I have a question that was never directly addressed in any of my business
text books. Please excuse my lack of knowledge in this area; as I just need
a push in the right direction.
My current job requires me to analyze margins from the sales of various
products and provide an average for each during the quarter. I am using a
very large sample of all product sales by month. (Margin, i.e. not markup.
For those not familiar, markup is what a business does to receive Margin.
Margin is a measure of profitability. A typical calculation for margin is,
(Unit Resale Price - Unit Cost) / Unit Resale Price ).
An example of the data is:
Product Margin
ProdX .35
ProdX .64
ProdX .30
ProdB .22
ProdB .27
ProdC .64
ProdC .35
ProdX 1.12
ProdX .04
ProdX .57
Assuming a normal distribution, what method should I use to calculate my
averages? Should I simply take the sample mean? Should I remove anomalies
like 112% margins? Should I calculate upper and lower control limits and
place my data into a normal curve?
Thank you for your help.
-Chris
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