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Chapter 2

Organizing and Visualizing Variables

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Objectives
In this chapter you learn:
⚫ How to organize and visualize categorical variables.
⚫ How to organize and visualize numerical variables.
⚫ How to summarize a mix of variables.
⚫ How to avoid making common errors when organizing
and visualizing variables.

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2.1 Organizing categorical variables

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Organizing Data Creates Both Tabular And

Visual Summaries

⚫ Summaries both guide further exploration and

sometimes facilitate decision making.
⚫ Visual summaries enable rapid review of larger
amounts of data & show possible significant
patterns.
⚫ Often, the Organize and Visualize step in DCOVA
occur concurrently.

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Categorical Data Are Organized By Utilizing

Tables
Categorical
Data

Tallying Data

One Two
Categorical Categorical
Variable Variables

Summary Contingency
Table Table

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Organizing Categorical Data: Summary Table

▪ A summary table tallies the frequencies or percentages of items in a set
of categories so that you can see differences between categories.

Devices Millennials Use to Watch Movies or Television Shows

Devices Used To Watch Movies or TV Shows Percent

Television Set 49%
Tablet 9%
Smartphone 10%
Laptop / Desktop 32%

Source: Data extracted and adapted from A. Sharma, “Big Media Needs to Embrace
Digital Shift Not Fight It,” Wall Street Journal, June 22, 2016, p. 1-2.

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A Contingency Table Helps Organize

Two or More Categorical Variables

⚫ Used to study patterns that may exist between the

responses of two or more categorical variables.
⚫ Cross tabulates or tallies jointly the responses of the
categorical variables.
⚫ For two variables the tallies for one variable are
located in the rows and the tallies for the second
variable are located in the columns.

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Contingency Table - Example

⚫ A random sample of 400

Contingency Table Showing
invoices is drawn. Frequency of Invoices Categorized
⚫ Each invoice is categorized as By Size and The Presence Of Errors
a small, medium, or large No
Errors Errors Total
amount.
Small 170 20 190
⚫ Each invoice is also examined Amount
to identify if there are any Medium 100 40 140
errors. Amount
⚫ This data are then organized in Large 65 5 70
the contingency table to the Amount
right. Total 335 65 400

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Contingency Table Based On Percentage Of Overall Total

No
Errors Errors Total 42.50% = 170 / 400
Small 170 20 190 25.00% = 100 / 400
Amount 16.25% = 65 / 400
Medium 100 40 140
Amount No
Large 65 5 70 Errors Errors Total
Amount Small 42.50% 5.00% 47.50%
Total 335 65 400 Amount
Medium 25.00% 10.00% 35.00%
Amount
83.75% of sampled invoices
Large 16.25% 1.25% 17.50%
have no errors and 47.50% Amount
of sampled invoices are for Total 83.75% 16.25% 100.0%
small amounts.
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Contingency Table Based On Percentage of Row Totals

No
Errors Errors Total 89.47% = 170 / 190
Small 170 20 190 71.43% = 100 / 140
Amount 92.86% = 65 / 70
Medium 100 40 140
Amount No
Large 65 5 70 Errors Errors Total
Amount Small 89.47% 10.53% 100.0%
Total 335 65 400 Amount
Medium 71.43% 28.57% 100.0%
Amount
Medium invoices have a larger
Large 92.86% 7.14% 100.0%
chance (28.57%) of having Amount
errors than small (10.53%) or Total 83.75% 16.25% 100.0%
large (7.14%) invoices.
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Contingency Table Based On Percentage Of Column Totals

No
Errors Errors Total 50.75% = 170 / 335
Small 170 20 190 30.77% = 20 / 65
Amount
Medium 100 40 140
Amount No
Large 65 5 70 Errors Errors Total
Amount Small 50.75% 30.77% 47.50%
Total 335 65 400 Amount
Medium 29.85% 61.54% 35.00%
Amount
There is a 61.54% chance
Large 19.40% 7.69% 17.50%
that invoices with errors are Amount
of medium size. Total 100.0% 100.0% 100.0%

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2.2. Organizing numerical variables

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Tables Used For Organizing

Numerical Data

Numerical Data

Ordered Array Frequency Cumulative

Distributions Distributions

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Organizing Numerical Data:

Ordered Array
▪ An ordered array is a sequence of data, in rank order, from the
smallest value to the largest value.
▪ Shows range (minimum value to maximum value).
▪ May help identify outliers (unusual observations).

Age of Day Students

Surveyed
16 17 17 18 18 18
College
Students 19 19 20 20 21 22
22 25 27 32 38 42
Night Students
18 18 19 19 20 21
23 28 32 33 41 45
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Organizing Numerical Data:

Frequency Distribution
▪ The frequency distribution is a summary table in which the data are
arranged into numerically ordered classes.

▪ You must give attention to selecting the appropriate number of class

groupings for the table, determining a suitable width of a class grouping,
and establishing the boundaries of each class grouping to avoid
overlapping.

▪ The number of classes depends on the number of values in the data. With
a larger number of values, typically there are more classes. In general, a
frequency distribution should have at least 5 but no more than 15 classes.

▪ To determine the width of a class interval, you divide the range (Highest
value–Lowest value) of the data by the number of class groupings desired.
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Organizing Numerical Data:

Frequency Distribution Example

Example: A manufacturer of insulation randomly

selects 20 winter days and records the daily high
temperature.

24, 35, 17, 21, 24, 37, 26, 46, 58, 30, 32, 13, 12, 38, 41, 43, 44, 27, 53, 27

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Organizing Numerical Data:

Frequency Distribution Example
▪ Sort raw data in ascending order:
12, 13, 17, 21, 24, 24, 26, 27, 27, 30, 32, 35, 37, 38, 41, 43, 44, 46, 53, 58.
▪ Find range: 58 - 12 = 46.
▪ Select number of classes: 5 (usually between 5 and 15).
▪ Compute class interval (width): 10 (46/5 then round up).
▪ Determine class boundaries (limits):
▪ Class 1: 10 but less than 20.
▪ Class 2: 20 but less than 30.
▪ Class 3: 30 but less than 40.
▪ Class 4: 40 but less than 50.
▪ Class 5: 50 but less than 60.
▪ Compute class midpoints: 15, 25, 35, 45, 55.
▪ Count observations & assign to classes.

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Organizing Numerical Data: Frequency

Distribution Example
Data in ordered array:
12, 13, 17, 21, 24, 24, 26, 27, 27, 30, 32, 35, 37, 38, 41, 43, 44, 46, 53, 58

Class Midpoints Frequency

10 but less than 20 15 3

20 but less than 30 25 6
30 but less than 40 35 5
40 but less than 50 45 4
50 but less than 60 55 2
Total 20

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Organizing Numerical Data: Relative &

Percent Frequency Distribution Example
Relative
Class Frequency Percentage
Frequency
10 but less than 20 3 .15 15%
20 but less than 30 6 .30 30%
30 but less than 40 5 .25 25%
40 but less than 50 4 .20 20%
50 but less than 60 2 .10 10%
Total 20 1.00 100%

Relative Frequency = Frequency / Total, e.g. 0.10 = 2 / 20

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Organizing Numerical Data: Cumulative

Frequency Distribution Example
Cumulative Cumulative
Class Frequency Percentage
Frequency Percentage

10 but less than 20 3 15% 3 15%

20 but less than 30 6 30% 9 45%
30 but less than 40 5 25% 14 70%
40 but less than 50 4 20% 18 90%
50 but less than 60 2 10% 20 100%
Total 20 100% 20 100%

Cumulative Percentage = Cumulative Frequency / Total * 100 e.g. 45% = 100*9/20

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Why Use a Frequency Distribution?

⚫ It condenses the raw data into a more useful

form.
⚫ It allows for a quick visual interpretation of the
data.
⚫ It enables the determination of the major
characteristics of the data set including where
the data are concentrated / clustered.

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Frequency Distributions:
Some Tips
⚫ Different class boundaries may provide different pictures for the
same data (especially for smaller data sets).

⚫ Shifts in data concentration may show up when different class

boundaries are chosen.

⚫ As the size of the data set increases, the impact of alterations in the
selection of class boundaries is greatly reduced.

⚫ When comparing two or more groups with different sample sizes,

you must use either a relative frequency or a percentage
distribution.

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2.3. Visualizing categorical variables

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Visualizing Categorical Data Through Graphical Displays

Categorical Data
Visualizing Data

Summary Contingency
Table For One Table For Two
Variable Variables

Bar Pareto Side By Side Doughnut

Chart Chart Bar Chart Chart

Pie or
Doughnut Chart
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Visualizing Categorical Data:

The Bar Chart
▪ The bar chart visualizes a categorical variable as a series of bars. The
length of each bar represents either the frequency or percentage of
values for each category. Each bar is separated by a space called a gap.

Devices Percent
Used to
Watch
Television Set 49%
Tablet 9%
Smartphone 10%
Laptop / 32%
Desktop

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Visualizing Categorical Data:

The Pie Chart
▪ The pie chart is a circle broken up into slices that represent categories.
The size of each slice of the pie varies according to the percentage in
each category.

Devices Percent
Used to
Watch
Television Set 49%
Tablet 9%
Smartphone 10%
Laptop / 32%
Desktop

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Visualizing Categorical Data:

The Doughnut Chart
▪ The doughnut chart is the outer part of a circle broken up into pieces
that represent categories. The size of each piece of the doughnut varies
according to the percentage in each category.

Devices Percent
Used to
Watch
Television Set 49%
Tablet 9%
Smartphone 10%
Laptop / 32%
Desktop

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Visualizing Categorical Data:

The Pareto Chart
⚫ Used to portray categorical data (nominal scale).
⚫ A vertical bar chart, where categories are shown in
descending order of frequency.
⚫ A cumulative polygon is shown in the same graph.
⚫ Used to separate the “vital few” from the “trivial
many.”

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Visualizing Categorical Data:

The Pareto Chart (con’t)
Ordered Summary Table For Causes
Of Incomplete ATM Transactions
Cumulative
Cause Frequency Percent Percent
Warped card jammed 365 50.41% 50.41%
Card unreadable 234 32.32% 82.73%
ATM malfunctions 32 4.42% 87.15%
ATM out of cash 28 3.87% 91.02%
Invalid amount requested 23 3.18% 94.20%
Wrong keystroke 23 3.18% 97.38%
Lack of funds in account 19 2.62% 100.00%
Total 724 100.00%
Source: Data extracted from A. Bhalla, “Don’t Misuse the Pareto Principle,” Six Sigma Forum
Magazine, May 2009, pp. 15–18.

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The “Vital
Few”
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Visualizing Categorical Data:

Side By Side Bar Charts
▪ The side by side bar chart represents the data from a contingency table.

No
Errors Errors Total
Invoice Size Split Out By Errors
Small 50.75% 30.77% 47.50% & No Errors
Amount
Medium 29.85% 61.54% 35.00% Errors

Amount
Large 19.40% 7.69% 17.50% No Errors

Amount
0.0% 10.0% 20.0% 30.0% 40.0% 50.0% 60.0% 70.0%
Total 100.0% 100.0% 100.0% Large Medium Small

Invoices with errors are much more likely to be of

medium size (61.5% vs 30.8% & 7.7%).
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Visualizing Categorical Data:

Doughnut Charts
▪ A Doughnut Chart can be used to represent the data from a contingency table.

No
Invoice Size & Errors
Errors Errors Total Inner Ring With Errors, Outer Ring No Errors

Small 50.75% 30.77% 47.50% 19.4%

Amount 7.7%
30.8%
30.8%

Medium 29.85% 61.54% 35.00%

Amount 61.5%

29.9%
Large 19.40% 7.69% 17.50%
Amount
Small Medium Large

Total 100.0% 100.0% 100.0%

Invoices with errors are much more likely to be of

medium size (61.5% vs 30.8% & 7.7%).
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2.4. Visualizing numberical variables

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Visualizing Numerical Data By Using Graphical Displays

Numerical Data

Frequency Distributions
Ordered Array and
Cumulative Distributions

Stem-and-Leaf
Histogram Polygon Ogive
Display

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Stem-and-Leaf Display

⚫ A simple way to see how the data are distributed

and where concentrations of data exist.

METHOD: Separate the sorted data series

into leading digits (the stems) and
the trailing digits (the leaves).

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Organizing Numerical Data:

Stem and Leaf Display
▪ A stem-and-leaf display organizes data into groups (called
stems) so that the values within each group (the leaves)
branch out to the right on each row.
Age of College Students

Age of Day Students Day Students Night Students

Surveyed
16 17 17 18 18 18 Stem Leaf
College Stem Leaf
Students 19 19 20 20 21 22
1 67788899 1 8899
22 25 27 32 38 42
Night Students 2 0012257 2 0138
18 18 19 19 20 21
3 28 3 23
23 28 32 33 41 45
4 2 4 15

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Visualizing Numerical Data:

The Histogram
▪ A vertical bar chart of the data in a frequency distribution is
called a histogram.

▪ In a histogram there are no gaps between adjacent bars.

▪ The class boundaries (or class midpoints) are shown on the

horizontal axis.

▪ The vertical axis is either frequency, relative frequency, or

percentage.

▪ The height of the bars represent the frequency, relative

frequency, or percentage.
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Visualizing Numerical Data:

The Histogram
Relative
Class Frequency Percentage
Frequency

10 but less than 20 3 .15 15

20 but less than 30 6 .30 30
30 but less than 40 5 .25 25
40 but less than 50 4 .20 20
50 but less than 60 2 .10 10
8
Total 20 1.00 100
Histogram:
Histogram: Temperature
Age Of Students
6

Frequency
4
(In a percentage
histogram the vertical
axis would be defined to 2
show the percentage of
observations per class).
0
5 15 25 35 45 55 More

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Visualizing Numerical Data:

The Percentage Polygon
▪ A percentage polygon is formed by having the midpoint of
each class represent the data in that class and then connecting
the sequence of midpoints at their respective class
percentages.

▪ The cumulative percentage polygon, or ogive, displays the

variable of interest along the X axis, and the cumulative
percentages along the Y axis.

▪ Useful when there are two or more groups to compare.

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Visualizing Numerical Data:

The Frequency Polygon
Useful When Comparing Two or More Groups

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Visualizing Numerical Data:

The Percentage Polygon

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Visualizing Numerical Data:

The Cumulative Percentage Polygon (Ogive)
Useful When Comparing Two or More Groups

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Visualizing Numerical Data:

The Cumulative Percentage Polygon (Ogive)

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1.5. Visualizing Two Numerical

Variables

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Visualizing Two Numerical Variables By Using

Graphical Displays

Two Numerical
Variables

Scatter Time-
Plot Series
Plot

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Visualizing Two Numerical Variables: The

Scatter Plot

▪ Scatter plots are used for numerical data consisting of paired

observations taken from two numerical variables.

▪ One variable’s values are displayed on the horizontal or X

axis and the other variable’s values are displayed on the
vertical or Y axis.

▪ Scatter plots are used to examine possible relationships

between two numerical variables.

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Scatter Plot Example

Volume Cost per

per day day
Cost per Day vs. Production Volume
23 125
250
26 140
Cost per Day 200
29 146
150
33 160
100
38 167
50
42 170
0
50 188
20 30 40 50 60 70
55 195
Volume per Day
60 200

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Visualizing Two Numerical Variables: The

Time Series Plot

⚫ A Time-Series Plot is used to study patterns

in the values of a numeric variable over time.

⚫ The Time-Series Plot:

– Numeric variable’s values are on the vertical
axis and the time period is on the horizontal axis.

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Time Series Plot Example

Number of
Year Franchises
2009 43 Number of Franchises, 1996-2004
2010 54
120

Number of Franchises
2011 60 100
80
2012 73
60
2013 82 40
20
2014 95 0
2008 2010 2012 2014 2016 2018
2015 107
Year
2016 99
2017 95

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1.6. Organizing A Mix Of Variables

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The Multidimensional Contingency Table

⚫ A multidimensional contingency table is constructed by

tallying the responses of three or more categorical variables.
– Can be used to discover possible patterns and relationships in
multidimensional data that simpler tables and charts would fail to
make apparent.

⚫ As a practical rule, tables should be limited to no more than

three or four variables.

⚫ In typical use, these tables:

– Extend contingency tables to two or more row or column variables, or
– Replace the frequencies found in a contingency table with summary
information about a numeric variable.
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A Multidimensional Contingency Table

Tallies Responses Of Three or More
Categorical Variables
Two Dimensional Table Showing Three Dimensional Table
Fund Type and Risk Level for Showing Fund Type, Market
sample of 479 retirement funds. Cap, and Risk Level for the
sample of the 479 retirement
funds.

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Excel, Minitab, and JMP Can Be Used To

Create Multidimensional Contingency Tables

⚫ In Excel creating a Pivot Table yields an interactive display

of this type.

⚫ In JMP you can create a table that is also interactive.

⚫ In Minitab you can create such a table but it is not interactive.

⚫ JMP and Minitab have many specialized statistical &

graphical procedures (not covered in this book) to analyze &
visualize multidimensional data.
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Drilling-Down On A Table Reveals The Data

The Table Summarizes

⚫ Clicking a cell in an Excel table displays the

rows of data associated with that cell.

⚫ Clicking a cell in a JMP table highlights those

the rows of data that are the source for that cell.

⚫ Drill-down is perhaps the simplest form of data

discovery.

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Drill-Down Reveals The Data Underlying A

Higher-Level Summary

Results of drilling down to

the details about small value
funds with low risk revealing
the ten-year return ranges from
4.83% to 9.44%.

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1.7. Displays To Visualize A Mix Of Many Variables

⚫ Displays are more useful than a multidimensional

contingency table with many row and column
variables.
⚫ The data (not just summary statistics) can be shown
for numerical variables.
⚫ Multiple numerical variables can be presented in one
summarization.
⚫ Visualizations can reveal patterns that can be hard to
see in tables.

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Colored Scatter Plots Visualize Both Numerical

Variables & Categorical Variable(s)
Observations:
Large Market Capitalization Funds (red dots)
1. Relatively have best returns and lowest expense ratios.

2. Some have either low returns or high expense ratios or both.

JMP Colored
Scatter Plot

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Bubble Charts Extend Scatter Plots

⚫ Use the size of points (called bubbles) to represent

the value of an additional variable.

⚫ In Excel and Minitab the additional variable must be

numerical.

⚫ In JMP the variable can be either numerical or

categorical.

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An Excel PivotChart Visualizes Specific Categories From A

PivotTable Summary

Low Risk Small

Market Cap Funds
Have The Highest Mean
Return Among Low Risk
Funds.

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Treemaps Are Graphical Displays Of

Contingency Tables
Excel Treemap: JMP Treemap:
Size of tiles correspond to Size of tiles correspond to the value
the frequency in a cell. of the numeric variable Market Cap.

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Sparklines Are Compact Time-Series

Visualizations Of Numerical Variables

Movie
revenues
by week
per month

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1.8. Filtering and Querying Data

⚫ Two operations associated with preparing tabular or

visual summaries are Data Filtering and Querying.
⚫ Data filtering selects rows of data that match criteria;
specified value(s) for specific variable(s).
⚫ Data Querying is similar but may not select all of the
columns of the matching rows.
⚫ Excel, JMP, and Minitab all have various filtering &
query features.

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Example Of JMP & Minitab Filtering / Querying

Selecting all rows in value retirement funds that have
ten-year return percentages that are greater than or
equal to 9.

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Excel Slicers Filter & Query Data From A Pivot Table

⚫ A slicer is a panel of clickable buttons superimposed
over a worksheet.

⚫ Each button in a slicer represents a unique value of a

variable found in a the source data of a PivotTable.

⚫ By clicking buttons in the slicer panels, you query

the data.

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Example Of Slicers For The Retirement

Funds Workbook
With the four slicers below, you can ask questions such as:
1. What are the attributes of the fund(s) with the lowest expense ratio?
2. What are the expense ratios associated with large market cap value
funds that have a star rating of five?

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Answering The Questions

What are the
attributes of the What are the expense ratios associated
fund(s) with the with large market cap value funds that
lowest expense ratio? have a star rating of five?

The updated The expense ratios for these funds are:

PivotTable (not shown 0.83, 094, 1.05, 1.09, 1.18, and 1.19.
below) reveals only
one such fund.

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2.9. Pitfalls in organizing and

visualizing variable

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The Challenges in Organizing and Visualizing Variables

⚫ When organizing and visualizing data need to be

mindful of:
– The limits of other’s ability to perceive and
comprehend.
– Presentation issues that can undercut the
usefulness of methods from this chapter.
⚫ It is easy to create summaries that:
– Obscure the data or
– Create false impressions.
– Contain Chartjunk
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An Example Of Obscuring Data, Information Overload

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False Impressions Can Be Created In

Many Ways

⚫ Selective summarization:
– Presenting only part of the data collected.
⚫ Improperly constructed charts:
– Potential pie chart issues.
– Improperly scaled axes.
– A Y axis that does not begin at the origin or is a broken
axis missing intermediate values.
⚫ Chartjunk.

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An Example of Selective Summarization, These

Two Summarizations Tell Totally Different Stories

Change
from Prior
Company Year Company Year 1 Year 2 Year 3
A +7.2% A -22.6% -33.2% +7.2%
B +24.4% B -4.5% -41.9% +24.4%
C +24.9% C -18.5% -31.5% +24.9%
D +24.8% D -29.4% -48.1% +24.8%
E +12.5% E -1.9% -25.3% +12.5%
F +35.1% F -1.6% -37.8% +35.1%
G +29.7% G +7.4% -13.6% +29.7%
Applied Statistics for Business
 ĐẠI HỌC FPT CẦN THƠ

How Obvious Is It That Both Pie Charts

Summarize The Same Data?

Why is it hard to tell? What would you do to improve?

Applied Statistics for Business
 ĐẠI HỌC FPT CẦN THƠ

Graphical Errors:
No Relative Basis

Bad Presentation ✓Good Presentation

A’s received by A’s received by
Freq. students. % students.
30%
300

200 20%

100 10%

0 0%
FR SO JR SR FR SO JR SR

FR = Freshmen, SO = Sophomore, JR = Junior, SR = Senior

Applied Statistics for Business

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Graphical Errors:
Compressing the Vertical Axis

Bad Presentation ✓ Good Presentation

Quarterly Sales Quarterly Sales
$ $
200 50

100 25

0 0
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4

Applied Statistics for Business

 ĐẠI HỌC FPT CẦN THƠ

Graphical Errors: No Zero Point on the

Vertical Axis

Bad Presentation
✓ Good Presentations

Monthly Sales $ Monthly Sales

$ 45
45
42
42 39
39 36
36 0
J F M A M J J F M A M J

Graphing the first six months of sales

Applied Statistics for Business

 ĐẠI HỌC FPT CẦN THƠ

Graphical Errors: Chart Junk, Can You

Identify The Junk?

Bad Presentation ✓ Good Presentation

Left illustration adapted from S. Watterson, “Liquid Gold—Australians Are Changing the World of Wine. Even the French Seem Grateful.” Time,
November 22, 1999, p. 68-69

Applied Statistics for Business

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Best Practices for Constructing

Visualizations

▪ Use the simplest possible visualization.

▪ Include a title & label all axes.
▪ Include a scale for each axis if the chart contains axes.
▪ Begin the scale for a vertical axis at zero & use a
constant scale.
▪ Avoid 3D or “exploded” effects & the use of chartjunk.
▪ Use consistent colorings in charts meant to be compared.
▪ Avoid using uncommon chart types including radar,
surface, bubble, cone, and pyramid charts.

Applied Statistics for Business

 ĐẠI HỌC FPT CẦN THƠ

Chapter Summary
In this chapter we covered:
⚫ Organizing and visualizing categorical variables.
⚫ Organizing and visualizing numerical variables.
⚫ Summarizing a mix of variables.
⚫ Avoiding common errors when organizing and
visualizing variables.

Applied Statistics for Business