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Measures of Dispersion
Measures of Dispersion
mean. Values close together will yield a small standard deviation, whereas values spread farther apart will yield a larger standard deviation. The standard deviation is an important tool in measuring variation.
CONCEPTS: Variation refers to the amount that values vary among themselves Values that are relatively close together have lower measures of
variation, and values that are spread farther apart have measures of variation that are larger
Size and thickness of each book is exactly the same, thus, value of variation is zero
Sales
250,000 270,000 220,000 230,000 260,000 210,000
Sales
240,000 240,000 210,000 230,000 270,000 250,000
Mean Sales
240,000
Mean Sales
240,000
Range
Variance
Standard Deviation
Quantiles
Coefficient of Variation
Median
Quartiles
Deciles
Percentiles
Range (R) A very rough measure of spread Provides useful but limited information since it depends only on the extreme values
DEFINITION
The RANGE (R) of a data set is the difference between the maximum and minimum data entries in the set. To find the range (R), the data must be quantitative Range (R) = (Maximum data entry) (Minimum data entry) = (Highest observed value) (Lowest observed value)
Range (R)
A corporation hired 10 graduates. The starting salaries for each graduate
are shown (in thousands of dollars). Find the range of the starting salaries for Corporation A.
Salary 41 38 39 45 47 41 44 41 37 42
Ordering the data helps to find the least and the greatest values
Salary 37 38 39 41 41 41 42 44 45 47
Range = (maximum value) (minimum value) Range = 47 37 = 10 So, the range of the starting salaries for a corporation is 10, or $10,000.
Important measure of
of variation Square root of Variance Has the same units as the original data
Finding the Sample Variance and Standard Deviation using sample mean
IN WORDS 1. Find the mean of the sample data set. 2. Find the deviation of each entry. 3. Square each deviation. 4. Add to get the sum of squares. IN SYMBOLS
5. Divide by n 1 to get the sample variance. 6. Find the square root of the variance to get the sample standard deviation.
Salary
41
38
39
45
47
41
44
41
37
42
Salary (x)
41
38
39
45
47
41
44
41
37
42
-0.5
-3.5
-2.5
3.5
5.5
-0.5
2.5
-0.5
-4.5
0.5
Salary (x) 41 -0.5
0.25
38 -3.5
12.25
39 -2.5
6.25
45 3.5
12.25
47 5.5
30.25
41 -0.5
0.25
44 2.5
6.25
41 -0.5
0.25
37 -4.5
20.25
42 0.5
0.25
5. Find the square root of the variance to get the sample standard deviation.
Salary 41 38 39 45 47 41 44 41 37 42
Salary (x)
(x)2
41
38
39
45
2025
47
2209
41
1681
44
1936
41
1681
37
1369
42
1764
Sample Mean and Sample Standard Deviation: Two Most Important Descriptive Measures
Majority within one standard deviation for most frequency distribution, a majority (as often as 68%) of all observations are within one standard deviation on either side of the mean.
Sample Mean and Sample Standard Deviation: Two Most Important Descriptive Measures
Usual or normal within two standard deviation for most frequency distribution the usual or normal values (as often as 95%) of all observations are within two standard deviations on either side of the mean.
Sample Mean and Sample Standard Deviation: Two Most Important Descriptive Measures
Unusual values lie above and below two standard deviations of the mean. Very unusual or extremely unusual values lie above and below three standard deviations of the mean
Unusual value
Unusual value
SKEWNESS
Definition: A distribution of data is skewed (asymmetric) if
it is not symmetric and if it extends more to one side than the other. (A distribution of data is symmetric if the left half of its histogram is roughly a mirror image of its right half)
SKEWNESS
Lopsided to the right = Skewed to the left = Negatively Skewed Lopsided to the left = Skewed to the right = Positively Skewed Data not lopsided = Symmetric = Zero Skewness
SKEWNESS