Statistics surround us, whether graphing data, calculating probability, finding a relationship between variables, or testing a claim. In the age of the Internet, it is important to learn to think critically about data and information.
Here are 6 points to consider when trying to master basics of statistics:
Statistics and its Importance – Why statistics? Because statistics helps us draw meaning from data, be it in medicine, science, economics, politics, sports, or other fields. Statistical skills are in heavy demand in an increasingly data-driven world.
Identify Different Types of Data – To confidently navigate through many formulas and functions of statistics, know what type of data you are dealing with. There are two basic types: Quantitative (numerical) and Qualitative (categorical). Subdivide quantitative data into Discrete and Continuous. Once you know your data, you will know which formula and function to use.
Persevere with Probability – Probability, the study of chance, is a powerful tool to deal with life’s uncertainties. It is also the workhorse of statistics. Probability can range in value from 0 (impossible) to 1 (certain), and is often calculated as a relative frequency or proportion. Need to know: Laws of probability, conditional probability and calculating probability under various assumptions.
Deconstruct Distributions – Focus on five basic statistical distributions in the beginning: Frequency, Probability, Binomial, Normal and Chi-Square. Understand the purpose and use of each. Normal (also known as Bell-shaped or Gaussian) distribution is the dominant one, so solve problems based on it. Know the significance of the Central Limit Theorem and the Law of Large Numbers.
Draw Meaning from Data – Inferential statistics take up the bulk of basic statistics. Construct confidence intervals and perform hypothesis tests. Understand the assumptions and interpretations of each. Recognize that mean and standard deviations deal with numerical data while proportions deal with categorical data. Chi-Square tests extend the scope of the usual tests of proportions.
Focus on Real-World Problems – The power of statistics comes from its application to real-world problems. Does the low-fat diet work? How does Amazon know which book I am likely to buy, or Netflix which movie I am likely to watch? Which medicine works better to prevent heart attacks? How does the IRS flag potential tax-cheats? Statistical problems deal with real-life issues, from birth to death. There is nothing abstract about them. That’s what makes statistics relevant and important.