Analytics Flashcards
What is the definition of statistics
The science of turning data into information
what is the role of statistics in management
improve decision making, problem solving, and process
how can corelation and regression be used in management
identify key variables and reducing variation
what can general management use statistics for
forecasting
macro-economic trends
cost analysis
pricing
what is correlation
a linear relationship between two variables
identifying cause and effect
does NOT prove causation
why do you use scatterplots?
show how a movement in X causes a change in Y.
show if X and Y tend to move together
what is ‘r’
correlation value
ranges from -1 to 1
R^2 is equal to the square of r
what is r^2
the percent of variation in Y explained by x, ranging from 0-100%
what is regression
evaluating the mathematical relationship between variables
What should you do if r^2 is less than 0.5
keep looking for data
What should you do if r^2 is between 0.5 and 0.75
you are looking smart
What should you do if r^2 is between 0.75 and 0.9
GOLD! Make MoneyWh
What should you do if r^2 is greater than 0.9
be suspicious
what are p-values
the probability of getting the calculated F if the hypothesis is true
what does it mean if p is less than and greater than 0.5
less - there is an important relationship
more - there is too much variation and not enough evidence
