1.1 Prerequisites

Data science is the intersection of statistics and computer programming. Business analytics is the mixture of those with an introduction of economics and business data. This book is meant to be a two semester introductory sequence for a Master’s program in business analytics. That means that the reader should have some familiarity with many different concepts. You don’t have to know every prerequisite area. Most people don’t. But you should have some familiarity with some of these areas.

Algebra. I am going to assume that you are comfortable with algebra. I am going to assume you are comfortable with summation notation. If I tell you the sample mean is:\(\overline{x}=n^{-1}\sum_{i=1}^n x_i\), I will assume you can read and understand that equation. If you can’t, it doesn’t mean that you can’t be a data scientist, but in order to make any progress, I have to assume some preliminaries. If you know linear algebra, that would be helpful although it is certainly not required. Most data analytics techniques involve linear algebra that is usually done behind the scenes by the computer. So knowing linear algebra will help you to understand what the computer is doing.

Calculus. A knowledge of calculus (especially pre-calc) would also be extremely helpful. Calculus is the science of how things change. We are going to be discussing change very often, so it’s helpful to know calculus, although if it isn’t fresh in your mind, that’s fine. It’s the ideas that are important.

Economics. I am going to be discussing economic ideas and concepts. I’m not going to assume that you know any serious economics, but economic concepts and ideas should not be completely foreign to you.

Statistics. In this book, I am going to take a deep dive into statistics. I am going to start with the very basics such as expected value and variance, but we are quickly going to move through these into fairly advanced topics. Some background in basic statistics would be extremely helpful going into this book.

Programming. We are going to be doing some serious programming in R in this book. You need not to have ever done programming before, but general computer knowledge will be assumed. You need to know how to install programs. You should have some ideas about how your operating system works and how the software on your computer works.