If the two variations are in close agreement, then there is no reason to believe that sales are not same in all four regions and if not then it may be concluded that there exists a substantial difference between some or all the regions. So, total variation present in the sample data may be partitioned into two components: between-regions and within-regions and their magnitudes may be compared to decide whether there is a substantial difference in the sales with respect to regions. there might be variation among regions (between-group variations). There might be impact of the regions and mean-sales of the four regions would not be all the same i.e.Sales within a region would differ and this would be true for all four regions (within-group variations).If we analyze the sources of variation in the sales, in this case, we may identify two sources: Here, the total variation in the sales may be measured by the squared sum of deviation from the mean sales. Variation, being a fundamental characteristics of data, would always be present. Random sample data of sales collected from different outlets spread over the four geographical regions. For administrative and planning purpose, Ventura has sub-divided the state into four geographical-regions (Northern, Eastern, Western and Southern). Its outlets have been spread over the entire state. Ventura is an FMCG company, selling a range of products. Initially, Analysis of Variance (ANOVA) had been employed only for the experimental data from the Randomized Designs but later they have been used for analyzing survey and secondary data from the Descriptive Research.Īnalysis of Variance may also be visualized as a technique to examine a dependence relationship where the response (dependence) variable is metric (measured on interval or ratio scale) and the factors (independent variables) are categorical in nature with a number of categories more than two.
With the help of such a partitioning, some testing of hypothesis may be performed. The systematic procedure to achieve this is called Analysis of Variance (ANOVA).
The total variation present in a set of data may be partitioned into a number of non-overlapping components as per the nature of the classification. So, in these situations, we have to compare the mean values of various groups, with respect to one or more criteria. There are interest lies in examining whether the total sample can be considered as homogenous or there is some indication that sub-samples have been drawn from different populations. the sample may be supposed to have consisted of k-sub samples. In some decision-making situations, the sample data may be divided into various groups i.e.
LinkedIn profile: What is Analysis of Variance (ANOVA)? Two-Way Analysis of Variance (Two-Way ANOVA).
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