How our life gets affected by statistics? Are we aware of it?

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Statistics is always following you whether you are aware of it or not.

Statistics is in action even in your kitchen, while cooking rice we will press 3-4 grains of rice between our figures to take decision about the whole pot of rice. There we can’t test each and every grain in the cooking pot.

Even it is working when you are shopping, we will break one or two walnuts before buying few kilograms of it. We can’t break open all walnuts we want to buy.

It even decides the fate of our country, have you ever wonder how opinion polls predicts the winner of the election? It is just not possible to interview the entire population hence, a large random sample of people are selected and interviewed. Based on the analysis of the sample data, opinion predicts the winner. Everywhere you would encounter statistics whether you like it or not. Our starting salary, bonus, increment etc. all is influenced by statistics. Bank’s interest rate, inflation, stock market etc. works on statistics. Finally you will die rich or poor based on the average wealth you accumulated with respect to others. Even after death people will remember that you lived longer than the average life span of a human.

Statistics helps us in taking confident decisions when we have limited information or when can’t get all the information required.

All of us must have experienced the theory of probability in high school. Say we have a bucket full of twelve red and thirteen blue balls, now we draw a sample of three balls one after another and now I want to know the probability of withdrawing three consecutive red balls[1]. Here we have information about the population’s (bucket) composition and based on that we are trying to guess the characteristic of the sample.

Picture1In real world, the information about the population is difficult to obtained due to resource constrains[2]. Let’s try to figure out the average height of all the people in the country. Is it possible to approach each and every individual in the country with measuring tape? It’s just not feasible. Instead, the height of a large sample of people across the country are collected and based on the average height of the sample thus collected, we try to estimate the average height of the whole population, obviously with some margin of error.

This is statistics where we take sample and analyze it to predict the characteristics of the population but with some margin of error. It’s just works in opposite way to probability.

Picture2

Now we can understand the manufacturing atmosphere where we can take decision on accepting a production lot based on the analysis of a sample.

Picture2A


[1] Probability of drawing three consecutive red balls = 12/25*11/24*10/23

[2] That’s why population census is conducted every 10 years, not every year as is involves reaching out to every individual in the country.

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