value of 5. For the next cumulative value we add in the next
frequency of 17, which gives 22. Next add on the next frequency of 22 to get 44, and so on.
The reverse cumulative frequency had nothing to do with the cumulative frequency!!!!. It is done exactly
the same method, but the values/answers will generally be different. You work from the last frequency of 7,
back up the frequency column. So the last reverse cumulative frequency is 7, then add in the 22 frequency
(working back up the frequencies) to get 29, then add in the next frequency of 17 to get 46, and so on.
To get either of the two percentage columns you simply divide the corresponding cumulative (or reverse
cumulative) value by the total of the original frequencies (51 here), and multiply by 100%.
So % cumulative values = 5/51*100%, then 22/51*100%, then 44/51*100% and 51/51*100%
% reverse cumulative values = 51/51*100%, 46/51*100%, 29/51*100% and 7/51*100%
So only the initial reverse cumulative is done from the bottom up. Everything else can be done from the top
down, including the percentage reverse cumulative values.
To get the % no. of houses is similar to the last two. Here it is calculated from the frequency column, with
each frequency values divided by the total of the frequencies (ie 51 here), and multiplied by 100%. For
example: First one is 5/51*100% = 9.803921569 or 9.80 (2dp). Next one is 17/51*100% = 33.33333333 or
33.33 (2dp). And so on.
And thats the table completed This is VERY LONG WINDED when I try and write out all the details, which is
why I really recommend (a) attending all classes, so you see it actually done out, (b) doing out an example for
yourself, (c) using the web site GFD Table Q&A (Semester 1, Option 4) for practice, and (d) watching the BM
Common/Videos GFD Table video.
The table answers if you had used LB1=0 and UB4=700 are below. I have shaded the parts that have the exact
same answers as above. The none-shaded parts are where the final answers differ from the above version. I stress
again that the techniques/steps are exactly as described above: It is just the numbers used that is different.
Cost (000)
< 440
450 and < 490
500 and < 600
630 and over
Number of
Houses
5
17
22
7
LB
0*
445
495
615
Scaling Scaled
Freq
445
222.5
1
5
50
470
8.9
151.3
120
555
3.708333 81.58
85
657.5 5.235294 36.65
UB
445
495
615
700 **
* For simplicity when you are first learning the GFD table LB1=0 will suffice. This gets no marks in an exam, but
still allows you (a) ignore the complicated projection method when first learning the table, and/or (b) proceed with
the rest of the table for full marks for these columns.
** For simplicity UB4=700. See comment for LB1.
Cost (000)
< 440
450 and < 490
500 and < 600
630 and over
Number of
Houses
5
17
22
7
Cumulative
No. of
Houses
5
22
44
51
%
Cumulative
No. of
Houses
9.80
43.14
86.27
100.00
%
Reverse
Reverse
cumulative
cumulative
No. of Houses No. of Houses
51
100.00
46
90.20
29
56.86
7
13.73
Page 30 of 54
% No. of
Houses
9.80
33.33
43.14
13.73

It might be a good idea now to stop reading, and attempt to calculate all of the above details for yourself. Practice
is absolutely key in maths!! Reading about maths is absolutely no substitute for actually doing maths.
Knowing how to do all values in the above table guarantees you some marks in the exam. There can be columns
from this table in both questions 1 and 2, depending on the questions. There is certainly always some of this in Q2.
It is not always in Q1 it depends. Boundaries widths and mid-points would be the most important in particular
of these as they are used the most. But once you have these the others are easy enough anyway!!
GFD Table Practice Example

As practice for you, have a go at Q1 from Jan 2006:
As part of medical study the weights of 44 people were recorded. A grouped frequency
distribution (GFD) summarising the data is:
Weight (kg)
< 86
90 and < 100
110 and < 120
120 and over
Number
of
People
4
16
21
3
i) boundaries
ii) widths
iii) mid-points
iv) scaling factors
v) scaled frequencies
vi) reverse cumulative frequency
vii) percentage reverse cumulative frequency
(11 marks)
But include all columns (ie add in the cumulative the % cumulative number of people, and % number of people).
There are two answers below, depending on whether the simple method is used for the first and last boundaries, or
the projection method.
Also note that it is possible to get different answers to what I give here, that could in fact also be correct!! If you
have applied the correct methods you could (at times) get different answers for the first LB and last UB, and this
would change some parts of the table (as highlighted in last answer, in the last section). If in doubt then ask me in a
clinic.
Page 31 of 54

Using the simple calculations for the first and last boundaries, I decided on LB1=0 and UB4=150, and my final
answers are:
Number of
Weight (kg)
People
< 86
4
90 and < 100
16
110 and < 120
21
120 and over
3
Weight (kg)
Number of
People
< 86
90 and < 100
110 and < 120
120 and over
4
16
21
3
LB
0*
88
105
120
Cumulative
No. of
People
4
20
41
44
Scaling Scaled
UB
Freq
88
88
44
1
4
105
17
96.5
5.176471 82.82
120
15
112.5 5.866667 123.2
150 **
30
135
2.933333
8.8
%
Reverse
Reverse
% Cumulative cumulative
cumulative
No. of People No. of People No. of People
9.09
44
100.00
45.45
40
90.91
93.18
24
54.55
100.00
3
6.82
% No. of
People
9.09
36.36
47.73
6.82
* LB1 = 0.
** UB4 = 150. This is arbitrary, so it would also be fine to use 130, or 200, for example. Once you use something
bigger than the last LB, it will be fine for this method. Remember again that this method will get no marks in an
exam. See notes on previous GFD table example.
Or
Using the projection method for the first and last boundaries gives:
Number of
Weight (kg)
People
< 86
4
90 and < 100
16
110 and < 120
21
120 and over
3
Weight (kg)
Number of
People
< 86
90 and < 100
110 and < 120
120 and over
4
16
21
3
LB
58 *
88
105
120
Cumulative
No. of
People
4
20
41
44
Scaling Scaled
UB
Freq
88
30
73
1
4
105
17
96.5
1.7647
28.24
120
15
112.5
2
42
130 **
10
125
3
9
%
Reverse
Reverse
% Cumulative cumulative
cumulative
No. of People No. of People No. of People
9.09
44
100.00
45.45
40
90.91
93.18
24
54.55
100.00
3
6.82
% No. of
People
9.09
36.36
47.73
6.82
* LB1: 4 is of 16, and we get projected frequencies of 4/4 = 1 and then 1/4 = 0. The corresponding upper limits
are 72 and 58, so LB1 = 58.
** UB4: 3 is 1/7 of 21 next projected frequency is 3/7 which is roughly 0. The corresponding lower limit gives
UB4 = 130.
Page 32 of 54

Less than (percentage) charts (including the GFD median, quartiles and percentiles)
The less than and less than percentage charts are probably the most important charts we do, as they can come
up as questions in a number of situations. Once you have these sussed you will probably find the more than and
more than percentage charts simple, but Ill leave you to look these up in the notes and problem sheets for yourself.
There are full examples done out in the lecture notes.
For the less than charts (both of them) the x values for the chart are the UBs, along with the first LB (youll see
why below).
LT = Less than.
The y values are the cumulative frequency for the LT, or percentage cumulative frequency for the LT% chart.
So once you have the GFD table, it is only a matter of knowing what to use to get this chart and youre almost
done. Then draw a large chart, label it well, and youre done!
So, for a LT chart you use:
x = UB, y = cum. freq. PLUS one additional point at x = LB1, y = 0.
and for a LT% chart you use:
x = UB, y = % cum. freq. PLUS one additional point at x = LB1, y = 0.
Page 33 of 54

As an example consider Q2 from Jan 2006, which is:
I) The following grouped frequency distribution (GFD) summarises the cost of houses
Cost (000)
< 320
330 and < 370
400 and < 440
450 and < 500
510 and over
Number of
Houses
12
21
34
12
3
i) boundaries
ii) widths
iii) cumulative frequency
iv) percentage cumulative frequency
(7 marks)
b) Graphically calculate the three quartiles for the GFD.
(7 marks)
c) Calculate the quartile deviation (qd) and quartile coefficient of dispersion (qcd).
(2 marks)
d) Using your chart from part (b) calculate percentiles P10 and P90, and hence calculate the 10
to 90 percentile range.
(3 marks)
Parts (b) and (d) of this specifically require a less than (LT) or less than percentage (LT%) chart. The percentage
version is simpler to use, if you have a choice, which you do here note that the question didnt specifically ask
for a LT or LT% chart, so you have to know that this is how you calculate any of:
-
Median
Quartiles
Percentiles
And another type of question that can come up is:

Using your chart calculate the number of houses that cost:
a) less than 475,000
b) more than 390,000
c) between 300,000 and 420,000
So Ill include the answers to these at the end.
There are examples of all of these types of questions in the lecture notes and problem sheets.
Part (a) details are left to you the final table is:
Page 34 of 54

Number of
Cost (000)
Houses
LB
UB
< 320
12
265 *
325
330 and < 370
21
325
385
400 and < 440
34
385
445
450 and < 500
12
445
505
510 and over
3
505
565 **
* Chosen to maintain equal class width of 60, so LB1 = 325 60.
** Chosen to maintain equal class width of 60, so UB5 = 505 + 60.
W
60
60
60
60
60
Cum
No. of % Cum No.
Houses of Houses
12
14.63
33
40.24
67
81.71
79
96.34
82
100.00
Notice that here we had equal class widths of 60, which makes the first LB and last UB simple. No need for
projections etc.
Simplest chart to use is the % chart, so Ill do a LT% chart here: So x (horizontal) values = UB and y (vertical) axis
= % cum no. of houses. And then you include the first x = LB, and y = 0 (always). So the full set of points are:
x
y
265
0
325 14.63
385 40.24
445 81.71
505 96.34
565 100.00
Note that you would use either a LT or a LT% chart, but not both Im just including both here so you have the
details for both.
For a LT chart, youd use the same x values, but the y values would be the cumulative no. of houses, and again at
x = LB1 you include y=0. So the points would be:
x
265
325
385
445
505
565
y
0
12
33
67
79
82
Now for the LT% chart:

- Make it large try and fill the page, or use as much space as you can manage.
- Label it: x and y axes and a title, and any other details (if applicable).
- Draw it with a ruler, with proper scales!
Page 35 of 54
(Try and fill the page with any chart you draw in an exam)
Page 36 of 54

Same kind of idea for the LT chart, other than y (vertical) axis try it (you have to practice these things for
yourself as much as possible), and you should end up with:
Im going to use the LT% chart to answer the questions, and then Ill discuss how to do them from the LT chart.
Ill make multiple copies of the chart as we go to illustrate the answer, but obviously in an exam you just use the
one chart for all answers.
Parts (b) and (d) come from the chart:
- The positions of the 3 quartiles are at 25% for Q1, 50% for Q2 and 75% for Q3.
- P10 is at 10% and P90 is at 90%.
Putting in these lines on the chart, starting from the y-axis percentage value; drawing a line across to the curve and
then down to the x-axis gives the answers:
Page 37 of 54
So from the chart:

- Q1 is 351 (approx)
- P10 is 310 (approx)
- P90 is 467 (approx)
You should attempt this problem for yourself now, before proceeding to see what problems you run in to in
creating the chart and getting the answers. Just reading this stuff through is probably a waste of time you have to
do problems for yourself. Youll also find that your answers will differ from mine, and this is probably down to
how accurately you can draw the chart. Your answers should be roughly the same as mine, but could differ by
perhaps 10 or 15 depending on how you draw the chart.
Thats parts (b) and most of (d) done from the LT% chart. For a LT chart you must first calculate the positions for
each of the values, whereas these are easy for the quartiles. So the position of:
Page 38 of 54

-
Q1 is 25% of the maximum of y. The max of y is 82 for the LT x,y values, so 25% of this is 82/100*25 =
20.5, so this will be the y value to get Q1.
Similar idea for Q2 (and all the others) Q2 is 50% of the maximum, which 50% of 82 = 41.
Q3 is 75% of the maximum, and 75% of 82 is 82/100*75 = 61.5
P10 is 10% of the maximum, and 10% of 82 = 8.2
P90 is 90% of the maximum, and 90% of 82 = 82/100*90 = 73.8
Now for the LT chart you go to each of these y positions, across to the curve and then down to the x-axis, and
youll get the quartile and percentile values. Try it you should get similar values to above.
So you see why using the LT% chart is simpler there is none of the details to work out the positions as they
are straight percentage values which can be easily read from the LT% chart.
To finish this question off:
Part (c), and using the formula sheet, qd = (Q3 Q1)/2 = (435 351)/2 = 42.
qcd = QD/median * 100% = 42/400*100% = 10.5%
Note that the median is the same as Q2.
Part (d) Any range is the max min, so the 10 to 90 percentile range is P90 P10 = 467 310 = 157.
The key thing in all of this, the core point that I wanted to put across to begin with is that the LT and LT% charts
are key, and come directly from the GFD table, and an ability to draw and label a chart.
Coming now to the second type of question, which was:
Using your chart calculate the number of houses that cost:
a) less than 475,000
b) more than 390,000
c) between 300,000 and 420,000
For these you know the x-value, and calculate the y values (which is the opposite of what we did for the quartiles
and percentiles above). Be careful with (b) since it is asking for a more than but we have a LT or LT% chart. Ill
again use the LT% chart to get the results these are actually simpler as worded here from a LT chart:
(Ive used smaller charts below to save space You should always use full sized charts as it is more accurate
when working by hand. And Ive use a separate chart for each answer for clarity reasons, whereas you would just
use the one chart for all answers.)
Page 39 of 54
So for (a) the chart tells us there are 91% (approx) of houses that cost less than 475. This is a percentage, so to find
the number, you get 91% of the total, ie 91% of 82 which is 74.62, or 75 (approx) houses. This would be simpler
from a LT chart, as it would give the number directly.
For (b) the chart is:
Page 40 of 54

Which gives 42% (approx), and 42% of 82 is 34.44 or 34 (approx). But this is the number less than 390,000, so
the number more than 390,000 will be 8234 which is 48 (approx).
For Part (c) the chart is:
Which gives 8% and 66%, approximately. So between these is 66 8 which is 58%. 58% of 82 is 47.56 which is
48 (approx) houses were between 300,000 and 420,000.
Histogram for GFD

Im going to leave some of the details for a histogram until we get to the GFD mode calculations, although it can
come up as a question in its own right in Q1.
Basically, each bar in a histogram starts at a lower boundary, and ends at an upper boundary, and its height is the
scaled frequency so just like the LT and LT% charts, once you have the GFD table you are more than half
way to having a histogram for a GFD.
A histogram for the same GFD as above for the LT charts follows as a quick example. Here the two extra columns
for the GFD table not given in the LT/LT% section are the scaling factor and scaled frequency. These are simple
here. Youll find (do it!) that all of the scaling factors are 1, and the scaled frequencies are then just the same as the
frequencies, so youll get:
Page 41 of 54
Cost (000)
Number of
Houses
< 320
330 and < 370
400 and < 440
450 and < 500
510 and over
12
21
34
12
3
LB
UB
265 *
325
385
445
505
325
385
445
505
565 **
60
60
60
60
60
Cum
No. of % Cum No.
Houses of Houses SFs
12
33
67
79
82
14.63
40.24
81.71
96.34
100.00
1
1
1
1
1
S.Freq
12
21
34
12
3
Num of Houses
First bar starts at 265 (the LB), ends at 325 (the UB) and has a height of 12 (the scaled freq). The next bar
starts at 325 (the LB for second class), ends at 385 (the UB for second class) and has a height of 21, and so on.
Cost of Houses Purchased in An Area

35
30
25
20
15
10
5
0
250 275 300 325 350 375 400 425 450 475 500 525 550 575 600
Cost (000)
Page 42 of 54

Topic 3 - Data Analysis
Mean, median and mode for a list of values
Set 1: 25, 19, 12, 7, 25
Set 2: 33, 44, 23, 27, 11, 19
Set 3: 78, 19, 78, 24, 24, 21
Mean = add up the values, and divide by the number of values
For set 1: 25 + 19 + 12 + 7 + 25 = 88, and divide by 5 to get 17.6
For set 2: 33 + 44 + 23 + 27 + 11 + 19 = 157, and divide by 6 to get 26.16666667
For set 3: 78 + 19+ 78+ 24 + 24 + 21 = 244, and divide by 6 to get 40.66666667
Median = put into order first, then pick out the middle item or average the middle two if needed.
Set 1 in size order: 7, 12, 19, 25, 25 middle item is 19.
Set 2 in size order: 11, 19, 23, 27, 33, 44, and there is no single middle item so take the average of the middle two,
which is (23 + 27)/2 = 25.
Set 3 in size order: 19, 21, 24, 24, 78, 78. Same idea as for set 2. The median is (24 + 24)/ 2 which is 24.
Mode = one that occurs the most sometimes there will be no value that occurs more than the others, and
sometimes there can be one, two or more that all occur more than some others.
Set 1: 25 occurs twice, so it is the mode
Set 2: all items occur once, so there is no mode
Set 3: 24 and 78 both occur twice, so these are the two modes
Mean, and Graphical Methods for median and mode for a GFD
Once again the GFD table is really the key step for each of these statistics for a GFD.
For the mean well need the mid-points. Weve covered the median already in the LT/LT% chart section. And for
the mode well need a histogram, which again we have covered the basics of. The formula methods for the median
and mode are discussed in the next section.
Using Q2 from August 2006 exam:
The following grouped frequency distribution (GFD) summarises the cost of apartments
Number of
Cost (000) Apartments
< 270
8
280 and < 330
25
360 and < 380
34
410 and < 450
12
460 and over
4
Page 43 of 54

b) Using this GFD create a table of values with the following columns:
i) boundaries
ii) widths
iii) mid-points
iv) scaling factors
v) scaled frequency
(8 marks)
c) Calculate the mean cost of an apartment in the area.
(4 marks)
d) Graphically calculate the modal cost (ie the mode) of an apartment.
(5 marks)
Ill leave the median to you as an exercise (since covered already above), you should get an answer from a LT%
chart of around 360,000.
The GFD table, including those columns needed for the mean (ie up to the mid-point) is:
Cost (000)
Number of
Apartments
LB
UB
< 270
8
90 *
275
185
280 and < 330
25
275
345
70
360 and < 380
34
345
395
50
410 and < 450
12
395
455
60
460 and over
4
455
560 ** 105
* LB1 chosen from projected classes: 8 is rough 1/3 of 25 (since 25/8 = 3.125), so:
UL Projected Freq
210
(8/3 =) 3
150
(3/3 =) 1
90
(1/3) = 0
MP
182.5
310
370
425
507.5
** UB5 chosen from projected classes: 4 is 1/3 of 12 (since 12/4 = 3), so:
LL Projected Freq
510
(4/3 =) 1
560
(1/3 =) 0
Once we have that part of the GFD table, the mean formula for an FD is x
fx . You have to use this

f
formula, as the one with an n in it is only for a set of values. For any formula, each sigma needs a column of values
to calculate the corresponding total, so we need a column of fx values and a column of f values. We have a column
of frequency values (the number of apartments column) already, so we just need a column of fx values. The fs
are the frequencies, and the xs are the mid-points. The new column is:
Page 44 of 54

fx
Total=
1460
7750
12580
5100
2030
28920
The total of the frequency column, the Number of Apartments here, (for
into the mean formula gives:
f ) is 83. So filling these two totals
fx 28920
83
f
348.4337349
This is 348,400 (4SF) a quick scan of the original GFD classes we see that this is somewhere in the middle
(which is a quick check on the mean, or median).
Finally for the mode we need a histogram. This was covered partially earlier. You need two extra columns onto the
table above, which are the scaling factor and scaled frequency. Details on how to get these were given earlier
have a go at this one the final answers are:
SF
Scaled
freq
1
2.6429
3.7
3.0833
1.7619
8
66.1
125.8
37
7.0
Although the scaling factors are only shown to a max of 4dp, I used the exact values to get the scaled frequencies.
If in any doubt then always include all decimal places. It is better to be too accurate than not accurate enough!!
Following the previous details on how to draw a histogram and calculate the mode, and drawing a large chart and
including all labelling, you should get something like:
Page 45 of 54
The mode for continuous data is at the highest frequency we can get that approximately as follows:
You put crossed lines into the highest class one line joins the top right corner of the highest bar to the previous
bar, at its top right corner. The second line joins the top left corner of the highest bar to the top left corner of the
next bar to the right. The whole of the results X is inside the highest bar (they are not really bars, but you get
the idea!).
Page 46 of 54

Where the two lines cross you drop a line down to the axis.
Reading off the mode from the dropped down line gives an approximate modal value of just under 370,000.
And that completes the mean, and graphical methods for the median and mode for a GFD.
Median and mode for a GFD: Formula Method

If you are happy with the graphical method for the median and mode for a GFD these sections (below) are not
core, and could be omitted for final exam purposes. In final exams you will be allowed use either a graphical
method or a formula method for calculating the median or mode, but might also be asked other questions on the
graphical approaches, so these are more important in terms of the final exam.
Median: Formula method

In any final exam question you will be allowed use either the graphical method or the formula method shown here.
However, other questions are also possible on the graphical method, so in terms of final exams the graphical
method is more important.
The formula method for the median involves the exact same initial steps in calculating the required GFD table
columns for a LT chart, ie boundaries, widths, and cumulative freq. The difference is that you dont then draw the
chart, but use the values in the following formula:
Median =
LBm
LBm
Fm1
fm
wm
represents the lower boundary of the median class.
N is the total of the frequencies.
Fm1 is the cumulative frequency of the class immediately before the median class.
f m is the frequency of the median class.
wm is the width of the median class.
So what is this median class???? ;-)
The median class is the GFD class that contains the value half way along the data. Half way along the data is
/2 where N is the total of the frequencies, ie N f .
Page 47 of 54

Our GFD table from the graphical median example is:
Cum No.
Number of
of
Cost (000)
Houses
LB
UB
W
Houses
< 320
12
265 *
325
60
12
330 and < 370
21
325
385
60
33
400 and < 440
34
385
445
60
67
450 and < 500
12
445
505
60
79
510 and over
3
505
565 **
60
82
First we need to know which class is the median class, ie which class actually contains the half way point within
the data.
There are a total of 82 values (ie N = sum of the frequencies, which is 12+21+34+12+3 which is 82). So the value
at the half way point is at N/2, which is 41 here. So the 41st data value is the median value. To find which class
contains this value you look at the cumulative column, and pick out the class that first equals or exceeds this half
way number.
Doing this (looking at the cum. no. of houses column):
For the first class 12 doesnt equal or exceed 41, so move to next class. Then 33 doesnt equal or exceed 41, so
move to next class 67 does exceed 41, so the median must be in this third class, ie 400 and < 440.
Why?
The cumulative column counts out all of the data, as a running total. So the first class has 12 data values in it. The
next class has 21, so by the end of this second class we will have a total of 33 values (ie the cumulative value, since
this is just the running total). Still not past the required 41st value that we want. The third class has 34 additional
values, which added to the current 33 gives 67 in total, and we now know that we must have passed by the required
41st value so the median is somewhere in this third class, and next the formula will help us find roughly where it
is!! (It is only a rough estimate, since the GFD itself is only a summary of the original values, so the exact data
are no longer available).
Once we know where the median class is, and we know what the individual letters represent, completing the
formula is just a matter of picking out the correct value from the GFD table:
Median =
LBm
Fm1
fm
wm
82
33
2
60 399.1176471.
385
34
And this is pretty close to our previous graphical answer.

You must (as always!!) be careful of BOMDAS here, since there is a mix of operations. Brackets were added
around the top part of the inner division, since this is a group being divided by the 34. In general you need to put
brackets around any groups that are operated on.
Page 48 of 54

Quartiles + Percentiles: Formula Method
The basic approach used for the median formula method also applies to the quartiles and percentiles formulae.
Again, in a final exam question you could use either the graphical method or the formula method, but the graphical
method is MUCH simpler when a number of answers are required (such as 3 answers for the 3 quartiles).
There are worked examples in the hyperlinked notes.
Mode: Formula Method

In any final exam question you will be allowed use either the graphical method or the formula method shown here.
However, other questions are also possible on the graphical method, so in terms of final exams the graphical
method is more important.
The formula method for the mode involves the exact same initial steps in calculating the required GFD table
columns for a histogram, ie boundaries, widths, scaling factors, and scaled frequencies. The difference is that you
dont then draw the chart, but use the values in the following formula:
Mode =
Dm1 LBm Dm1UBm

, where Dm1 S .Freqm S .Freqm1 ,
Dm1 Dm1
and
Dm1 S .Freqm S .Freqm1
This all possibly looks madly complicated, but it isnt!! Like a lot of maths, if you just take it step-by-step you will
get the required answer:
LBm is the lower boundary of the modal class.

UBm is the upper boundary of the modal class.
Dm1 is the scaled frequency of the modal class MINUS the scaled frequency of the next class.
Dm1 is the scaled frequency of the modal class MINUS the scaled frequency of the previous class.
The modal class is simply the class with the highest scaled frequency (which is simpler than finding the median
class in the previous section!!).
Applying the formula method to the graphical modal example, we had the following GFD table:
Cost (000)
Number of
Apartments
< 270
280 and < 330
360 and < 380
410 and < 450
460 and over
8
25
34
12
4
LB
UB
90 *
275
345
395
455
275
345
395
455
560 **
Page 49 of 54
SF
Scaled
freq
185
70
50
60
105
1
2.6429
3.7
3.0833
1.7619
8
66.1
125.8
37
7.0

The class with the highest scaled frequency is the 3rd class, so this is the modal class here. Next completing the D
values gives:
Dm1 125.8 37 88.8

Dm1 125.8 66.1 59.7
And finally completing the mode formula gives:
Mode =
Dm1 LBm Dm1UBm 88.8 * 345 59.7 * 395 54217.5
365.1010101
Dm1 Dm1
148.5
88.8 59.7
This agrees pretty well with the value obtained from the graphical method previously.
As with the median formula, we again must be careful of BOMDAS since we have a mix of operations, and so
brackets are included around the two groups, one on the top and one on the bottom.
Page 50 of 54

Topic 4 - Index numbers
Index numbers is one of past students favoured topics once you get the hang of the details this often gives some
handy exam marks.
As an example here is part of a question from Jan 2008:
Any index number is just
Current Value
100 . And for (index) relatives the current value and base value
Base Value
are just single values. For composite index numbers these involve doing out a sigma calculation to get the current
and base values, but that final calculation of the index number then uses the same formula as above.
Although an index number is just a percentage change, the % sign is generally left off.
You do one calculation for each time period in the question data, for we will do 3 calculations for (a) and 3 for (b),
one for each time period. The Current Value is just the one you are working on! And the base value is either
directly specified for you in the question (eg for (a) the 2005=100 means that 2005 is the base), or else the
question will be chain base which just means that the base is the period before the one you are working on. So
thats the details. Next we apply these to (a) just using the above formula, and knowing what is current, and what is
base.
Details for (a) one calculation per time period:
Here the base value is 72, since the question has 2005=100, which just means that 2005 is the base it does not
mean that we change 2005 value to be 100!! It is just a shorthand way to say what the base period is.
For 2005: So 2005 is base, and 2005 is current, so the calculation using the formula is:
72
100 100
72
For 2006: Again 2005 is base, since it is fixed by the question, and now 2006 is current. The formula is:
86
100 119.44 (2dp)
72
Page 51 of 54

For 2007: Again 2005 is base, and now 2007 is current (the one we are working on). The formula is:
80
100 111.11 (2dp)
72
And that is (a) completed. In an exam I would just do these in a table without all of the details I have here. So for
an exam I would suggest you would have as your answer:
2005
2006
2006
72
100 100
72
86
100 119.44 (2dp)
72
80
100 111.11 (2dp)
72
Details for (b) one calculation per time period:

This part is a chain base which just means that the base period is the one before the one we are working on.
For 2005: So current is 2005, and base is 2004 but we dont have 2004, so we cant do this one, and you
indicate this in an exam as shown in the table below. You must show this as part of your answer.
For 2006: Current is 2006, and base is previous to this, which is 2005. Answer this:
86
100 119.44 (2dp)
72
For 2007: Current is 2007, and base is previous to this, which is 2006 now (ie it has moved along, unlike a fixed
base which stays fixed for the whole question). Answer is:
80
100 93.02 (2dp)
86
And thats it for 7 marks!! Handy enough!! In table/exam format the answer to (b) is:
2005
2006
2006
86
100 119.44 (2dp)
72
80
100 93.02 (2dp)
86
This topic is covered to a great extent by the web site Index numbers Q&A, which allows practice of a large range
of question types. The web site video on composite index numbers shows how these are tackled. There are detailed
examples for almost everything in the hyperlinked lecture notes. I hope the example above can convince you to go
look at the notes and use the web site video (Semester 1, Option 1) and Q&A (Semester1, Option 5) to master all of
index numbers. It really is the handiest topic for the exams in the view of most past students.
You should start with basic fixed base and chain base relatives.
Then move on to the conversion techniques.
Then the real value indices.
These are all in sequence in the web Q&A software. Im leaving all details out here since it is just a matter for you
to use the Q&A software, and look up the hyperlinked notes (or the text book by Francis) if you need more info.
Page 52 of 54

This topic is done in such detail in the hyperlinked lecture notes and on the web site Q&A (Semester 1, Option 5)
that I would only be repeating those details here so it is best to look at the notes, and then try an example on the
web site. Then look at more notes, and try another example. And so on.
Once you have relatives (index numbers for a single item) then move on to composites. Again between the web
Q&A and the web site video (Semester 1, Option 1), the topic is well covered by supports so I wont go into more
detail here. Go and watch the video and try the examples within it, is my best advice. Note that composite index
numbers are a guaranteed part of a final exam question.
The one thing I will include here is how to understand changes in an index as this is kinda fundamental to
understanding what any given index number is telling us. This is like an example I did in class during the year:
A certain index was 130 in 2004. For 2005 which of the following produces the largest
increase in the index:
a) 21 point increase on 2004.
b) 19% increase on 2004.
c) 50 point increase on the base.
The thing to do is to just calculate each one, and see what the actual change is.
a) A points change is the simplest way to say how much any percentage value has changed by over time. A
21 point increase, just means the index is now 151 (ie 130 + 21).
b) When you are given a percentage change (ie 19% here), to see what the result is you must first get 1%,
then multiply (by 19 in this case) and then add (or subtract for a decrease) to the original. So a percentage
change is way more involved than a points change which is why you will generally hear of points
changes on the financial news (eg Dow Jones is up 10 points, or down 15 points way simpler than
something like the Dow is up 0.132%!!!).
Anyway index is 130, so 1% of this is 1.3, and 19% is then 19 times this, which is 24.7. Adding this on
(since it is an increase on 2004) gives the 2005 value of 154.7 which is a 24.7 points change. So this is
bigger than (a).
c) The base is always 100 so a points change on the base gives 150 here, which is only 20 points up on
2004.
So option (b) gives the biggest change and all that also explains the different ways that index changes might be
quoted and interpreted.
Go use the web!!! And then look at some past exam papers to see how much coverage the internet material is it
is not 100%, but it is pretty good!! Trust me!! ;-)
Page 53 of 54

Topic 5 - Financial Maths 1
If you want to tackle this topic (which is great!) then use the link to the material on my web site for
semester 1 financial maths. The Q&A software and web pages there pretty much cover the whole top, and theres
obviously more details in the notes.
Page 54 of 54

S1 Foundations PDF

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S1 Maths + Stats Foundations

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S1 Maths + Stats Foundations

- How to create a GFD

S1 Maths + Stats Foundations

S1 Maths + Stats Foundations

S1 Maths + Stats Foundations

S1 Maths + Stats Foundations

S1 Maths + Stats Foundations

S1 Maths + Stats Foundations

S1 Maths + Stats Foundations

S1 Maths + Stats Foundations

Topic 2 - Data collection and presentation

Topic 3 - Data Analysis

S1 Maths + Stats Foundations

Students tend to really like this topic!!

Topic 5 - Financial Maths 1 (quite different to FM in semester 2)

S1 Maths + Stats Foundations

Steps (from the notes):

S1 Maths + Stats Foundations

S1 Maths + Stats Foundations

Another exam sample question is from August 2005:

S1 Maths + Stats Foundations

Include all digits up to the decimal point.

S1 Maths + Stats Foundations

S1 Maths + Stats Foundations

1) Create data array (if not already done)

S1 Maths + Stats Foundations

S1 Maths + Stats Foundations

S1 Maths + Stats Foundations

S1 Maths + Stats Foundations

S1 Maths + Stats Foundations

% Rev. Cum. Freq.

The rev. cum. freq. values

The freq. values converted

rev. cum. freq.

S1 Maths + Stats Foundations

S1 Maths + Stats Foundations

* Details for LB1 are below.

S1 Maths + Stats Foundations

S1 Maths + Stats Foundations

For scaling factor the formula is

And so on for the remainder.

S1 Maths + Stats Foundations

S1 Maths + Stats Foundations

GFD Table Practice Example

S1 Maths + Stats Foundations

S1 Maths + Stats Foundations

S1 Maths + Stats Foundations

And another type of question that can come up is:

S1 Maths + Stats Foundations

Now for the LT% chart:

S1 Maths + Stats Foundations

S1 Maths + Stats Foundations

S1 Maths + Stats Foundations

So from the chart:

S1 Maths + Stats Foundations

S1 Maths + Stats Foundations

S1 Maths + Stats Foundations

Histogram for GFD

S1 Maths + Stats Foundations