The Correlation of Business Math and Statistics from the Christian Worldview

The Correlation of Business Math and Statistics from the Christian Worldview

MBA615 Business Foundations

April 30, 2015

Introduction

The concepts of Business Math and Statistics, at first glance, to most would only serve mainly for basic arithmetic and other academic purposes.  However Statistics and business math indeed go far beyond the basis of computing probabilities along with variance, mean, median, and mode.  In business, statistics are paramount for making predictions/projections for company output, strategic planning for meeting customer needs as well as assisting in making crucial business decisions for the company in general.  From a Christian worldview perspective, this paper will correlate the concepts of Business Math, Forecasting, Regression Analysis, Probability, and Decision Analysis with the basic principles of God’s Word and how it coincides with these business aspects.

Unit Nine – Basic Business Math, Forecasting, and Regression Analysis

In Chapters One, Two, and Three of Unit Nine, Holt breaks down the basic principles of Business Math, the various methods of forecasting as it relates to statistics, and the utilization of the regression analysis.  The fundamental concepts Holt discusses in Chapter One involve basic functions and transposing terms, coefficients and exponents, solving for unknown variables in the base and exponent, monomials and polynomials, process of transposing equations, simultaneous equations, and other important mathematical concepts and functions.  Certain business activities often times require the use of mathematical methods to ascertain a combination of data for analytical purposes.  

In Chapters two and three Holt describes the importance and advantages of forecasting and regression analysis.  According to Holt and Miller, the regression analysis method can be a useful forecasting tool for predicting ideally futuristic outcomes.  Although there are similarities to the other forecasting techniques such as time series analysis and trend analysis in that recommendations about the unknown are generated from a collection of known data points however, in regression analysis the forecaster predictions are unlimited from a wide range varying from the historical levels of the variable to a variety of other possible conditions that may or may not affect the analysis (Holt & Miller, 2009, p. 38).  However, there are some disadvantages in using the regression analysis methodology for forecasting various outcomes.  One major flaw in the regression method is that is doesn’t account for the linearity in parameters in variables when making predictions.  When best making predictions of unknown, or non-linear, parameters and variables, you must first be able to estimate the linear model gain clear idea of what equivalent or outliers to consider in making a future prediction.  Another limitation in using the regression method is that sometimes other forecasting methodologies are utilized to forecast values of independent variables in the prediction period. In Proverbs 18:18 in states “Casting the lot settles disputes and keeps strong opponents apart.” In business situations there are often times a company or management must utilize forecasting and the regression analysis to pin point adverse trends and future predictions.  This verse entails the fact with either methodology a company has to commit to a decision drawn up from forecasting or using regression analysis.  Even though forecasting and the regression provide comparable information to generate valuable solutions, through Faith all can decisions can be made good and just.