FORMULAE SHEETS FOR TESTS AND EXAM

DESCRIPTIVE STATISTICS
DATA MEASURE Population Sample
N
1 1 n
Mean 
N
x
i 1
i x  xi
n i 1

1  n 2 1 n  
N 2
1
  x     xi    xi  
2
Raw data Variance
2
i s 
2

N i 1 n  1  i 1 n  i 1  

 s
CV CV   100% CV  100%
 x
N
1 1 n
Mean 
N
 xi fi
i 1
x  xi fi
n i 1

1  n 2  
2
Grouped 1 N
1 n
2    xi    fi  i i  i i  
2
Variance s2  x f  x f
discrete data N i 1 n  1  i 1 n  i 1  

 s
CV CV   100% CV  100%
 x
N
1 1 n
Mean 
N
 mi fi
i 1
x  mi fi
n i 1
Grouped
1  n 2  
2
1 N
1 n
2    mi    fi  i i  i i  
2
continuous Variance s2  m f  m f
N i 1 n  1  i 1 n  i 1  
data
 s
CV CV   100% CV  100%
 x

CORRELATION AND REGRESSION

2 2
n
1 n  1 n 
n n
1  n  n 
SS X   x    xi 
2
i SS Y   y    yi  2
i
SPXY   xi yi    xi   yi 
i 1 n  i 1  i 1 n  i 1  i 1 n  i 1  i 1 

a  y  bx
SP
b  XY 1 n 1 n  Ŷ  a  bX
SS X  
n i 1
yi  b   xi 
 n i 1 
SPXY
r
 SS X  SS Y 

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TIME SERIES ANALYSIS
At  aYt  1  a  At 1
Exponential smoothing Brown’s method
Fn  k  An

Additive model Yt  Tt  St   t
Decomposition
methods
Multiplicative model Yt  Tt St  t

PROBABILITY
Basic axiom
0  P  A  1
Complement rule
P  A   1  P  A

Addition rule
P  A  B   P  A  P  B   P  A  B 

P  A  B   P  A  P  B  , if and only if A and B are mutually exclusive

Intersection rule
P  A  P  A  B   P  A  B 

De Morgan’s rule
P  A  B  P  A  B  and P  A  B  P  A  B 

Conditional probability
P  A  B
P  A | B 
P  B

Multiplication rule
P  A  B   P  A  P  B | A  P  B   P  A | B 
Statistical independence
P  A  B   P  A  P  B  , if and only if A and B are independent
Bayes’ Theorem with two
P  B | A P  A
P  A | B 
events A and B P  B | A P  A  P  B | A  P  A 

Bayes’ Theorem with three

events A1 , A2 and A3 , P  B | A1  P  A1 
P  A1 | B  
P  B | A1  P  A1   P  B | A2  P  A2   P  B | A3  P  A3 
where A1  A2  A3  S

202
RANDOM VARIABLES AND THEIR PROBABILITY DISTRIBUTIONS

Measures of Central Tendency

Mean   E  X    xp ( x) , for X discrete

Median 1
P  X  m 
(m) 2
Value with the largest probability ( X discrete)
Mode ( m0 )
Value corresponding to highest point of f ( X continuous)

Measures of Dispersion / Spread / Variability

Var  X   E  X 2    2
Variance
E  X 2    x 2 p( x)

Properties of Selected Probability Distributions

Pmf / Pdf / Cdf Range of X Parameter(s) Expected Value Variance
n
p  x     p x qn x
Binomial  x x  0,1, , n n, p np npq
q  1 p

e  x
Poisson p  x  x  0,1, 2,    
x!
f  x    e  x 1 1
2
Exponential x0   
F  x   1  e x  

Normal Z-tables   x    , 2  2

CHI-SQUARED TEST OF INDEPENDENCE

 row i total  column j total 
Expected value / frequency eij 
sample size
Null hypothesis H0: The two variables are independent of one another

 O  E 2
2  
over all cells E
Test statistic
O  Observed frequency
E  Expected frequenct

203
CONFIDENCE INTERVALS AND HYPOTHESIS TESTING

204