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Chapter 4
Describing Data: Displaying and Exploring Data

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 Learning Objectives
LO4-1 Construct and interpret a dot plot.
LO4-2 Identify and compute measures of position.
LO4-3 Construct and analyze a box plot.
LO4-4 Compute and interpret the coefficient of skewness.
LO4-5 Create and interpret a scatter diagram.
LO4-6 Compute and interpret the correlation coefficient.
LO4-7 Develop and explain a contingency table.

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 Dot Plots 1

Dot Plot Summarizes the distribution of one variable by

stacking dots as points on a number line that shows all the
values.
Display a dot for each observation.
If there are identical values, the dots are “piled” on top of
each other.
• See the shape of distribution.
• Values where the data cluster.
• Good for smaller data sets.

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 Dot Plots 2

• Example: The number of vehicles served at two dealers.

Tionesta Ford Lincoln

Monday Tuesday Wednesday Thursday Friday Saturday
23 33 27 28 39 26
30 32 28 33 35 32
29 25 36 31 32 27
35 32 35 37 36 30

Sheffield Motors, Inc.

Monday Tuesday Wednesday Thursday Friday Saturday
31 35 44 36 34 37
30 37 43 31 40 31
32 44 36 34 43 36
26 38 37 30 42 33

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 Dot Plots 3

• Example continued

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 Measures of Position 1

The standard deviation is the most widely used measure of

dispersion.
We can also determine the location of values that divide a set
of observations into parts.

Quartiles: Divide a set of observations into four equal parts.

• Q1 : Value below which 25% of the observations occur.
• Q2 : Value below which 50% of the observations occur
(median).

• Q3 : Value below which 75% of the observations occur.

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 Measures of Position 2

• Deciles: Divide a set of observations into 10 equal parts.

• Percentiles: Divide a set of observations into 100 equal
parts.
• Let Lp refer to the location of a desired interval.
• For n observations, the 𝑝𝑡ℎ percentile is given by:
p
Lp = ( n + 1)
100
• Example: The 92𝑡ℎ percentile would be L92

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 Measures of Position 3

• Example: The commissions earned last month by a sample

of 15 brokers.
$2,038 $1,758 $1,721 $1,637 $2,097 42,047 $2,205 $1,787 $2,287
1,940 2,311 2,054 2,406 1,471 1,460

• Locate the median, the first quartile and the third quartile of
the commissions.

• First, sort the data from smallest to largest.

$1,460 $1,471 $1,637 $1,721 $1,758 $1,787 $1,940 $2,038 $2,047
2,054 2,097 2,205 2,287 2,311 2,406

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 Measures of Position 4

Example continued
25
• 𝐿25 = 15 + 1 =4
100
50
• 𝐿50 = 15 + 1 =8
100
75
• 𝐿75 = 15 + 1 = 12
100
$1,460 $1,471 $1,637 $1,721 $1,758 $1,758 $1,940 $2,038 $2,047
2,054 2,097 2,205 2,287 2,311 2,406

• 𝑄1 = $1,721 , Median 𝑄2 = $2,038 , 𝑄3 = $2,205

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 Box Plots 1

Box Plot A graphic display that shows the general shape of

a variable’s distribution. It is based on five descriptive
statistics: the maximum and minimum values, the first and
third quartiles, and the median.

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 Box Plots 2

• The interquartile range is 𝑄3 − 𝑄1

• Range of values between the first and third quartiles.

• 50% of a distribution’s values.
Outlier A data point that is unusually far from the
other.
• Greater than upper boundary: 𝑄3 + 1.5 𝑄3 − 𝑄1
• Lower than lower boundary: 𝑄1 − 1.5 𝑄3 − 𝑄1
• Marked as asterisks beyond last value less than the
boundary.
• Nor outliers: minimum or maximum should be the end
lines.
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 Box Plots 3

• Example: The Applewood Auto Group data and the buyer

age variable.

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 Skewness 1

• There are four common shapes.

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 Skewness 2

3 𝑥lj − Median
𝑠𝑘 =
Pearson: 𝑠

• Between −3 and 3.
• Near −3: considerable negative skewness.
• Near 0: symmetric.
• Near 3: considerable positive skewness.

n   x − x 3 
( n − 1)( n − 2 )   s  
Software skewness: sk =  

• Focus on the brackets with the mean and standard deviation.

• Called standardizing (discussed later).
• Values are larger than the mean: positive and skewed right.
• Values are less than the mean: negative and skewed left.

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 Skewness 3

• Example: The earnings per share for software companies.

0.09 0.13 0.41 0.51 1.12 1.20 1.49 3.18
3.50 6.36 7.83 8.92 10.13 12.99 16.40

• Compute the mean, median, and standard deviation.

• Find the coefficient of skewness using Pearson’s estimate
and the software methods.
• What is your conclusion regarding the shape of the
distribution?

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 Skewness 4

• Example continued Earnings per

(x − x¯) ÷ s ((x − x¯) ÷ s)3
Share
• Mean: 𝑥lj = 4.95 Median: 3.18 0.09 −0.9310 −0.8070
• Standard deviation: 𝑠 = 5.22 013 −0.9234 −0.7873
0.41 −0.8697 −0.6579
3 𝑥lj − Median
• 𝑘
𝑠 = 0.51 −0.8506 −0.6154
𝑠 1.12 −0.7337 −0.3950
1.20 −0.7184 −0.3708
3 4.95 −3.18 In the following table, read ‘(x − x¯) ÷ s’ as x
= = 1.02 1.49 x bar divided by s;
minus −0.6628
‘((x − x¯) ÷ s)3’ as (x−0.2912
5.22 minus x bar divided by s) to the power of 3
3.18 −0.3391 −0.0390
3.50 −0.2778 −0.0214
3
𝑛
𝑥 − 𝑥lj 6.36 0.2701 0.0197
• 𝑠𝑘 = ෍ 7.83 0.5517 0.1679
𝑛−1 𝑛−2 𝑠
8.92 0.7605 0.4399
15
= (11.8274 ) = 0.975 10.13 0.9923 0.9772
(15 − 1)(15 − 2 ) 12.99 1.5402 3.6539
16.40 2.1935 10.5537
• Skewed right.
11.8274
• Note the mean > median.

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 Skewness 5

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 Describing the Relationship Between Two
Variables 1

Scatter Diagram Graphical technique used to show the

relationship between two variables measured with interval or
ratio scales.
• Study the relationship between two variables (bivariate).
• Usually one variable on the other.

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 Describing the Relationship Between Two
Variables 2

Compute a statistic called the correlation coefficient.

Measures the direction and strength of the relationship.

r=
 ( x − x )( y − y )
( n − 1) s y sx
• Ranges from −1.0 to +1.0.
• The closer the coefficient is to −1.0 or +1.0, the stronger
the relationship.
• If r is close to 0.0, we can say that there is no relationship
between the variables.
• Positive indicates a positive relationship.
• Negative indicates a negative relationship.
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 Describing the Relationship Between Two
Variables 3

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 Describing the Relationship Between Two
Variables 4

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 Describing the Relationship Between Two
Variables 5

• Example: The relationship between vehicle profit and age.

• The correlation is 0.26.

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 Contingency Tables 1

Contingency Table A table used to classify observations

according to two identifiable characteristics.
• It is a cross-tabulation that simultaneously summarizes two
variables of interest.
• Both variables need only be nominal or ordinal.

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 Contingency Tables 2

• Example: The profit for four dealerships.

Contingency Table Showing the Relationship between Profit and Dealership

Above/Below
Median Profit Kane Olean Sheffield Tionesta Total
Above 25 20 19 26 90
Below 11 8 6 5 30
Total 36 28 25 31 120

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 Chapter 4 Practice Problems

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 Question 3 LO4-1

Consider the following chart.

a. What is this chart called?

b. How many observations are in the study?
c. What are the maximum and the minimum values?
d. Around what values do the observations tend to cluster?

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 Question 7 LO4-2

The Thomas Supply Company Inc. is a distributor of gas-

powered generators. As with any business, the length of time
customers take to pay their invoices is important. Listed
below, arranged from smallest to largest, is the time, in days,
for a sample of the Thomas Supply Company Inc. invoices.
13 13 13 20 26 27 31 34 34 34 35 35 36 37 38
41 41 41 45 47 47 47 50 51 53 54 56 62 67 82

a. Determine the first and third quartiles.

b. Determine the second decile and the eighth decile.
c. Determine the 67th percentile.

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 Question 9 LO4-3

The box plot below shows the amount spent for books and supplies
per year by students at four-year public colleges.

a. Estimate the median amount spent.

b. Estimate the first and third quartiles for the amount spent.
c. Estimate the interquartile range for the amount spent.
d. Beyond what point is a value considered an outlier?
e. Identify any outliers and estimate their values.
f. Is the distribution symmetrical or positively or negatively skewed?
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 Question 15 LO4-4

Listed below are the commissions earned ($000) last year by

the 15 sales representatives at Furniture Patch Inc.

$3.9 $5.7 $7.3 $10.6 $13.0 $13.6 $15.1 $15.8 $17.1

17.4 17.6 22.3 38.6 43.2 87.7

a. Determine the mean, median, and the standard deviation.

b. Determine the coefficient of skewness using Pearson’s
method.
c. Determine the coefficient of skewness using the software
method.

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 Question 17 LO4-5,6

Create a scatter diagram and compute a correlation

coefficient. How would you describe the relationship between
the values?

x-Value y-Value x-Value y-Value

10 6 11 6
8 2 10 5
9 6 7 2
11 5 7 3
13 7 11 7

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 Question 19 LO4-7

The Director of Planning for Devine Dining Inc. wishes to study the relationship
between the time of day a customer dined and whether the guest orders dessert.
To investigate the relationship, the manager collected the following information on
200 recent customers.
Time of Day

Dessert Ordered Lunch Dinner Total

Yes 32 85 117
No 68 15 83
a. What is the level of measurement of Total 100 100 200
the two variables?
b. What is the above table called?
c. Does the data suggest that customer are more likely to order dessert? Explain
why.
d. Does the data suggest that customers at lunch time are more likely to order
dessert? Explain why.
e. Does the data suggest that customers at dinner time are more likely to order
dessert? Explain why.
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