An analysis of monthly wages paid to workers in two firms A and B, belonging to the same industry, gives the following results.
Firm A Firm B
No. of wage earners 586 648
Mean of monthly wages Rs 5253 Rs 5253
Variance of the distribution of wages. 100 121
(i) which firm A or B pays larger amount as monthly wages ?
(ii) which firm A or B, shows greater variability in individual wages ?
(i) Firm A : Number of wages earners (n1) = 586
Mean of monthly wages (¯¯¯¯¯x1) = Rs 5253
∴ Total monthly wages = 5253 × 586 = Rs 3078258
Firm B : Number of wages earners (n2) = 648
Mean of monthly wages (¯¯¯¯¯x2) = Rs 5253
∴ Total monthly wages = 5253 ×586 = Rs 3403944.
(ii) Since both the firms have same mean of monthly wages, so the firm with greater variance will have more variability in individual wages. Thus firm B will have more variability in individual wages.