Chapter 2: Charts and Graphs 1

Chapter 2 Charts and Graphs

LEARNING OBJECTIVES The overall objective of chapter 2 is for you to master several techniques for summarizing and depicting data, thereby enabling you to: 1. 2. 3. Recognize the difference between grouped and ungrouped data. Construct a frequency distribution. Construct a histogram, a frequency polygon, an ogive, a pie chart, a stem and leaf plot, a Pareto chart, and a scatter plot. CHAPTER TEACHING STRATEGY Chapter 1 brought to the attention of students the wide variety and amount of data available in the world of business. In chapter 2, we confront the problem of trying to begin to summarize and present the data in a meaningful manner. One mechanism for data summarization is the frequency distribution which is essentially a way of organizing ungrouped or raw data into grouped data. It is important to realize that there is considerable art involved in constructing a frequency distribution. There are nearly as many possible frequency distributions for a problem as there are students in a class. Students should begin to think about the receiver or user of their statistical product. For example, what class widths and class endpoints would be most familiar and meaningful to the end user of the distribution? How can the data best be communicated and summarized using the frequency distribution? The second part of chapter 2 presents various ways to depict data using graphs. The student should view these graphical techniques as tools for use in communicating characteristics of the data in an effective manner. Most business students will have some type of management opportunity in their field before their career ends. The ability to make effective presentations and communicate their ideas in succinct, clear ways is an asset. Through the use of graphics packages and such techniques as frequency polygons, ogives,

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histograms, and pie charts, the manager can enhance his/her personal image as a communicator and decision-maker. In addition, emphasize that the final product (the frequency polygon, etc.) is just the beginning. Students should be encouraged to study the graphical output to recognize business trends, highs, lows, etc. and realize that the ultimate goal for these tools is their usage in decision making. CHAPTER OUTLINE 2.1 Frequency Distributions Class Midpoint Relative Frequency Cumulative Frequency Graphic Depiction of Data Histograms Frequency Polygons Ogives Pie Charts Stem and Leaf Plots Pareto Charts Graphical Depiction of Two-Variable Numerical Data: Scatter Plots KEY TERMS Class Mark Class Midpoint Cumulative Frequency Frequency Distribution Frequency Polygon Grouped Data Histogram Ogive Pareto Chart Pie Chart Range Relative Frequency Scatter Plot Stem and Leaf Plot Ungrouped Data

2.2

2.3

SOLUTIONS TO PROBLEMS IN CHAPTER 2 2.1

a)

One possible 5 class frequency distribution: Class Interval 10 - under 25 Frequency 9

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25 40 55 70

- under 40 - under 55 - under 70 - under 85

13 11 9 8 50

b) One possible 10 class frequency distribution: Class Interval 10 - under 18 18 - under 26 26 - under 34 34 - under 42 42 - under 50 50 - under 58 58 - under 66 66 - under 74 74 - under 82 82 - under 90 Frequency 7 3 5 9 7 3 6 4 4 2

c) The ten class frequency distribution gives a more detailed breakdown of temperatures, pointing out the smaller frequencies for the higher temperature intervals. The five class distribution collapses the intervals into broader classes making it appear that there are nearly equal frequencies in each class. 2.2 One possible frequency distribution is the one below with 11 classes and class intervals of 2. Class Interval 39 - under 41 41 - under 43 43 - under 45 45 - under 47 Frequency 2 1 5 10

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47 49 51 53 55 57 59

- under 49 - under 51 - under 53 - under 55 - under 57 - under 59 - under 61

18 13 15 15 7 9 2

The distribution reveals that only 13 of the 100 boxes of raisins contain 50 1 raisin (49 -under 51). However, 71 of the 100 boxes of raisins contain between 45 and 55 raisins. It shows that there are a few boxes (5) that have 9 or more extra raisins (59-61) and two boxes that have 9-11 less raisins (3941) than the boxes are supposed to contain. 2.3 Class Interval Frequency 0-5 6 6 5 - 10 8 14 10 - 15 17 31 15 - 20 23 54 20 - 25 18 72 25 - 30 10 82 30 - 35 4 86 TOTAL 86 Class Midpoint 2.5 7.5 12.5 17.5 22.5 27.5 32.5 Relative Cumulative Frequency Frequency 6/86 = .0698 .0930 .1977 .2674 .2093 .1163 .0465 1.0000

The relative frequency tells us that it is most probable that a customer is in the

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15 - 20 category (.2674). Over two thirds (.6744) of the customers are between 10 and 25 years of age. 2.4 Class Interval Frequency Frequency 0-2 218 2-4 207 4-6 56 6-8 11 8-10 8 TOTAL 500 Class Relative Cumulative Midpoint Frequency 1 3 5 7 9 .436 .414 .112 .022 .016 1.0000 218 425 481 492 500

2.5 Some examples of cumulative frequencies in business: sales for the fiscal year, costs for the fiscal year, spending for the fiscal year, inventory build-up, accumulation of workers during a hiring buildup, production output over a time period. 2.6 Histogram

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Frequency Polygon

2.7 Histogram

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Frequency Polygon

2.8 Ogive

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2.9 STEM 21 22 23 LEAF

2, 8, 8, 9 0, 1, 2, 4, 6, 6, 7, 9, 9 0, 0, 4, 5, 8, 8, 9, 9, 9, 9 24 0, 0, 3, 6, 9, 9, 9 25 0, 3, 4, 5, 5, 7, 7, 8, 9 26 0, 1, 1, 2, 3, 3, 5, 6 27 0, 1, 2.10 Company Proportion .25 .20 .17 .12 .11 .11 .01 .01 Degrees 90 72 61 43 40 40 4 4

Andersen Worldwide Ernst & Young Deloitte & Touche KPMG Peat Marwick Coopers & Lybrand Price Waterhouse Grant Thornton McGladrey & Pullen

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BDO Seidman TOTAL Pie Chart

.01 .99

4 358

2. 11

Company Delta United American US Airways Southwest TOTAL

Proportion .27 .22 .21 .15 .15 1.00 360 79

Degrees 97 76 54 54

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2.12 Brand Huggies Pampers Luvs Drypers Fitti Private Labels TOTAL Pie Chart Proportion .413 .256 .121 .033 .009 .158 .990 Degrees 149 92 44 12 3 57 357

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2.13

STEM

LEAF 1 2 3 4 3, 6, 7, 7, 7, 9, 9, 9 0, 3, 3, 5, 7, 8, 9, 9 2, 3, 4, 5, 7, 8, 8 1, 4, 5, 6, 6, 7, 7, 8, 0, 1, 2, 2, 7, 8, 9 0

8, 9 6 7 5 0, 1, 4, 5, 6, 7, 9 0, 7 8

The stem and leaf plot shows that the number of passengers per flight were relatively evenly distributed between the high teens through the sixties. Rarely was there a flight with at least 70 passengers. The category of 40's contained the most flights (10). 2.14 Complaint Number % of Total

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Busy Signal 420 Too long a Wait 184 Could not get through 85 Get Disconnected 37 Transferred to the Wrong Person 10 Poor Connection 8 Total 744

56.45 24.73 11.42 4.97 1.34 1.08 99.99

2.15

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3500

3000

2500

Industrial Products

2000

1500

1000

500

0 0 1000 2000 3000 4000 5000 6000 7000

Hum an Food

2.16

180

160

140

120

Sales

100

80

60

40

20

0 0 2 4 6 8 10 12

Advertising

2.17 Class Interval Frequencies

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16 - under 23 23 - under 30 30 - under 37 37 - under 44 44 - under 51 51 - under 58 TOTAL 2.18

6 9 4 4 4 3 30

Class Interval Frequency Midpoint Rel.Freq. Cum.Freq. 20 - under 25 25 - under 30 30 - under 35 35 - under 40 40 - under 45 45 - under 50 17 20 16 15 8 6 22.5 27.5 32.5 37.5 42.5 47.5 .207 .244 .195 .183 .098 .073 .207 .451 .646 .829 .927 1.000

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2.19

Class Interval 50 - under 60 60 - under 70 70 - under 80 80 - under 90 90 - under 100 TOTAL Histogram

Frequencies 13 27 43 31 9 123

Frequency Polygon

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Ogive

2.20 Label Value Proportion .180 .397 .272 .151 1.000 Degrees 65 143 98 54 360 A 55 B 121 C 83 D 46 TOTAL 305 Pie Chart

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2.21 STEM 28 29 30 31 32 33 2.22 Total

1 2 3 4 5 6 7 8 9 10 673 29 108 379 73 564 12 402 54 202 2496 Pareto Chart: 26.96 1.16 4.33 15.18 2.92 22.60 0.48 16.11 2.16 8.09

LEAF 4, 6, 9 0, 4, 8 1, 6, 8, 9 1, 2, 4, 6, 7, 7 4, 4, 6 5 Problem Frequency Percent of

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2.23
16

14

12

10

0 0 2 4 6 8 10 12 14 16 18

2.24 Olson Company Frequency distribution Class Interval 32 - under 37 Frequency 1

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37 - under 42 42 - under 47 47 - under 52 52 - under 57 57 - under 62 62 - under 67 67 - under 72 TOTAL

4 12 11 14 5 2 1 50

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2.25 Class Interval 20 25 25 30 30 35 35 40 40 45 45 50 TOTAL

Frequency 8 6 5 12 15 7 53

Class Midpoint 22.5 27.5 32.5 37.5 42.5 47.5

Relative Frequency 8/53 = .1509 .1132 .0943 .2264 .2830 .1321 .9999

Cumulative Frequency 8 14 19 3 46 53

2.26 Frequency Distribution: Class Interval 10 - under 20 20 - under 30 30 - under 40 40 - under 50 50 - under 60 60 - under 70 70 - under 80 80 - under 90 Frequency 2 3 9 7 12 9 6 2 50

Histogram

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Frequency Polygon

The normal distribution appears to peak near the center and diminish towards the end intervals. 2.27 a) Histogram and a Frequency Polygon for 2.25 Class Interval 20 - 25 25 - 30 30 - 35 35 - 40 40 - 45 45 - 50 TOTAL Frequency 8 6 5 12 15 7 53 Cumulative Frequency 8 14 19 31 46 53

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Histogram

Frequency Polygon

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b) Ogive

2.28 Asking Price $ 60,000 - under $ 70,000 $ 70,000 - under $ 80,000 $ 80,000 - under $ 90,000 $ 90,000 - under $100,000 $100,000 - under $110,000 $110,000 - under $120,000 Frequency 21 27 18 11 6 3 86 Cumulative Frequency 21 48 66 77 83 86

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Histogram

Frequency Polygon

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Ogive

2.29 Amount Spent on Prenatal Care $ 0 - under $100 $100 - under $200 $200 - under $300 $300 - under $400 $400 - under $500 $500 - under $600 Frequency 3 6 12 19 11 6 57 Cumulative Frequency 3 9 21 40 51 57

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Histogram

Frequency Polygon

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Ogive

2.30 Price $1.75 - under $1.90 $1.90 - under $2.05 $2.05 - under $2.20 $2.20 - under $2.35 $2.35 - under $2.50 $2.50 - under $2.65 $2.65 - under $2.80 Frequency 9 14 17 16 18 8 5 87 Cumulative Frequency 9 23 40 56 74 82 87

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Histogram

Frequency Polygon

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Ogive

2.31 Genre R&B Alternative Rap Country Soundtrack Metal Classical Latin TOTAL Albums Sold 146.4 102.6 73.7 64.5 56.4 26.6 14.8 14.5 Proportion .29 .21 .15 .13 .11 .05 .03 .03 1.00 Degrees 104 76 54 47 40 18 11 11 361

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Pie Chart

2.32
700

600

500

400

300

200

100

0 0 5 10 15 20 25 30 35

Agric ultural P roduc ts

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2.33 Industry Chemicals Primary metals Paper Plastics & Rubber Transportation Equipment Food Fabricated Metals Petroleum Electrical Equipment TOTAL Total Release 737,100,000 566,400,000 229,900,000 109,700,000 102,500,000 89,300,000 85,900,000 63,300,000 29,100,000 Proportion .37 .28 .11 .05 .05 .04 .04 .03 .01 0.98 Degrees 133 101 40 18 18 14 14 11 4 353

Pie Chart

Elec. Petroleum Equip. Fab. Metals 3% 1% 4% Food 4% Transportation Equipment 5% Plas. & Rubber 5% Chemicals 38%

Paper 11%

Primary Metals 29%

2.34

Chapter 2: Charts and Graphs 34

Problem 2.34
500 400 100 80 60 40 20 0
in ult Fa sti Pla c ss ne ick Th le nd Ha en ok Br ling be La c D is ion rat olo

Count

300 200 100 0

Defect
Count Percent Cum %

221 44.2 44.2

117 23.4 67.6

86 17.2 84.8

44 8.8 93.6

32 6.4 100.0

2.35 STEM 42 43 44 45 46 47 48 49 50 51 52 53 54 55 56 57 58 59 2.36 LEAF 12, 16, 24, 32, 99, 99 04, 28, 39, 46, 61, 88 20, 40, 59 12 53, 54 30, 34, 58 22, 34, 66, 78 63 48, 49, 90 66 21, 54, 57, 63, 91 38, 66, 66 31, 78 56 69 37, 50 31, 32, 58, 73 19, 23

Percent

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STEM 22 23 24 25 26 27 28 29 30

LEAF 00, 68 01, 37, 44, 75 05, 37, 48, 60, 68 24, 55 02, 56, 70, 77 42, 60, 64 14, 30 22, 61, 75, 76, 90, 96 02, 10

2.37 The distribution of household income is bell-shaped with an average of about $ 90,000 and a range of from $ 30,000 to $ 140,000. 2.38 Family practice is most prevalent with about 20% with pediatrics next at slightly less. A virtual tie exists between ob/gyn, general surgery, anesthesiology, and psychiatry at about 14% each. 2.39 The fewest number of audits is 12 and the most is 42. More companies (8) performed 27 audits than any other number. Thirty-five companies performed between 12 and 19 audits. Only 7 companies performed 40 or more audits. 2.40 There were relatively constant sales from January through August ($4 to 6 million). Each month from September through December sales increased with December having the sharpest increase ($15 million in sales in December).