quantitative data, if the variables can be measured in numerical terms. For example, daily temperature, height and weight of individuals, price and income, etc. are quantitative variables. Their values can be expressed numerically.
Qualitative Data : Sometimes, it is not possible to measure variables numerically, in the same straight forward manner as heights and weights of individuals, or prices of commodities, or income of individuals. For example, attitudes of people to a political system, intelligence of individuals and their aptitudes towards music and art, beauty of individuals or some objects (like flowers, gardens etc.) cannot be numerically measured. However, we may rank them according to the quality of their attributes.
Once four persons (husband, wife and two children) set out to cross a river. The father knew the average depth of the river. He also knew the average height of his family members. The average height of two family members was greater than the average depth of the river. So he thought that his family members could cross river safely. But one of the family members (child having less height than the depth of the river), drowned. The fault was not with the statistical method of calculating average but lack of commonsense.
(a) Statistics and the study of consumption.
(b) Statistics and the study of production.
(c) Statistics and the study of exchange.
(d) Statistics and the study of distribution.
(a) The producer or the manufacturer has to estimate demand for his goods in the immediate as well as distant future. This is done by market research for which all the steps to statistical method have to be followed. The cost accountant uses statistical tools to help the producer to fix the prices of various commodities.
(b) The trader-wholesaler or retailer depends heavily on methods of statistical analysis for finding out solution to problems regarding buying and selling activities.
(c) Insurance companies function on the basis of estimations of mortality rates, that is, life expectations and on this basis calculation of insurance premiums is done. Accordingly they decide what proportions of their capital can be invested and what proportions kept ready for payments of matured policies.
(d) Other public utility bodies, such as the road transport companies, the railways, advertising concerns, warehouses etc., which contribute to commerce in a significant way, also make use of statistical data for their efficient functioning. For instance, they have to determine the extent of demand that would be made on their services and the rates they might fix for the same. In fact no modern organization can survive and efficiently function without analysis of the complex factors that influence commerce, and for systematic business analysis statistical tools are absolutely essential.
1. It does not study the qualitative aspect of a problem.
2. It does not study the individuals : It
is study of mass data and deals with aggregates of facts.
3. Statistical laws are true only on an
average : They are not universally applicable like the laws, of chemistry, physics and mathematics. They are true on an average because the results are affected by a large number of causes.
4. Statistics can be manipulated : The results obtained can be manipulated according to one's own interest and such manipulated results can mislead the community.
5. Statistical results lack mathematical accuracy : The results drawn from statistical analysis are normally approximates. As the statistical analysis is based on observation of mass data, number of inaccuracies may be present and it is difficult to rectify them.
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