Business Statistics

162 Business Statistics

5.1 INTRODUCTION TO PROBABILITY

We have understood the difference between descriptive and inferential statistics. The study of prob-

ability provides a basis for inferential statistics. Inferential statistics involves sample selection, com-

puting sample statistic on the basis of the concerned sample, and then inferring population parameter

on the basis of the sample statistic. We do this exercise because population parameter is unknown.

We try to estimate the unknown population parameter on the basis of the known sample statistic. This

procedure works on uncertainty. By applying some dened statistical rules and procedures ...