Importance Of Statistics

The modern world is based on calculations more than anything else. Calculations of money, calculation of wages, calculation of taxes and all these calculations need to be assimilated, and utilized in making more calculations. Thus, a proper system of data usage involves collecting all the data and organizing it properly. Moreover, not everyone will be able to understand data in the form it is organized, which, in turn, requires proper interpretation of data. Statistics is a science, which deals with all these phases of data rendering. Statistics is actually a branch of applied mathematics. Statistical methods are used to attain specific values out of a given data, based on probability. However, we need to understand that the basic understanding of statistics is not enough for a successful interpretation of business statistics. In fact, it is just the tip of the iceberg. Over the years, the importance of statistics has risen dramatically. Today, statistics is used in almost all the fields. In the following lines, we have given a note on the significance of statistics in the different fields.  

 

We all know that the study of economy or economics depends on different variables, based on the economic data of a specific economy. This is just another way of saying that economics is completely based on the study of economic statistics. Economics statistics are used for calculating various factors such as GDP (Gross Domestic Product) and GNP (Gross National Product), which are essential for knowing our exact economic condition. Statistics also alert us about any trend developing, which can be utilized for developing sound economic strategies.

 

For any of the natural sciences, experimentation is very important. Now, for the precise measurement of results, their tabulation, i.e. recording and comparison, is required, which is nothing but a form of statistics. Similarly, in social sciences scenario, it is very important to consider all the data related to the subjects in observation. Since social science spectrums includes a great number of subjects, mass data collection and assimilation is inevitable. This can be a really tedious task, if not done using proper statistical channels.

 

Astronomy is an ancient art and one of the most primitive too. Star gazing may be one of the easiest things to do in the night, but capturing exact distances in the space and predicting celestial events can be next to impossible, if a statistical approach is not used. Astronomers have been using statistical methods, like method of least squares, for a long time for calculation of celestial distances and comparing objects.

Banking sector is very important for general public. This sector, too, uses statistical data utilization approach for its functioning. The banking sector works on the money exchange system. They collect money from depositors and give money to people who want to borrow. All the while banks earn interest, a part of which they offer to the depositors. The banks calculate through statistical approach, which is they calculate the number of people who will appear each day as depositors or withdrawers and plans their actions similarly. If the calculation goes wrong, chances of the business collapsing and public money being at jeopardy is high.

In business structures, there may be nothing more important than statistical data and vice versa. Every business collects data about its consumers and their needs. This data is then assimilated and interpreted in order to form the base of their future plans and goals. Only on the basis of accurate data collection and assimilation can accurate projections for the future of the business be derived. Everything, right from expansion plans, disinvestment moves and new business and product proposals depend on such statistical calculations. Any small mistake here can spell doom for the business.