# Lecture Data ans statistics Applications in Business and Economics

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Lecture 1

 Lecture 1. Data ans statistics Applications in Business and Economics In today’s global business and economic environment, anyone can access vast amounts of statistical information. The most successful managers and decision makers understand the information and know how to use it effectively. In this section, we provide examples that illustrate some of the uses of statistics in business and economics. Accounting Public accounting firms use statistical sampling procedures when conducting audits for their clients. For instance, suppose an accounting firm wants to determine whether the amount of accounts receivable shown on a client’s balance sheet fairly represents the actual amount of accounts receivable. Usually the large number of individual accounts receivable makes reviewing and validating every account too time-consuming and expensive. As common practice in such situations, the audit staff selects a subset of the accounts called a sample. After reviewing the accuracy of the sampled accounts, the auditors draw a conclusion as to whether the accounts receivable amount shown on the client’s balance sheet is acceptable. Finance Financial analysts use a variety of statistical information to guide their investment recommendations. In the case of stocks, the analysts review a variety of financial data including price/earnings ratios and dividend yields. By comparing the information for an individual stock with information about the stock market averages, a financial analyst can begin to draw a conclusion as to whether an individual stock is over- or underpriced. For example, Barron’s (February 18, 2008) reported that the average dividend yield for the 30 stocks in the Dow Jones Industrial Average was 2.45%. Altria Group showed a dividend yield of 3.05%. In this case, the statistical information on dividend yield indicates a higher dividend yield for Altria Group than the average for the Dow Jones stocks. Therefore, a financial analyst might conclude that Altria Group was underpriced. This and other information about Altria Group would help the analyst make a buy, sell, or hold recommendation for the stock. Yüklə 260,32 Kb.Dostları ilə paylaş:

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