guide to using excel 2007 or 2010 for basic statistical applications to accompany business...
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Guide to Using Excel 2007 or 2010 For Basic Statistical Applications
Guide to Using Excel 2007 or 2010 For Basic Statistical Applications
To AccompanyTo Accompany
Business Statistics: A Decision Making Approach, 7th Ed.
Chapter 5:Chapter 5:
Discrete Probability DistributionsDiscrete Probability Distributions
ByBy
Groebner, Shannon, Fry, & SmithGroebner, Shannon, Fry, & SmithPrentice-Hall Publishing CompanyPrentice-Hall Publishing Company
Copyright, 2008Copyright, 2008
Chapter 5 Excel Chapter 5 Excel ExamplesExamples
Binomial Mean - Catalog SalesCatalog Sales
Poisson Distribution – Heritage TileHeritage Tile
More Examples
Binomial Mean-Catalog Sales
Binomial Mean-Catalog Sales
Issue: People who order items from catalogs Issue: People who order items from catalogs can return the items for a refund. Historical can return the items for a refund. Historical return rate for one catalog has been 11 percent. return rate for one catalog has been 11 percent. Is this rate still valid?Is this rate still valid?
Objective: Use Excel 2007 or 2010 to compute Objective: Use Excel 2007 or 2010 to compute binomial probabilities based on a sample of 300 binomial probabilities based on a sample of 300 purchases.purchases.
Situation:
• Sample Size is n=300
• p = .11
• Mean = np = 300(.11) = 33
• 44 returns were observed
• P(X > 44) = 1 – P(X < 43)
• Find P(X < 43) = ?
Binomial Mean – Catalog Sales
Binomial Mean – Catalog Sales
•Select Formulas tab
•Select More Functions
•Select Statistical
•Select BINOMDIST
Enter values:
Note:
•True = cumulative probability.
•False = exact probability
Binomial Probability Result
Binomial Mean – Catalog Sales
Poisson DistributionHeritage Title
Poisson DistributionHeritage Title
Issue: The distribution for the number of Issue: The distribution for the number of defects per tile made by Heritage Tile is Poisson defects per tile made by Heritage Tile is Poisson distributed with a mean of 3 defects per tile. The distributed with a mean of 3 defects per tile. The manager is worried about the high variabilitymanager is worried about the high variability
Objective: Use Excel 2007 or 2010 to generate Objective: Use Excel 2007 or 2010 to generate the Poisson distribution and histogram to the Poisson distribution and histogram to visually see spread in the distribution of visually see spread in the distribution of possible defects.possible defects.
Poisson Distribution – Heritage Tile
Enter values zero through 10
Poisson Distribution – Heritage Tile
Select Formulas, More Functions, Statistical and
POISSON
Poisson Distribution – Heritage Tile
Enter:
a1, 3, false
Poisson Distribution – Heritage Tile
Notice that I had pre-selected Cell B1.
When I pressed enter the Poisson Probability was loaded into that cell.
Simply copy and paste Cell B1 into cells B2 : B11
Poisson Distribution – Heritage Tile
•Select the Insert tab
•Select Column
•Select the chart type that you want
Poisson Distribution – Heritage Tile
Format the chart as per Chapter 2
Creating A Binomial TableCreating A Binomial Table
Issue: The binomial tables in this text contain Issue: The binomial tables in this text contain specific probabilities for certain values of n and p. specific probabilities for certain values of n and p. You may need to have more extensive tables.You may need to have more extensive tables.
Objective: Use Excel 2007 or 2010 to generate the Objective: Use Excel 2007 or 2010 to generate the Binomial table for n = 25 and p value of .01 to .50 in Binomial table for n = 25 and p value of .01 to .50 in increments of .01increments of .01
Creating A Binomial Table
•Sample size in Cell B1
•p-values in Row 2
•x-values in Column B
Creating A Binomial Table
P(x =0) = .777821 for n = 25, p = .01
Notice the use of absolute cell referencing – this allows you to copy the function across and down to complete this section of the binomial table
Creating A Binomial Table
Copy the contents (formula) of Cell C3 over the entire table
Creating A Binomial Table
Clear all Cells with a value of Zero
Creating A Binomial Table
Repeat for the next set of values for p: 0.11, 0.12 … 0.20
Simply change the contents of Row 2.
Continue this for all possible values of p.
For different sample sizes (n) change Cell B1 and Row B
Creating A Poisson TableCreating A Poisson Table
Issue: The Poisson tables in this text contain Issue: The Poisson tables in this text contain specific probabilities for certain values of specific probabilities for certain values of λλtt . . You may need to have more extensive tables.You may need to have more extensive tables.
Objective: Use Excel 2007 or 2010 to generate Objective: Use Excel 2007 or 2010 to generate the Poisson Table table for the Poisson Table table for λλtt = 6.0 to 7.0 in = 6.0 to 7.0 in increments of .10increments of .10
Creating A Poisson Table
λt values in row 2
Values of x in column A
Creating A Poisson Table
P(x = 0) for λt = 6.0 equals .00248
Notice the use of absolute cell referencing this allows you to copy the function across and down to complete this section of the binomial table
Creating A Poisson Table
Continue this process for other λt values as desired. As λt increases, the possible values for x will have to increase.