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General Calculation of Standard Deviation Video Lecture | Mathematics for GRE Paper II

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FAQs on General Calculation of Standard Deviation Video Lecture - Mathematics for GRE Paper II

1. What is the formula for calculating standard deviation?
Ans. The formula for calculating standard deviation is: Standard Deviation = √(Σ(xi - x̄)² / N), where xi represents each individual value in the data set, x̄ is the mean of the data set, and N is the total number of values.
2. How is standard deviation different from variance?
Ans. Standard deviation and variance are both measures of dispersion in a data set, but they differ in the unit of measurement. Variance is the average of the squared differences from the mean, while standard deviation is the square root of the variance. Standard deviation is expressed in the same units as the original data, making it more interpretable than variance.
3. When is standard deviation used instead of range?
Ans. Standard deviation is used instead of range when we want to measure the dispersion or spread of a data set while considering the individual values and their deviations from the mean. Range only considers the difference between the maximum and minimum values, providing a limited understanding of the variability within the data set. Standard deviation provides a more comprehensive measure of dispersion.
4. What does a high standard deviation indicate about a data set?
Ans. A high standard deviation indicates that the values in the data set are widely spread out from the mean. This suggests a greater variability or dispersion within the data set. In practical terms, a high standard deviation means that the individual values in the data set deviate more from the average, indicating more diversity or unpredictability in the data.
5. How can standard deviation be used in decision-making?
Ans. Standard deviation can be used in decision-making by providing insights into the variability and risk associated with different options. For example, in financial analysis, standard deviation is used to measure the volatility of investments. A higher standard deviation suggests higher risk, while a lower standard deviation indicates more stability. By considering the standard deviation, decision-makers can assess the potential outcomes and make informed choices based on their risk tolerance.
258 videos|200 docs|166 tests
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