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FIN10002 Financial Statistics Assignment - Swinburne University of Technology, Australia

Assessment: Report

Assessment details - You will need to download the Excel dataset 'AustralianSalesdata.xlsx' from Canvas. The data set is about office supply sales and is supplied by the 'Hardware and GardenSupplies'. There are 2002 orders for the year in this data set, and nine variables as follows:

1. ORDER ID: Order number in no particular order

2. ORDER PRIORITY:Importance of order (4: Critical, 3: High, 2, Medium, 1 Low and 0 is not specified)

3. ORDER QUANTITY: The number of items within the order

4. SALES: The total dollar of the order ($)

5. SHIP MODE:The type of mode of delivery (1: Regular Air, 2: Delivery Truck, 3: Express Air)

6. Shipping Cost: the total dollar of the shipping cost. ($)

7. Region: Delivered to a Western state (W) or to an Eastern state (E)

8. CONSUMER SEGMENT: Type of customer (Corporate, Home Office, Consumer or Small Business)

9. DAYS TO SHIP: number of days to ship the order from the day the order was placed

You will use this data set to generate responses to the following six tasks.

1. Select a random sample

Select a random sample of size 60 from the given 2002orders in the AustralianSales data set. You will use this sample data to complete tasks 2 to 6.

2. Descriptive statistics

Use data summary methods to describe the orders in your sample using eight variables - items 2 to 9 above.(Note: Do NOT do Order Id) Use an appropriate graphical and summary statistical technique, chosen according to the type of variable (note that less appropriate/inappropriate techniques will receive fewer/no marks). Choose your techniques from:

Tabular Techniques: frequency tables and grouped frequency tables

Summary Statistics:mode, median, mean, standard deviation, range, coefficient of variation and interquartile range

Graphical Techniques: pie chart, bar graph, histogram, frequency polygon.(See topics 1 and 2)

Do not draw an ogive curve, stem plot, or a box plot in this assignment and do not draw 3-D graphs.

1. For a nominal or an ordinal variable draw a graph and present a frequency table in percentages.

2. For a ratio or an interval variable draw a graph and a summary statistics table, including summary statistics appropriate to the type of distribution only.

3. Try to use variation in drawing graphs e.g. pie chart/bar chart or histogram/polygon.

4. Do not draw two different graphs for the same variable. You can draw the same type of graph for two variables.

5. Do not include any information that you will not include in your discussion such as kurtosis.

6. Display and describe one variable at a time.

3. Confidence intervals

Estimate the following quantities, using 95% confidence intervals. Explain the meaning of your confidence intervals.

1. The average sales amount of orders for the home office customers only.

2. The average shipping costs for all sample orders.

Compare both intervals with their respective true means by calculating the actual population mean for the full 2002orders, and comparing the population mean to the sample mean and confidence interval (note: it is not usual to do this, so you are asked to do this for the purpose of this assignment).

Your confidence interval should start with 'We are 95% confident that...". This section should take half a page or less.

NB: Please make sure you provide sufficient information in the appendix for your confidence interval calculations to be replicated, so they can be checked.

4. Hypothesis testing

1. It is often felt that the order priority of critical would have higher shipping costs than an order of lowpriority. Investigate this contention by carrying out an appropriate hypothesis test.

2. It is often felt that the average sales order in dollars, differs for Eastern states (E) and Western states (W). Use region for this test.

For both parts, use a significance level of 0.05.

Only report a non-technical explanation of your methodology and your findings in the main section of the report. The computations and output should be placed in an appendix, including the test statistic, p-value and degrees of freedom. This should take half a page or less.

5. Correlation and regression

In this section you will investigate the relationship between the sales in dollars and order quantity. Using these two variables (sales and order quantity) develop a regression model to predict average sales in dollars from order quantity. Make sure that you undertake a full regression analysis, with appropriate discussion and include:

1. a scattergram and a brief discussion

2. an estimate of the linear regression model

3. the coefficients of correlation and determination

4. a test of the hypothesis that there is no linear relationship between sales and order quantity for an order.

Ensure your scattergram includes a line of best fit. Also, make sure you describe the relationship between the variables using R and R-square, and interpret the slope, coefficients and the results of the hypothesis test. Use a significance level of 0.05.

6. Conclusion

Provide a brief, concise summary of all of your findings and briefly mention any limitations in your findings. Make sure you do not give tables or graphs here.

Note - The report should be presented in the form of a business report to a senior manager who cannot be assumed to have any particular knowledge of statistical methods. Make your report informative but concise and use a non-technical style. Do not just quote statistics or analysis results but explain what they mean. In general, do not include in the report formulae, calculations, definitions of statistical terms or discussions on how graphs are constructed. Where appropriate these may be included in the appendices.

Attachment:- Financial Statistics Assignment & Data File.rar