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Why is Level of Measurement

Important?

• It helps you how to interpret the data from that
variable.

• It is associated with the type of statistical method
used.

• Higher levels of measurement provide more
information than do lower levels

• In general, you should use the highest level of
measurement possible. Eg. actual age in years,
not age group.

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Characteristics of Measurement Scale

Permissible statistics
Scale
Descriptive Inferential
Brand numbers, percentages, chi-square,
Nominal Store types, sex mode binomial test
+
Preferences rankings percentile, rank correlation,
Market position, median ANOVA
Ordinal Social class
+

temperature, range, mean, correlation
IQ score, std dev t-test, ANOVA,
Interval Index number regression,
factor analysis
+
Age, income, ALL CV, ALL
Costs, sales,
Ratio Market shares
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