The Foundation of Data-Driven Decisions

The Foundation of Data-Driven Decisions
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Question 1:
Descriptive and Inferential Statistical Method
Descriptive statistics is the action of using statistical techniques to study and summarize a group of data. As one of the major types of data analysis, descriptive analysis is known for its ability to procreate accessible insights from otherwise uninterpreted data. Unlike other types of data analysis, the descriptive analysis does not aim to make predictions. Instead, it formulates insights solely from past data, by manipulating it in ways that create it more meaningful. The descriptive analysis uses a variety of statistical techniques, including measures of frequency, central tendency, dispersion, and position (Bush, 2020).
As a sample of descriptive analysis, consider a health card company studying its customer base. The health card company may detect certain traits about its customers, such as their gender, age, and nationality. To obtain a better profile of their customers, the health card company can use descriptive analysis. Measures of frequency can be used to determine how many customers are under a certain age; measures of central tendency can be used to know who most of their customers are; measures of dispersion can be used to identify the variation in, finally, measures of position can be used to differentiate segments of customers based on specific traits.
Inferential statistics is employed to analyze data, together with descriptive statistics. The goal of this tool is to give measurements that can draw the overall population of a research project by analyzing a smaller sample of it. This way the researcher can build assumptions about key elements with a fair degree of confidence. Among these inferential tools, we have regression models, normal distributions, and R-squared analysis, among others. The study of the smaller sample can be used to interpret the variable's overall behavior from a whole-population perspective which leads the path for theories and a recent hypothesis. In business, inferential statistics are widely used.
As an example, a company of Milk Tea is currently performing market study about their customer's behavior when it comes to drinking milk tea. The company is trying to catch the favorite tastes of its customers to re-design the menu. They hired a marketing consulting company to collect a focus group to study the matter....