CHAPTER 1 INTRODUCTION

I. Choose the correct Answers (each question carries 1 mark)

1. If you are in job, you are working for payment, you are called
(a) Unemployed (b) Leader (c) Employee (d)Trustee
Ans.: (c) Employee
2. Scarcity is the root of
(a) All economic problems (b) Social problems (c) Political problems (d) All problems
Ans.:(a) All economic problems
3. The long queues at railway station, bus-stand, cinema theatres are all manifestations of
(a) Publicity (b) Scarcity (c) Plenty (d) Quantity
Ans.: (b) Scarcity
4. Alternative uses of resources give rise to the problem of
(a) Rights (b) Price (c) Choice (d) Chance
Ans.: (c) Choice
5. This subject is mainly around the study of mankind in the ordinary business of life
(a) History (b) Economics (c) Political Science (d) Sociology
Ans.: (b) Economics

II. Fill in the blanks (each question carries 1 mark)

1. When you buy goods, you are called a _______.
Ans. Consumer
2. When you produce goods, you are called a _______.
Ans.: Producer
3. When you sell goods for profit, you are called a _______.
Ans.: Seller
4. Resources are limited, but wants are _______
Ans. Unlimited
5. Data, numbers, equations are being used in ______
Ans.: Statistics

III. Answer the following questions in a word/sentence (each question carries 1 mark)
1. What is economics according to Alfred Marshall?
Ans.: According to Alfred Marshall ‘’Economics is the study of man in the ordinary business of life’’
2. What are economic data?
Ans.: Economic facts expressed in numbers are called economic data.
3. The National income divided into wages, profit, rent, and interest. What it is called?
Ans.: The National income divided into wages, profit, rent, and interest is called Distribution.
4. What is Statistics?
Ans.: Statistics is the study of numerical facts systematically collected.

IV. Answer the following questions in about four sentences (each question carries 2 mark)
1. Generally, in which 3 parts economics is discussed?
Ans.: Consumption, production, and distribution are the 3 parts in which economics is discussed.
2. Mention the differences between employee and employer.
Ans.: An employee is a person who is in a job and working for some other person for which he gets
payment in the form of wages or salary. An employer is a person who hires others for work and
makes payment for their work in the form of wages or salary.
3. Mention any two scarcities in your daily life.
Ans.: Food, Cloth, Housing, Railway tickets, Bus tickets, etc.
4. Write any two resources which have alternative uses.
Ans.: Water, Electricity, wooden log, money, food, cloth, etc.

V. Answer the following questions in about twelve sentences (each question carries 4 mark)
1. “We are not lucky as Aladdin in real life’’. Elucidate this statement.
Ans. A person by name Aladdin was a lucky person. He had a Magic Lamp. Whenever and whatever
he wants he just had to rub his magic lamp on. A genie (angel) appears and fulfils his wish. So that
he can fulfill all his wants. Like Aladdin we have unlimited wants, but we do not have Magic Lamp
to make the angel to help us to satisfy our wants. For example, if we have enough pocket money to
satisfy our unlimited wants we could have purchased almost all the things we wanted. But since
our pocket money is limited, we have to choose only those things that we want the most. This is a
basic teaching of Economics.
2. “Scarcity is the root of all economic problems.’’ Explain the statement.
Ans.: Scarcity is the root of all economic problems. Had there been no scarcity, there would have
been no economic problem. And we would not have studied economics either. In our daily life, we
face various forms of scarcity. The long queues at railway booking counters, crowded buses and
trains, shortage of essential commodities, the rush to get a ticket to watch a new film, etc., are all
manifestations of scarcity. We face scarcity because the things that satisfy our wants are limited in
availability. The resources which the producers have are limited and also have alternative uses.
Take the case of food that we eat every day. It satisfies our want of nourishment. The resources
used by the farmers to produce food crops such as land, labour, water, fertiliser, etc are given and
are of alternative uses. These resources can also be used to produce non-food crop such as rubber,
cotton, jute, etc. Thus the alternative uses of the resources gives rise to the problem of choice
between different commodities that can be produced by those resources.
3. Briefly explain how statistics helps to study economics.
Ans.: Statistics is an indispensable tool for an economist that helps him to understand an economic
problem, identify the causes of economic problem and formulate certain policies to tackle it. The
importance of statistics are as follows:
1. Statistics enables economist to present economic facts in a precise and definite form. When
economic facts are expressed in statistical terms, they become exact. The exact facts are more
convincing than vague statements.
2. Statistics also helps in condensing mass data into a few numerical measures. Statistical tools
help economists to summarize numerical data in a meaningful way which are easy to remember.
3. Statistics is used in finding relationships between different economic factors. Statistics helps
an economist to find out the cause and effect relationships between economic variables. Example,
relationship between demand and price, consumption and income, production and cost, etc.
4. Statistics helps to forecast the future. Statistics helps an economist to forecast the changes in
dependent variable due to change in independent variable. Example, by using statistical tools an
economist can predict today’s investment on the national income in future.
5. Statistics helps economist and the government to formulate the plans and policies. To solve
any economic problem the government needs to formulate plans and policies for which an
economist can advice the government only by knowing future trends with the help of present
data.
4. “Statistical methods are no substitute for common sense’’! Explain with the example.
Ans.: This statement can be explained with the help of an interesting story which is told to make
fun of statistics. It is said that a family of four persons (husband, wife, and two children) once set
out to cross a river. The father knew the average depth of the river. So he calculated the average
height of his family members. Since the average height of his family members was greater than the
average depth of the river, he thought they could cross safely. Consequently some members of the
family drowned while crossing the river. This proves that “Statistical methods are no substitute for
common sense’’.
 CHAPTER 2 COLLECTION OF DATA

I. Choose the correct Answers (each question carries 1 mark)

1. Which method of collection of data gives better results?
(a) Census (b) Sample Survey (c) Innovation (d) Distribution
Ans.: (a) Census
2. Which of the following error is more serious?
(a) Sampling error (b) Non-sampling error (c) Data error (d) Calculation error
Ans.: (b) Non-sampling error
3. The method of collection of data in which reactions can be watched is
(a) Telephone interview (b) Mailing questionnaire
(c) Personal interview (d) E-mail
Ans.: (c) Personal interview

II. Fill in the blanks (each question carries 1 mark)

1. Data collected by the investigator is called _______.
Ans. Primary data
2. The method of interview in obtaining information at a shorter time is _______.
Ans.: Telephone interview
3. Most expensive method of interview is _______.
Ans.: Personal interview
4. The method of data collection which cannot be used by illiterates are _______.
Ans.: Mailing Questionnaire
5. Census of India is carried out once in ______ years.
Ans.: 10 years

III. Match the following (total 5 marks).

1. Personal interview (a) Pre-testing of questionnaire
2. Mailing questionnaire (b) Covers every individual
3. Telephone interview (c) Loss of questionnaire
4. Pilot survey (d) Cheaper or relatively low cost
5. Census (e) More expensive
Ans.: 1-e, 2-c, 3-d, 4-a, 5-b

IV. Answer the following questions in a word/sentence (each question carries 1 mark)
1. What is a variable?
Ans.: A variable is anything which can take different values in different situations.
2. Write the meaning of census.
Ans.: Census is a survey which covers every element of the statistical population.
3. What is sample survey?
Ans.: Sample survey is a method of collecting data from a selected group or section of the
statistical population.
4. Give the meaning of sampling error.
Ans.: Sampling error is the numerical difference between the estimate and the true value of the
parameter.
5. Expand NSSO.
Ans.: National Sample Survey Organisation.
6. Expand CSO.
Ans.: Central Statistical Organisation.
7. Expand DGCIS.
Ans.: Directorate General of Commercial Intelligence and Statistics.

V. Answer the following questions in about four sentences (each question carries 2 mark)
1. Mention the two sources of data.
Ans.: The sources of data are Primary Data and Secondary Data.
2. Write any two qualities of a good questionnaire.
Ans.: The qualities of a good questionnaire are (any two)
a. The questionnaire should not be too long.
b. The series of questions should move from general to specific.
c. The questions should be precise and clear.
d. The questions should not be ambiguous.
e. The questions should not use double negatives.
f. The question should not give clue of answer to questions.
g. The question should not indicate alternatives to the answer.
h. The questionnaire may consist of closed ended questions or open ended
questions.
3. Mention the methods of collecting data.
Ans.: Personal interview, Mailing Questionnaire, Telephonic interview are the methods of
collecting data.
4. Write the differences between Census and Sample Survey. .
Ans.:

Census Survey Sample Survey

1. It covers every element of the statistical 1. It covers a selected group or section of the
population statistical population
2. It is expensive 2. It is cheaper
3. There is chance of inaccurate information 3. More accurate information
4. It is time consuming 4. It takes less time

5. Name the two methods of selecting samples in Random Sampling?

Ans. Lottery method and use of random table are the two methods of selecting samples in
Random Sampling.
6. Give the meaning of Pilot Survey.
Ans.: Pilot survey is a way of pre-testing the questionnaire with a small group of people. This
helps in providing a preliminary idea about the survey. And also helps the investigator to
overcome the shortcomings and drawbacks of the questions.

VI. Answer the following questions in about twelve sentences (each question carries 4 mark)
1. Does the lottery method always give you a random sample? Explain.
Ans. Yes, lottery method always give you a random sample. Random sampling is one where the
individual units from the population (samples) are selected at random. In the random sampling,
every individual has an equal chance of being selected and the individuals who are selected are
just like the ones who are not selected. If a sample has to be selected randomly under lottery
method, then the names of all statistical population has to be written on pieces of paper and
mixed well. Then we need to pick up the required number of chits. Here each and every unit of
the statistical population has the equal chance of getting selected. For example, suppose the
government wants to determine the impact of the rise in petrol price on the household budget
of a particular locality. For this, a representative (random) sample of 30 households has to be
taken and studied. The names of all the 300 households of that area are written on pieces of
paper and mixed well, then 30 names to be interviewed are selected one by one. In this
example, all the 300 sampling units (also called sampling frame) of the population got an equal
chance of being included in the sample of 30 units and hence the sample, such drawn, is a
random sample.

2. Briefly explain Sampling errors.

Ans.: The purpose of the sample is to take an estimate of the population. Sampling error refers
to the differences between the sample estimate and the actual value of a
characteristic of the population (that may be the average income, etc.). It is the error that
occurs when we make an observation from the sample taken from the population. Thus, the
difference between the actual value of a parameter of the population (which is not known) and
its estimate (from the sample) is the sampling error. It is possible to reduce the magnitude of
sampling error by taking a larger sample. For example, consider a case of incomes of 5 farmers
of Manipur. The variable X (income of farmers) has measurements 500, 550, 600, 650, 700. We
note that the population average of (500+550+600+650+700) ÷ 5 = 3000 ÷ 5 = 600. Now,
suppose we select a sample of two individuals where X has measurements of 500 and 600. The
sample average is (500 + 600) ÷ 2 = 1100 ÷ 2 = 550. Here, the sampling error of the estimate =
600 (true value) – 550 (estimate) = 50.

3. What is Random Sampling? Explain briefly.

Ans.: As the name suggests, random sampling is one where the selection of units is done in such
a manner that the chance of selection of each unit of the universe is the same. In other words
the selection of the units depends entirely on chance and one does not know beforehand which
units will actually constitute the sample. Lottery method and using Random Number Table are
the 2 methods of selecting random sample. Under Lottery method the names of each unit is
written on the small chit and after folding them and mixing them together and certain numbers
are selected to constitute a sample by picking chit. In the random sampling, every individual has
an equal chance of being selected and the individuals who are selected are just like the ones
who are not selected. For example, if the government wants to determine the impact of the rise
in petrol price on the household budget of a particular locality. For this, a representative
(random) sample of 30 households has to be taken and studied. The names of all the 300
households of that area are written on pieces of paper and mixed well, then 30 names to be
interviewed are selected one by one. In this example, all the 300 sampling units (also called
sampling frame) of the population got an equal chance of being included in the sample of 30
units and hence the sample, such drawn, is a random sample. The same could be done using a
Random Number Table also. Random number tables have been generated to guarantee equal
probability of selection of every individual unit (by their listed serial number in the sampling
frame) in the population. They are available either in a published form or can be generated by
using appropriate software packages. We can start using the table from anywhere, i.e., from any
page, column, row or point. In this example, we need to select a sample of 30 households out of
300 total households. Here, the largest serial number is 300, a three digit number and therefore
we consult three digit random numbers in sequence. We will skip the random numbers greater
than 300 since there is no household number greater than 300.
4. Write briefly about the census and NSSO.
Ans.: The Census of India provides the most complete and continuous demographic record of
population. The Census is being regularly conducted every ten years since 1881. The first Census
after Independence was held in 1951. The Census collects information on various aspects of
population such as the size, density, sex ratio, literacy, migration, rural-urban distribution etc.
Census in India is not merely a statistical operation, the data is interpreted and analysed in an
interesting manner. The NSSO was established by the government of India to conduct
nation-wide surveys on socioeconomic issues. The NSSO does continuous surveys in successive
rounds. The data collected by NSSO surveys, on different socio economic subjects, are released
through reports and its quarterly journal Sarvekshana. NSSO provides periodic estimates of
literacy, school enrolment, utilisation of educational services, employment, unemployment,
manufacturing and service sector enterprises, morbidity, maternity, child care, utilisation of the
public distribution system etc.
.
VII. Project oriented question (5 marks)
1. Suppose you are a research student and you are asked to conduct a sample survey about the
‘Mid-day meals program’ in schools. Prepare a good questionnaire to support your survey.
Ans.:

Survey on Midday meals program in schools.

1. Name and Address of the School::

2. Name of the Student::
3. Class of study:
4. Do you have mid-day meals in your school Yes/No
5. Do you like to eat mid-day meals in the school Yes/No
6.. Whether cleanliness is maintained while preparing food Yes/No
7. Whether food is provided on time with sufficient quantity Yes/No
8. Are you satisfied about Quality of the Mid-day meal Yes/No
9. If No, give reasons:
10. Any suggestions for improvement
 CHAPTER 3 ORGANIZATION OF DATA

I. Choose the correct answers (each question carries 1 mark). 1)

1. The class midpoint is equal to:
a. The average of the upper and lower class limit
b. The product of upper and lower class limit
c. The ratio of the upper and lower class limit
d. None of the above
Ans.: a. The average of the upper and lower class limit.
2. The frequency distribution of two variables is known as
a. Univariate classification b. Bivariate classification
c. Multivariate classification d. None of the above
Ans.: b. Bivariate classification
3. Statistical calculations in classified data are based on
a. The actual values of observations b. The upper class limits
c. The lower class limits d. The class midpoints.
Ans.: d. The class midpoints.
4. Under exclusive method,
a. The upper class limit of a class is excluded in the class interval
b. The upper class limit of a class is included in the class interval
c. The lower class limit of a class is excluded in the class interval
d. The lower class limit of a class is included in the class interval
Ans.: a. The upper class limit of a class is excluded in the class interval
5. Range is the
a. Difference between the largest and the smallest values of a variable
b. Average of the largest and the smallest observation
c. Ratio of the largest to the smallest values of a variable
d. None of the above
Ans.: a. Difference between the largest and the smallest values of a variable

II. Fill in the blanks (each question carries 1 mark).

1. Data classified according to geographical areas is called _____________.
Ans.: Spatial Classification
2. Classification of data according to characteristics and attributes is called _____________
Ans.: Qualitative Classification
3. Two ends of a class are called ___________.
Ans.: Class Limits
4. ____________is the average of upper and lower limit of a class.
Ans.: Class Midpoint
5. In __________ method of classification upper limit of a class is included.
Ans. Exclusive method
6. Frequency distribution of discrete frequency is called___________.
Ans.: Frequency Array

III. Answer the following questions in a word / sentence (each question carries 1 mark).
1. What is raw data?
Ans.: Unclassified data or disorganized is called as raw data.
2. What is quantitative classification of data?
Ans.: The data grouped or classified with reference to quantitative nature like age, income,
marks of students, etc. are called quantitative in nature.
3. What do you mean by qualitative classification of data?
Ans.: The data grouped or classified with reference to qualities or attributes like nationality,
literacy, religion, gender, marital status, etc. is called as qualitative classification of data.
4. Give the meaning of class limits?
Ans.: The two ends of a class are called class limits
5. What is univariate frequency distribution?
Ans.: The frequency distribution of a single variable is called a Univariate Distribution.
6. Give the meaning of time series data?
Ans.: Classification of data either in ascending or in descending order with reference to time
such as years, quarters, months, weeks, etc. is called time series data or chronological
classification of data.
7. What is spatial classification of data?
Ans.: The data grouped or classified with reference to geographical locations such as countries,
states, cities, districts, etc

IV. Answer the following questions in about four sentences (each question carries 2 marks)
1. Mention the types of variable.
Ans.: Continuous variable and discrete variable are the types of variable.
2. Differentiate between inclusive and exclusive methods of classification.
Ans.: Under Continuous method the classes are formed in such a way that the upper class limit of
one class equals the lower class limit of the next class. The upper class limit is excluded but the
lower class limit of a class is included in the interval. But under exclusive method, the Inclusive
Method includes the both upper limit and lower limit of the class interval in the class. Thus both
class limits are parts of the class interval.
3. Mention the types of classification of data.
Ans.: The types of classification of data are
i. Chronological Classification
ii. Spatial Classification
iii. Quantitative Classification
iv. Qualitative Classification
4. Give the formula to find out midpoint.
Ans.: Class Mid-Point or Class Mark = (Upper Class Limit + Lower Class Limit)/2
5. What is frequency?
Ans.: Class Frequency means the number of values in a particular class.

V. Answer the following questions in about twelve sentences (each question carries 4 marks)
1. Briefly explain ‘loss of information’ in classified data.
Ans.: The classification of data as a frequency distribution has an inherent shortcoming. While it
summarises the raw data making it concise and comprehensible, it does not show the details
that are found in raw data. There is a loss of information in classifying raw data though much is
gained by summarising it as a classified data. Once the data are grouped into classes, an
individual observation has no significance in further statistical calculations. For example, the
class 20–30 contains 6 observations: 25, 25, 20, 22, 25 and 28. So when these data are grouped
as a class 20–30 in the frequency distribution, the latter provides only the number of records in
that class (i.e. frequency = 6) but not their actual values. All values in this class are assumed to
be equal to the middle value of the class interval or class mark (i.e. 25). Further statistical
calculations are based only on the values of class mark and not on the values of the
observations in that class. Thus the use of class mark instead of the actual values of the
observations in statistical methods involves considerable loss of information.
2. Differentiate between continuous and discrete variables.
Ans,: Different variables vary differently and depending on the way they vary, they are broadly
classified into two types:
( i ) Continuous and
( i i ) Discrete.
i. Continuous variable: A continuous variable can take any numerical value. It may take
integral values (1, 2, 3, 4, ...), fractional values (1/2, 2/3, 3/4, ...), and values that are not exact
fractions ( 2=1.414, 3 =1.732, … , 7 =2.645). For example, the height of a student, as he/she
grows say from 90 cm to 150 cm, would take all the values in between them. It can take values
that are whole numbers like 90 cm, 100 cm, 108 cm, 150 cm. It can also take fractional values
like 90.85 cm, 102.34 cm, 149.99 cm etc. that are not whole numbers. Thus the variable “height”
is capable of manifesting in every conceivable value and its values can also be broken down into
infinite gradations. Other examples of a continuous variable are weight, time, distance, etc.
Ii. Discrete variable: A discrete variable can take only certain values. Its value changes only by
finite “jumps”. It “jumps” from one value to another but does not take any intermediate value
between them. For example, a variable like the “number of students in a class”, for different
classes, would assume values that are only whole numbers. It cannot take any fractional value
like 0.5 because “half of a student” is absurd. Therefore it cannot take a value like 25.5 between
25 and 26. Instead its value could have been either 25 or 26. What we observe is that as its
value changes from 25 to 26, the values in between them — the fractions are not taken by it..
3. Write a note on Classification of data.
Ans.: The groups or classes of a classification can be done in various ways. The raw data could
be classified in various ways depending on the purpose in hand. The raw data can classified as
follows:
1. Chronological Classification: The classification or grouping of data according to time is called
as Chronological Classification. In such a classification, data are classified either in ascending or
in descending order with reference to time such as years, quarters, months, weeks, etc.
2. Spatial Classification: In Spatial Classification the data are classified with reference to
geographical locations such as countries, states, cities, districts, etc. Example 2 shows the yield
of wheat in different countries.
3. Qualitative Classification: The data classified or grouped according to qualitative
characteristics or Attributes are called Qualitative classification. For example, nationality, literacy,
religion, gender, marital status, etc. They cannot be measured. Yet these attributes can be
classified
4. Quantitative Classification: Data classified or grouped according to characteristics like height,
weight, age, income, marks of students, etc. are quantitative in nature is called Quantitative
Classification.
VI. Answer the following in about twenty sentences (each question carries 6 marks)
1. Prepare a tally marking chart for the marks in economics scored by 70 students in an
examination.
28, 17, 15, 22, 29, 21, 23, 27, 18, 12, 7, 2, 9, 4, 1, 8, 3, 10, 5, 20, 16, 12, 8, 4, 33, 27, 21, 15,
3, 36, 27, 21, 15, 3, 37, 16, 2, 8, 9, 2, 4, 6, 32, 31, 29, 18, 14, 13, 15, 11, 9, 7, 1, 5, 37, 32, 23,
24, 20, 19, 25, 19, 25, 19, 25, 19, 20, 6, 9, 30
Ans.À:
Class Values Tally Frequency Class
Marks Midpoint
0-5 2,4,1,3,4,3,3,2,2,4,1 IIII IIIII 11 2.5
5-10 7,9,8,8,5,8,9,6,9,7,5,6,9 IIII IIIIIII 13 7.5
10-15 12,10,12,14,13,11 IIIII 6 12.5
15-20 17,15,18,16,15,15,16,18,15,19,19,19,19 IIII IIII III 13 17.5
20-25 22,21,23,20,21,21,23,24,20,20 IIII IIII 10 22.5
25-30 28,29,27,27,27,29,25,25,25 IIII IIII 9 27.5
30-35 33,32,31,32,30 IIII 5 32.5
35-40 36,37,37 III 3 37.5
Total 70

2. List the four questions to be addressed while preparing a frequency distribution. Briefly
explain any two of them.
While preparing a frequency distribution from the raw data the following four questions need
to be addressed:
a. How many classes should we have?
b. What should be the size of each class?
c. How should we determine the class limits?
d. How should we get the frequency for each class?
a. How many classes should we have?
Before we determine the number of classes, we first find out as to what extent the variable in
hand changes in value. Such variations in variable’s value are captured by its range. The Range is
the difference between the largest and the smallest values of the variable. A large range
indicates that the values of the variable are widely spread. On the other hand, a small range
indicates that the values of the variable are spread narrowly.. After obtaining the value of range,
it becomes easier to determine the number of classes once we decide the class interval. Note
that range is the sum of all class intervals. If the class intervals are equal then range is the
product of the number of classes and class interval of a single class.
Range = Number of Classes × Class Interval
s. A frequency distribution with too many classes would look too large. Such a distribution is not
easy to handle. So we want to have a reasonably compact set of data. On the other hand, given
the value of range if we choose a class interval that is too large then the number of classes
becomes too small. The data set then may be too compact and we may not like the loss of
information about its diversity.
ii. What should be the size of each class?
The answer to this question depends on the answer to the previous question. The equality (2)
shows that given the range of the variable, we can determine the number of classes once we
decide the class interval. Similarly, we can determine the class interval once we decide the
number of classes. Thus we find that these two decisions are inter-linked with one another. We
cannot decide on one without deciding on the other.
 CHAPTER – 4 PRESENTATION OF DATA

I. Choose the correct answers (each question carries 1 mark).

1. Data are presented in sentences is called
a. Tabular Presentation b. Diagramatic Presentation
c. Textual Presentation d. None of the above
Ans.: c. Textual Presentation
2. A histogram is a
a. One dimensional diagram b. Two dimensional diagram
c. Three dimensional diagram d. four dimensional diagram
Ans.: b. Two dimensional diagram
3. Frequency polygon is used in the presentation of
a. Ungrouped datC b. grouped data c. Both types of data d. none of these
Ans.: b. grouped data
4. Data are expressed in rows and columns is called
a. Pie-chart b. Bar diCgram c. Linear diagram d. Table
Ans.: d. Table
5. Ogives can be helpful in locating graphically the
a. mode b. mean c. median d. none of the above
Ans.: c. median

II. Fill in the blanks (each question carries 1 mark).

1. Arithmetic line graph is also called ___________.
Ans.: Time Series Graph
2. Component Bar diagrams are also called ___________.
Ans.: Subdivided Bar Diagram
3. ____________ of the table contains actual data.
Ans.: Body of the table

III. Answer the following questions in a word / sentence (each question carries 1 mark).
1. What is pie-chart?
Ans.: A circle whose area is proportionally divided among the components is called Pie Diagram
2. What do you mean by frequency polygon?
Ans.: A frequency polygon is a plane bounded by straight lines, usually four or more lines.
3. What is multiple Bar diagram?
Ans. Multiple bar diagrams are used for comparing two or more sets of data.
4. What is table?
Ans.: Data presented in rows and columns along with some explanatory notes is called as Table.

IV. Answer the following questions in about four sentences (each question carries 2 marks)
1. Name any four parts of tabulation.
Ans.: Parts of tabulation are (any Four): i. Table number ii. Table Title iii. Column Headings
v. Row Headings vi. Body of the Table vii. Source of the table viii. Note of the table
 2. What are the types of bar diagram?
Ans.: Types of bar diagram are: i. Simple Bar Diagram ii. Component Bar Diagram or Subdivided
Bar Diagram iii. Multiple Bar Diagram
3. What is component bar diagram? Give the example.
Ans.: Component bar diagrams or charts also called sub-diagrams, are very useful in comparing
the sizes of different component parts (the elements or parts which a thing is made up of) and
also for throwing light on the relationship among these integral parts. For example, sales
proceeds from different products, expenditure pattern in a typical Indian family (components
being food, rent, medicine, education, power, etc.), budget outlay for receipts and expenditures,
components of labour force, population etc. Component bar diagrams are usually shaded or
coloured suitably.
4. How can you obtain a frequency curve?
Ans.: The frequency curve is obtained by drawing a smooth freehand curve passing through the
points of the frequency polygon as closely as possible. It may not necessarily pass through all the
points of the frequency polygon but it passes through them as closely as possible.
5. What kind of diagrams are more effective in presenting the following?
a. Monthly rainfall in a year
Ans.: Arithmatic Graph or line diagram
b. Composition of the population of Delhi by religion
Ans.: Component (Subdivided) Bar diagram
V. Answer the following questions in about twelve sentences (each question carries 4 marks)
1. Draw the format of a table and identify its components.
Ans.:
Table Number Title

Table 4.1 Population of India according to workers and non-workers by gender and location.
Column Headings (in crores)
Unit
Workers
Location Gender Non-Worker Total
Main Marginal Total
Row Headings

Male 17 3 20 18 38
Body of the Table
Rural

Female 6 5 11 25 36
Total 23 8 31 43 74
Male 7 1 8 7 15
Urban

Female 1 0 1 12 13
Total 8 1 9 19 28
Male 24 4 28 25 53
Total

Female 7 5 12 37 49
Total 31 9 40 62 102

Source: Census of India 2001 Source NoteÂ

Note.: FootnoteÂ
2. Draw bar diagram with the help of the following data.
Production of cars of a company in different years.
Years Number of cars
2011 150
2012 250
2013 180
2014 90
2015 300
2016 350
Ans.:

VI. Answer the following in about twenty sentences (each question carries 6 marks)
1. Explain the components of the table.
Ans.: The most simple way of conceptualising a table may be data presented in rows and columns
along with some explanatory notes. A good table should essentially have the following:
(i) Table Number: Table number is assigned to a table for identification purpose. If more than one
table is presented, it is the table number that distinguishes one table from another. It is given at
the top or at the beginning of the title of the table. Generally, table numbers are whole numbers
in ascending order if there are many tables in a book.
(ii) Title: The title of a table narrates about the contents of the table. It has to be very clear, brief
and carefully worded so that the interpretations made from the table are clear and free from any
ambiguity. It finds place at the head of the table succeeding the table number or just below it.
(iii) Captions or Column Headings: At the top of each column in a table a column designation is
given to explain figures of the column. This is called caption or column heading.
(iv) Stubs or Row Headings: Like a caption or column heading each row of the table has to be
given a heading. The designations of the rows are also called stubs or stub items, and the
complete left column is known as stub column. A brief description of the row headings may also
be given at the left hand top in the table.
(v) Body of the Table: Body of a table is the main part and it contains the actual data. Location of
any one figure/data in the table is fixed and determined by the row and column of the table.
(vi) Unit of Measurement: The unit of measurement of the figures in the table (actual data)
should always be stated alongwith the title if the unit does not change throughout the table. If
different units are there for rows or columns of the table, these units must be stated alongwith
‘stubs’ or ‘captions’. If figures are large, they should be rounded up and the method of rounding
should be indicated.
(vii) Source Note: It is a brief statement or phrase indicating the source of data presented in the
table. If more than one source is there, all the sources are to be written in the source note.
Source note is generally written at the bottom of the table.
(viii) Footnote: Footnote is the last part of the table. Footnote explains the specific feature of the
data content of the table which is not self explanatory and has not been explained earlier.

2. The following table shows the Enrollment by gender at schools (%) of children aged 6-14 years
in a district of Bihar. Draw a component bar diagram by using these data.

Gender Enrolled (in %) Drop outs (in %)

Boys 91.5 8.5
Girls 58.6 41.4
All 78.0 22
Ans.:

3. Construct ogive by using the following datas.

Marks (X) Number of
Students (f)
0-20 6
20-40 5
40-60 33
60-80 14
80-100 6
Total 64
Ans.:
Marks (x) Number of Mid Less than More than
Students Point(M) Cumulative Cumulative
(f) Frequency Frequency
(LCF) (MCF)
0-20 6 10 6 64
20-40 5 30 11 58
40-60 33 50 44 53
60-80 14 70 58 20
80-100 6 90 64 6
MlÄÖ 64

4. Draw an arithmetic line graph using following data Value of import and export of India (in 100
crores)
Year Exports Imports
2009-10 8455 13637
2010-11 11370 16835
2011-12 14660 23455
2012-13 16343 26692
2013-14 19050 27154
Ans.:
VII. Project oriented question (5 marks)
1. On the basis of data you have collected regarding participation of women in your locality in
the below mentioned categories construct a pie chart

Status Population
Marginal worker 12
Main worker 36
Non-worker 73

Ans.:

Status Population Per Cent Angular Component

o
Marginal worker 12 9.9 35.7
o
Main worker 36 29.8 107.1
o
Non-worker 73 60.3 217.2
 CHAPTER – 5 MEASURES OF CENTRAL TENDENCY
I. Choose the correct answers (each question carries 1 mark).
1. Five students obtained 10, 20, 30, 40 and 50 marks respectively. What would be the mean?
a) 35 b) 30 c) 25 d) 40
Ans.: b) 30
∑X
� =
2. X is concerned with
N
a) Arithmetic Mean b) Mode c) Median d) Geometric Mean
Ans.: a) Arithmetic Mean
3. The most commonly used measure of central tendency is
a) Mode b) Median c) Arithmetic mean d) Percentile
Ans.: c) Arithmetic mean
4. Which of the following represent Median?
a) Q1 b) Q3 c) Q4 d) Q2
Ans.: d) Q2
5. Percentiles divide the distribution equal into
a) 100 parts b) 75 parts c) 25parts d) 50 parts
a) 100 parts
6. Quartiles are measures which divide the data into
a) 2 equal parts b) 4 equal parts c) 1 equal parts d) 3 equal parts
Ans.: b) 4 equal parts
7. Assign weights to various item according to their importance is called
a) Arithmetic a wean b) median c) weighted Arithmetic mean d) mode
Ans.: c) weighted Arithmetic mean
8. What would be the median wage for the following wages of 5 labourers 10, 20, 30, 35, 38
a) Rs 20 b) Rs 10 c) Rs 35 d) Rs 30
Ans.: d) Rs 30
II. Fill in the blanks (each question carries 1 mark).
1. ________ Arithmetic mean gives relative importance to each item.
Ans: Weighted Arithmetic mean
2. 3rd quartile and ________ percentile are the same.
Ans.:75%
3. There are ________ Quartiles in a series.
Ans.: 3
4. ________ is not affected by the extreme values.
Ans.: Median
5. Most frequently observed value in a series is called ________
Ans.: Mode
6. A distribution with more than two modes is called ________.
Ans.: Multi-Modal
III. Match the following: (total 5 marks).
1. Arithmetic mean a) Positional value
2. Median b) X�
3. ΣN c) Q3
4. Q1, Q2, P25, P50 d) Total number of observations
(𝑁𝑁+1)
5. 3 (e) Divisional values
4
Ans.: 1-b, 2-a, 3-d, 4-e, 5-c
IV. Answer the following questions in a word / sentence (each question carries 1 mark).
1. What is meant by central tendency?
Ans.: The measuring of central tendency is a way of summarising the data in the form of a typical
or representative value.
2. What is the meaning of Arithmetic mean?
Ans.: Arithmetic mean is defined as the sum of the values of all observations divided by the
number of observations and is usually denoted by � X
3. Define median.
Ans.: Median is the “middle” element when the data set is arranged in order of the magnitude.
4. Pocket money of 8 students is Rs 6, 12, 18, 24, 30, 36, 42 and 48 calculate arithmetic mean.
∑X 6+12+18+24+30+36+42+48 216
Ans.: �
X =
N
= 8
= 8
= 27
5. Write the formula for weighted mean.
w1x1 + w2x2 + ......+ wnxn ∑ wx
Ans.: Weighted mean = =
w1 + w2 + ......+ wn ∑w
6. What do you mean by percentiles?
Ans.: Percentiles divide the distribution into hundred equal parts, so you can get 99 dividing
positions denoted by P1, P2, P3, ..., P99.
7. What is Bi-modal?
Ans.: The data with two modes is called bi-modal.
8. Calculate mode from the following data X: 10, 8, 10, 6, 4, 12, 10, 8, 10, 18, 16, 10, 18, 16.
Ans.: In the given data the frequently repeated value of X is 10. So 10 is the mode.

V. Answer the following questions in about four sentences (each question carries 2 marks)
1. What are the types of measures of central tendency?
Ans. Mean, median and mode are the types of measures of central tendency.
2. Calculate arithmetic mean from the following data.
Marks obtained by 10 students 30, 62, 47, 25, 52, 39, 56, 66, 12, 24
∑X
Ans. �X =
N
30+62+47+25+52+39+56+66+12+24
=
10
413
= = 41.3
10
3. Calculate the value of median from the following figures.
X: 5 7 9 12 11 8 7 15 25
Ans.: X: 5, 7, 7, 8, 9, 11, 12, 15, 25
N+1
Median = th item
2
9+1 th
= =5 item = 9
2
4. How do you classify modal series.
Ans. Unimodal, bi-odal and multi-modal are the classes of modal series.
5. What is mode? Give formula to find out mode in continuous series.
Ans.: Mode is the most frequently observed data value. It is denoted by Mo. The formula to find
out mode in continuous series is
D1
M0 = L + ×h
D1 + D2
VI. Answer the following questions in about twelve sentences (each question carries 4 marks)
1. Calculate the arithmetic mean from the following data.
a) Direct method b) Assumed mean method
X 5 10 15 20 25 30 35 40
f 5 7 9 10 8 6 5 2
Ans.:

X f fX d=X-A fd
5 5 25 -20 -100
10 7 70 -15 -105
15 9 135 -10 -90
20 10 200 -5 -50
25 8 200 0 0
30 6 180 5 30
35 5 175 10 50
40 2 80 15 30
Total 52 1065 -235

a) Direct method
∑ fX
� =
X
N
1065
= =20.48
52
b) Assumed mean method
∑ fd
X = A+
�
N
−235
= 25+
52
=25+(-4.52)
= 25 - 4.52 =20.48
2. Define weighted mean? How do you calculate it? Explain.
Ans.: Sometimes it is important to assign weights to various items according to their importance,
when we calculate the arithmetic mean. For example, there are two commodities, mangoes and
potatoes. If we are interested in finding the average price of mangoes (p1) and potatoes (p2) the
arithmetic mean will be (p1 + p2)/2. However, we might want to give more importance to the rise
in price of potatoes (p2). To do this, we may use as ‘weights’ the quantity of mangoes (q1) and the
quantity of potatoes (q2). Now the arithmetic mean weighted by the quantities would be
q1p1 + q2p2
.
q1 + q2
In general the weighted arithmetic mean is given by,
w1x1 + w2x2 + ......+ wnxn ∑ wx
Weighted Arithmetic mean =
w1 + w2 + ......+ wn
=
∑w
.
3. Name and define any three statistical average.
Ans.: Arithmetic mean, median and mode are the three statistical averages.
Arithmetic mean is defined as the sum of the values of all observations divided by the number of
observations and is usually denoted by � X. The simple formula for calculating Arithmetic mean is
as follows
∑ fX
� =
X
N
Median: Median is that positional value of the variable which divides the distribution into two
equal parts, one part comprises all values greater than or equal to the median value and the
other comprises all values less than or equal to it. The Median is the “middle” element when the
data set is arranged in order of the magnitude. The simple formula for calculating median is as
follows
N+1
Median = th item
2
Mode is the most frequently observed data value. It is denoted by Mo. The simple formula for
calculating Mode is as follows:
Mo = most frequently observed data value
4. Calculate median from the following data.

Weight (X) 40 50 60 70 80 90
No. of persons (f) 3 17 24 16 8 2

Ans.:
Weight (X) No. of persons (f) cf
40 3 3
50 17 20
60 24 44
70 16 60
80 8 68
90 2 70

N+1
Median = th item
2
70+1
Median = th item
2
= 35.5th item
= 60
5. Calculate the lower quartile from the following data.
X: 22 26 14 30 18 11 35 41 12 32
Ans.:
X: 11, 12, 14, 18, 22, 26, 30, 32, 35, 41
N = 10
N+1
lower quartile (Q1)= th item
4
10+1
= th item
4
 11
= th itemÀ
4
= 2.75th item
= 12+0.75 x (3rd item – 2nd item)
= 12+0.75 x (14 - 12)
= 12+0.75 x 2
= 12+1.5
= 13.5
VII. Answer the following in about twenty sentences. (Each question carries 6 marks)
1. Calculate arithmetic mean by direct, assumed mean and step deviation methods for the
following data. 40, 50, 55, 78, 58
Ans.:
c=5
A=55
X 𝐝𝐝
d= X-A d’= 𝟓𝟓

40 -15 -3
50 -5 -1
55 0 0
78 23 4.6
58 3 0.6
281 6 1.2

Direct method:
∑X
� =
X
N
40+50+55+78+58
=
5
281
= = 56.2
5
Assumed mean method
∑d
�
X = A+
N
6
= 55+
5
= 55+1.2
= 56.2
Step-Deviation method

∑ 𝐝𝐝’
�X = A +
N
xc
1.2
= 55 +
5
x5
6.0
= 55 +
5
= 55 + 1.2
= 56.2
2. Calculate average marks of the following students using a) Direct method b) step deviation
method.
Marks (X) 0-10 10-20 20-30 30-40 40-50 50-60 60-70 Total
No of students (f) 5 12 15 25 8 3 2 70

Ans.:
c = 10
Marks No of A=35
M fM 𝐝𝐝 fd’
(X) students (f) d= X-M 𝐝𝐝′ =
𝟏𝟏𝟏𝟏
0-10 5 5 25 -30 -3 -15
10-20 12 15 180 -20 -2 -24
20-30 15 25 375 -10 -1 -15
30-40 25 35 875 0 0 0
40-50 8 45 360 10 1 8
50-60 3 55 165 20 2 6
60-70 2 65 130 30 3 6
Total 70 2110 -34

a) Direct methodÀ:
∑ fM
�
X =
N
2110
= = 30.14
70
b) Step-Deviation method:
∑ 𝐝𝐝’
�X = A +
N
xc
−34
= 35 +
70
x 10
−340
= 35 +
70
= 35 + (-4.86)
= 35 – 4.86 = 30.14
3. Find median of the following data.

Wages (Rs.è) (X) No of workers (f)

60-70 7
50-60 21
40-50 11
30-40 6
20-30 5
Ans.:
Wages (Rs.è) (X) No of workers (f) cf
60-70 7 50
50-60 21 43
40-50 11 22
30-40 6 11
20-30 5 5

N
−cf
Median = L +
2
xh
f
𝑁𝑁 50
= = 25
2 2
25 −22
Median = 50 + x 10
21
3
= 50 + x 10
21
30
= 50 +
21
= 50 +1.43
= 51.43
4. Calculate Q1, Q2 and Q3 from the following data.
X: 15, 21, 26, 30, 40, 45, 50, 54, 60, 65, 70
Ans.:
N+1
Q1 = th item
4
11+1
= th item
4
12
= th item
4
= 3 th item
= 26
2(N+1)
Q2 = th item
4
2 x (11+1)
= th item
4
24
= th item
4
= 6th itemÀ
= 45
3(N+1)
Q3 = th item
4
3 x (11+1)
= th item
4
36
= th item
4
= 9th item
= 60
5. Calculate Q1, Q2 and Q3 from the following data.
X: 22, 26, 14, 30, 18, 11, 35, 41, 12, 32
 Ans.: X: 11, 12, 14, 18, 22, 26, 30, 32, 35, 41
N+1
Q1= th item À
4
10+1
= th item À
4
11
= th item
4
= 2.75th item
= 12+0.75 x (3rd – 2nd item)
= 12+0.75 x (14 - 12)
= 12+0.75 x 2
= 12+1.5
= 13.5
2(N+1)
Q2 = th item
4
2 x (10+1)
= th item
4
22
= th item
4
= 5.5th item
5th item + 6th item
=
2
22+26
=
2
48
= = 24
2
3(N+1)
Q3 = th item
4
3 X (10+1)
= th item
4
33
= th item
4
= 8.25th item
= 32+ 0.25 x (9th item – 8th item)
= 32 + 0.25 x (35-32)
= 32 + 0.25 x 3
= 32 + 0.75 = 32.75

6. Find the mode of labour family from following data

Monthly income (*in 000) Cumulative frequency (cf)
Below 50 97
Below 45 95
Below 40 90
Below 35 80
Below 30 60
Below 25 30
Below 20 12
Below 15 4
Ans.:
Monthly income (*in 000) Cumulative frequency (cf) frequency
 45-50 97 2
40-45 95 5
35-40 90 10
30-35 80 20
25-30 60 30
20-25 30 18
15-20 12 8
10-15 4 4

30−18
= 25 + (30−18)+(30−20)
x5
12
= 25 + 12+10
x5
60
= 25 + 22
= 25 + 2.73
= 27.73
VIII. Project oriented question (5 marks)
1. As per recorded temperature per two hours in a day from 6 am to 6 pm, calculate the range and
mean temperature of a day.
Hour Temperature
6-8 18
8-10 24
10-12 26
12-14 29
14-16 30
16-18 25
Ans.:
Hour Temperature
6-8 18
8-10 24
10-12 26
12-14 29
14-16 30
16-18 25
Total 152
∑X
�) =
Average Temperature (X N
152
= 6
= 25.33
Range = L – S
= 30 – 18
= 12
 CHAPTER – 7 CORRELATION
I. Answer the following questions in a word / sentence (each question carries 1 mark).
1. What is correlation?
Ans. Correlation studies and measures the direction and intensity of relationship among variables.
2. What is Scatter diagram?
Ans.: A scatter diagram is a useful technique for visually examining the form of relationship, without
calculating any numerical value.
3. Write the formula for Spearman’s rank correlation
Ans.:

II. Answer the following questions in about four sentences (each question carries 2 marks)
1. Mention types of correlation.
Ans.: Correlation is commonly classified into negative and positive correlation
2. What is negative correlation? Give an example.
Ans.: The correlation is negative when they move in opposite directions. When the price of apples falls
its demand increases. When the prices rise its demand decreases.
3. What is positive correlation? Give an example.
Ans.: The correlation is said to be positive when the variables move together in the same direction.
When the income rises, consumption also rises.
4. Mention which type of correlation is associated with
a) Production and price of vegetable
Ans.: Production and price of vegetable are having Positive correlation
b) Temperature and sale of ice-creams
Ans.: Temperature and sale of ice-creams is having negative correlation
5. Interpret the values of r as 1, -1 and 0
Ans.: If r = 0 the two variables are uncorrelated. There is no linear relation between them.. If r = 1 or r
= –1 the correlation is perfect. The relation between them is exact. A high value of r indicates strong
linear relationship. Its value is said to be high when it is close to +1 or –1. A low value of r indicates a
weak linear relation. Its value is said to be low when it is close to zero.

III. Answer the following questions in about twelve sentences (each question carries 4 marks)
1. Calculate the correlation between the heights of fathers in inches (x) and their sons (y)
X 65 66 57 67 68 69 70 72
Y 67 56 65 68 72 72 69 71
Ans.:
X Y �)
(X - 𝐗𝐗 �)
(Y - 𝐘𝐘 �)2
(X - 𝐗𝐗 �) 2
(Y - 𝐘𝐘 �) (Y - 𝐘𝐘
(X - 𝐗𝐗 �)
65 67 -1.75 -0.5 3.0625 0.25 0.875
66 56 -0.75 -11.5 0.5625 132.25 8.625
57 65 -9.75 -2.5 95.0625 6.25 24.375
67 68 0.25 0.5 0.0625 0.25 0.125
68 72 1.25 4.5 1.5625 20.25 5.625
69 72 2.25 4.5 5.0625 20.25 10.125
70 69 3.25 1.5 10.5625 2.25 4.875
72 71 5.25 3.5 27.5625 12.25 18.375
534 540 143.5 194 73

ΣX 534
�
X = = = 66.75
N 8
 ΣY 540
�
Y = = = 67.5
N 8

73
r =11.98 X 13.93
73
r =166.88
r= 0.44
2. Calculate the correlation coefficient between X and Y and comment on their relationship
X 1 3 4 5 7 8
Y 2 6 8 10 14 16
Ans.

X Y �)
(X - 𝐗𝐗 �)
(Y - 𝐘𝐘 �)2
(X - 𝐗𝐗 �) 2
(Y - 𝐘𝐘 �) (Y - 𝐘𝐘
(X - 𝐗𝐗 �)
1 2 -3.67 -7.33 13.44 53.78 26.89
3 6 -1.67 -3.33 2.78 11.11 5.56
4 8 -0.67 -1.33 0.44 1.78 0.89
5 10 0.33 0.67 0.11 0.44 0.22
7 14 2.33 4.67 5.44 21.78 10.89
8 16 3.33 6.67 11.11 44.44 22.22
28 56 33.33 133.33 66.67

� = ΣX = 28 = 4.67
X
N 6

ΣY 56
�
Y = = = 9.33
N 6

66.67
r=
5.77 X 11.55
66.67
r=
66.67
r=1
As the value of r is positive and exactly 1 (r = 1) there exists perfect positive correlation,
3. Mention the properties of correction Coefficient (any four).
Ans.: The properties of correction Coefficient
(i) r has no unit. It is a pure number. It means units of measurement are not part of r. r between height
in feet and weight in kilograms, for instance, is 0.7.
(ii) A negative value of r indicates an inverse relation. A change in one variable is associated with
change in the other variable in the opposite direction.
(iii) If r is positive the two variables move in the same direction. When the price of coffee, a substitute
of tea, rises the demand for tea also rises.
(iv) If r = 0 the two variables are uncorrelated. There is no linear relation between them. However other
types of relation may be there.
(v) If r = 1 or r = –1 the correlation is perfect. The relation between them is exact. A high value of r
indicates strong linear relationship. Its value is said to be high when it is close to +1 or –1.
(vi) A low value of r indicates a weak linear relation. Its value is said to be low when it is close to zero.
(vii) The value of the correlation coefficient lies between minus one and plus one, –1 ≤ r ≤ 1. If, in any
exercise, the value of r is outside this range it indicates error in calculation.
(viii) The value of r is unaffected by the change of origin and change of scale. Given two variables X and
Y let us define two new variables.
4. Draw scatter diagram and conclude about correlation
X 10 20 30 40 50 60 70 80
Y 25 20 25 35 40 35 50 45
Ans.:

5. Draw scatter diagram and interpret.

X 1 2 3 4 5 6
Y 2 4 6 8 10 12
Ans.:

IV. Answer the following in about twenty sentences (each question carries 6 marks)
1. Calculate Karl Pearson’s coefficient of correlation from the following data using step deviation method
and comment on the result.
 X 12 14 16 18 20 22 24 28 30
Y 36 33 30 27 24 21 18 15 12

Ans.:
𝐗𝐗−𝟏𝟏𝟏𝟏 𝐘𝐘−𝟏𝟏𝟏𝟏
X Y U= V= U2 V2 UV
𝟐𝟐 𝟐𝟐

12 36 1 13 1 169 13
14 33 2 11.5 4 132.25 23
16 30 3 10 9 100 30
18 27 4 8.5 16 72.25 34
20 24 5 7 25 49 35
22 21 6 5.5 36 30.25 33
24 18 7 4 49 16 28
28 15 9 2.5 81 6.25 22.5
30 12 10 1 100 1 10
184 216 47 63 321 576 228.5

X−A X−B
U= ;V=
h k

−100.5
r=
2209 (3969 )
�321− �576−
9 9
−100.5
r=
√321−245.44 √576−441

−100.5
r= = —0.9951
100.995
As the value is nearer to —1 there exists negative close relationship
2. Calculate the coefficient of rank correlation.
X 18 28 35 44 35 26 37 48
Y 83 51 34 34 34 28 46 47
Ans.:
X Y Rx Ry D= Rx- Ry D2
18 83 8 1 7 49
28 51 6 2 4 16
35 34 4.5 6 -1.5 2.25
44 34 2 6 -4 16
35 34 4.5 6 -1.5 2.25
26 28 7 8 -1 1
37 46 3 4 -1 1
48 47 1 3 -2 4
91.5

1 1
6[∑ D 2 +12 �𝑚𝑚 13 − 𝑚𝑚 1 �+12 (𝑚𝑚 23 − 𝑚𝑚 2 )]
rS = 1 —
83 − 8
1 1
6[91.5+12 �23 − 2�+12 (33 − 3)]
=1 —
83 − 8
1 1
6[91.5+12 (8−2)+12 (27−3)]
=1 —
512−8
6 24
6[91.5+12 +12 ]
=1 —
504
6[91.5+0.5+2]
=1 —
504
6 X 94
=1 —
504
564
=1 —
504

= —0.11905
 CHAPTER – 8 INDEX NUMBERS
I. Choose the correct answers (each question carries 1 mark).
ΣP1Q0
1. The formula P01= ΣP0Q0 x 100 is given by
a) Laspeyre b) Paasche c) Marshal d) Fisher
Ans.: a) Laspeyre
2. In index number of which year price is assumed to be 100
a) Current year b) Base year c) Selection of prices d) none of these
Ans.: b) Base year
3. Laspeyre’s index is based on
a) Base year quantity b) Current year quantity
c) Both of them d) Average of current and base
Ans.: a) Base year quantity
4. Paasche’s index is based on
a) Current year quantity b) Base year quantity
c) Both of them d) None of these
Ans.: a) Current year quantity

II. Fill in the blanks (each question carries 1 mark).

1. Index numbers are expressed in …………………
Ans.: in terms of percentage
2. Inflation affects the ……………………….of common people.
Ans.: cost of living
3. Using current year quantities as weights is known as…………….
Ans.: Paasche’s price index
4. P1 and P0 indicate the price of the commodity in the current and ……………… period respectively.
Ans.: Base year

III. Match the following: (total 5 marks).

A B
1. CPI a) Producer Price Index
2. WPI b) Agriculture Price Index
3. IPI c) Consumer Price Index
4. API d) Wholesale Price Index
5. PPI e) Industrial Production Index
Ans: 1-c, 2-d, 3-e, 4-b, 5-a

IV. Answer the following questions in a word/sentence (each question carries 1 mark).
1. What is an index number?
Ans.: An index number is a statistical device for measuring changes in the magnitude of a group of
related variables.
2. What is price relative?
Ans.: The price relative is the ratio of the price of the commodity in the current period to that in the base
period, usually expressed in percentage terms ((P1/P0) × 100).
3. What is inflation?
Ans.: Inflation is a general and continuing increase in prices.
4. Write the formula to calculating index of industrial production.
Ans.: The formula to calculate index of industrial production is
5. What is SENSEX
Ans.: SENSEX is a useful guide for investors in the stock market which measures the value of wealth of
the shareholders.

V. Answer the following questions in about four sentences (each question carries 2 marks)
1. Mention some important index numbers?
Ans.: 1. Consumer Price Index (CPI),
2. Wholesale Price Index (WPI)
3. Industrial Production Index (IIP01)
4. Agricaltural Production Index (API)
5. SENSitive indEX (SENSEX)
2. What is consumer price index number? How do you calculate it?
Ans.: Consumer price index (CPI), also known as the cost of living index measures the average change in
retail prices. This can be calculated as follows:
∑WR
CPI =
∑W

3. What is wholesale price index? Write its drawbacks.

Ans.: The wholesale price index number indicates the change in the general price level. Unlike the CPI, it
does not have any reference to consumer category. It does not include items pertaining to services like
barber charges, repairing etc.
4. What is industrial production index? Which year considered as the base for their index on India.
Ans.: The index number of industrial production measures changes in the level of industrial production
comprising many industries. It includes the production of the public and the private sector. It is a
weighted average of quantity relatives. The formula for the industrial production index is

2004-05 year considered as the base for their index on India.

VI. Answer the following questions in about twelve sentences (each question carries 4 marks)
1. Calculate weighted average of price relative index from the following data
Base year Price (Rs) Current year Price(Rs)
Items Weight in %
(P0) (P1)
A 40 2 4
B 30 5 6
C 20 4 5
D 10 2 3
Ans.:
Weight Base year Current year 𝐏𝐏𝟏𝟏 𝐏𝐏𝟏𝟏
Items x 100 W X( x 100)
in % Price (Rs) (P0) Price(Rs) (P1) 𝐏𝐏𝟎𝟎 𝐏𝐏𝟎𝟎
A 40 2 4 200 8000
B 30 5 6 120 3600
C 20 4 5 125 2500
D 10 2 3 150 1500
Total 100 15600
 𝐏𝐏𝟏𝟏
∑W ( 𝐱𝐱 𝟏𝟏𝟏𝟏𝟏𝟏)
𝐏𝐏𝟎𝟎
P01 =
∑W
15600
= = 156
100

2. Compute the cost of living index number for the following data.
Commodities Q0 P0 P1
Wheat 20 10 12
Rice 5 30 35
Ghee 2 20 30
Sugar 4 25 40

Ans.:
𝐏𝐏𝟏𝟏
Commodities Q0 P0 P1 R= x 100 WR
𝐏𝐏𝟎𝟎
Wheat 20 10 12 120 2400
Rice 5 30 35 117 585
Ghee 2 20 30 150 300
Sugar 4 25 40 160 640
Total 31 3925

∑WR
CPI =
∑W
3925
= = 126.61
31

3. Calculate index numbers from the following data by Laspeyer’s method

Commodity P0 Q0 P1 Q1
A 8.0 5 10 11
B 8.5 6 9 9
C 9.0 4 12 6
Ans.:
Commodity P0 Q0 P1 Q1 P0Q0 P1Q0
A 8.0 5 10 11 40 50.0
B 8.5 6 9 9 51 54.0
C 9.0 4 12 6 36 48.0
Total 127 152

∑P1Q0
P01 = x 100
∑P0Q0
152
P01 = x 100
127
15200
P01 = = 119.69
127
VII. Answer the following in about twenty sentences (each question carries 6 marks)
1. Explain the difficulties in Construction of consumer price index number.
Ans.: The difficulties in Construction of consumer price index number are
1. The purpose of the index need to be clear. Calculation of a volume index will be inappropriate,
when one needs a value index.
2. The items are not equally important for different groups of consumers when a consumer price
index is constructed. The rise in petrol price may not directly impact the living condition of the
poor agricultural labourers. Thus the items to be included in any index have to be selected
carefully to be as representative as possible. Only then you will get a meaningful picture of the
change.
3. Every index should have a base. This base should be as normal as possible. Extreme values should
not be selected as base period. The period should also not belong to too far in the past. The
comparison between 1993 and 2005 is much more meaningful than a comparison between 1960
and 2005. Many items in a 1960 typical consumption basket have disappeared at present.
Therefore, the base year for any index number is routinely updated.
4. Another issue is the choice of the formula, which depends on the nature of question to be
studied. The only difference between the Laspeyres’ index and Paasche’s index is the weights
used in these formulae.
5. Besides, there are many sources of data with different degrees of reliability. Data of poor
reliability will give misleading results. Hence, due care should be taken in the collection of data. If
primary data are not being used, then the most reliable source of secondary data should be
chosen.
2. Write a short note on CPI, WPI and IIP.
Ans.:
Consumer Price Index (CPI)
Consumer price index, also known as the cost of living index, measures the average change in retail
prices. The CPI for industrial workers is increasingly considered the appropriate indicator of general
inflation, which shows the most accurate impact of price rise on the cost of living of common people.
This can be calculated by as follows
∑WR
CPI =
∑W
Wholesale Price Index (WPI)
The wholesale price index number indicates the change in the general price level. Unlike the CPI, it does
not have any reference consumer category. It does not include items pertaining to services like barber
charges, repairing etc. The commodity weights in the WPI are determined by the estimates of the
commodity value of domestic production and the value of imports inclusive of import duty during the
base year. It is available on a weekly basis. Commodities are broadly classified into three categories viz
primary articles, fuel, power, light and lubricants and manufactured products. The weight scheme is
given below. The low weight of fuel, power, light and lubricants explains how the government can get
away with such a statement that the oil price hike will not be inflationary at least in the short run.
Industrial Production Index (IIP01)
The index number of industrial production measures changes in the level of industrial production
comprising many industries. It includes the production of the public and the private sector. It is a
weighted average of quantity relatives. The formula for the index is

3. Calculate price index number by

a) Laspeyer’s method b) Paasche’s method
 1990 1995
Commodity Price Quantity Price Quantity
(P0) (Q0) (P0) (Q1)
A 20 15 30 20
B 15 10 20 15
C 30 20 25 10
D 10 5 12 10
Ans.:
1990 1995
Commodity Price quantity Price quantity P0Q0 P1Q0 P0Q1 P1Q1
(P0) (Q0) (P0) (Q1)
A 20 15 30 20 300 450 400 600
B 15 10 20 15 150 200 225 300
C 30 20 25 10 600 500 300 250
D 10 5 12 10 50 60 100 120
Total 1100 1210 1025 1270
a) Laspeyer’s method
∑P1Q0
P01 = x 100
∑P0Q0
1210
P01 = x 100
1100
121000
P01 = = 110
1100

b) Paasche’s method
∑P1Q1
P01 = x 100
∑P0Q1
1270
P01 = x 100
1025
127000
P01 = = 123.9
1025

VIII. Project oriented question (5 marks)

1. Write a note on SENSEX.
Ans.: SENSEX is a useful guide for investors in the stock market which measures the value of wealth of
the shareholders. Sensex is the short form of Bombay Stock Exchange Sensitive Index with 1978–79 as
base. The value of the sensex is with reference to this period. It is the benchmark index for the Indian
stock market. It consists of 30 stocks which represent 13 sectors of the economy and the companies
listed are leaders in their respective industries. If the sensex rises, it indicates that the market is doing
well and investors expect better earnings from companies. It also indicates a growing confidence of
investors in the basic health of the economy. The rise in sensex was at the highest level till date, which
reflects the good health of the economy in general. As the share prices increase, reflected by the rise in
Sensex, the value of wealth of the shareholders also rises. If sensex dips the investor’s wealth erodes. It
shows that all is not well with the health of the economy. The investors may find it hard to decide
whether to invest or not.
 CHAPTER – 9 USE OF STATISTICAL TOOLS
I. Choose the correct answers (each question carries 1 mark).
1. Use of statistical tools helps to
a) Developing a project b) Determining a project c) Marketing d) production
Ans.: a) Developing a project
2. The first step in making a project
a) Analysis and interpretation b) Collection of data c) identifying a problem d) organization of
data.
Ans.: c) identifying a problem

II. Fill in the blanks (each question carries 1 mark).

1. Survey helps to determine the method of collection of ……………….
Ans.: Data
2. The choice of target groups is very important while preparing the ………………
Ans.: Preparing the project

III. Answer the following questions in a word / sentence (each question carries 1 mark).
1. Mention the last step in developing a project.
Ans.: The last step in developing a project is drawing meaningful conclusion.
2. What is consumer awareness?
Ans.: Consumer awareness means the awareness of consumers on their rights.

IV. Answer the following questions in about four sentences (each question carries 2 marks)
1. Mention the name of any four statistical tools.
Ans.: Central tendency, dispersion, correlation, index numbers
2. Write the first four steps in developing a project.
Ans. The first four steps in developing a project are
(a) Identifying a problem or an area of study
(b) Choice of target group
(c) Collection of Data
(d) Organisation and Presentation of Data