...Standard deviation http://en.wikipedia.org/wiki/Standard_deviation, From Wikipedia, the free encyclopedia In probability and statistics, the standard deviation of a probability distribution, random variable, or population or multiset of values is a measure of the spread of its values. It is usually denoted with the letter σ (lower case sigma). It is defined as the square root of the variance. To understand standard deviation, keep in mind that variance is the average of the squared differences between data points and the mean. Variance is tabulated in units squared. Standard deviation, being the square root of that quantity, therefore measures the spread of data about the mean, measured in the same units as the data. Said more formally, the standard deviation is the root mean square (RMS) deviation of values from their arithmetic mean. For example, in the population {4, 8}, the mean is 6 and the deviations from mean are {-2, 2}. Those deviations squared are {4, 4} the average of which (the variance) is 4. Therefore, the standard deviation is 2. In this case 100% of the values in the population are at one standard deviation of the mean. The standard deviation is the most common measure of statistical dispersion, measuring how widely spread the values in a data set are. If the data points are close to the mean, then the standard deviation is small. As well, if many data points are far from the mean, then the standard deviation is large. If all the data values are equal, then the...
Words: 3023 - Pages: 13
...Standard Deviation (1 of 3) Introduction So far, we have introduced two measures of spread; the range (covered by all the data) and the inter-quartile range (IQR), which looks at the range covered by the middle 50% of the distribution. We also noted that the IQR should be paired as a measure of spread with the median as a measure of center. We now move on to another measure of spread, the standard deviation, which quantifies the spread of a distribution in a completely different way. Idea The idea behind the standard deviation is to quantify the spread of a distribution by measuring how far the observations are from their mean, x. The standard deviation gives the average (or typical distance) between a data point and the mean, x. Notation There are many notations for the standard deviation: SD, s, Sd, StDev. Here, we'll use SD as an abbreviation for standard deviation, and use s as the symbol. Calculation In order to get a better understanding of the standard deviation, it would be useful to see an example of how it is calculated. In practice, we will use a computer to do the calculation. Example: Video Store Customers The following are the number of customers who entered a video store in 8 consecutive hours: 7, 9, 5, 13, 3, 11, 15, 9 To find the standard deviation of the number of hourly customers: 1. Find the mean, x of your data: (7+9+5+. . .+9) = 9 8 2. Find the deviations from the mean: the difference between each observation...
Words: 1623 - Pages: 7
...to return anything to the investor. However, investing in the stock market also presents the possibility for higher returns, the benefit of partial ownership in a company and the unlimited potential of a rising stock price, as well as the opportunity of further diversification of the portfolio. 3. The differences in return between stocks and bonds are that stocks have a higher return than bonds as shown with the average returns. Bonds have an average return ranging from about 3% to about 6% while stocks show an average return of about 13%. The risk in investments between stocks and bonds are shown in the standard deviation. While bonds have lower returns they also are less risky and less volatile than stocks. The volatility of bonds range from about 4% to about 9% while the volatility of stocks is about 20%. 4. Dow 30 Stock | Mean Return | Standard Deviation | ALUMINUM COMPANY AMER | 0.970588 | 6.721026 | ALLIED SIGNAL INC | 2.018627 | 6.450815 | AMERICAN EXPRESS CO | 1.831373 | 7.745903 | AT&T | 1.016667 | 6.36953 | BETHLEHEM STEEL CORP | 0.241176471 | 10.77440452 | BOEING CO | 1.16666667 | 6.62016621 | CHEVRON CORP | 1.332353 | 4.570247 | COCA COLA CO | 2.45 | 5.84709 | DU PONT | 1.732352941 | 6.147432238 | EASTMAN KODAK CO | 1.2627451 | 6.2074041 |...
Words: 1241 - Pages: 5
...variance * standard deviation * interquartile range Measures of statistical dispersion * A measure of statistical dispersion is a nonnegative real number that is zero if all the data are the same and increases as the data become more diverse. If the measurements are in metres or seconds, so is the measure of dispersion. Such measures of dispersion include: * Standard deviation * Interquartile range * Range * Mean difference * Median absolute deviation * Average deviation * Distance standard deviation Range * Is the simple measure of dispersion, which is defined as the difference between the largest value and the smallest value. Mathematically, the absolute and the relative measure of range can be written as the following: R=L – S Where R= Range. L= largest value, S= smallest value Quartile deviation * This is a measure of dispersion. In this method, the difference between the upper quartile and lower quartile is taken is called the interquartile range. Symbolically it is as follows: Mean deviation * Mean deviation is a measure of dispersion, which is known as the average deviation. Mean deviation can be computed from the mean or median. Mean deviation is the arithmetic deviation of different items of central tendency. It may be the mean or the median. Symbolically, mean deviation is defined as the following: Where M= median, = mean Standard deviation * In the measure of dispersion, the standard deviation method is...
Words: 643 - Pages: 3
...equal to 100. Answer: False Difficulty: Easy Goal: 1 4. The total area within any continuous probability distribution is equal to 1.00 Answer: True Difficulty: Easy Goal: 1 AACSB: REF 5. For any continuous probability distribution, the probability, P(x), of any value of the random variable, X, can be computed. Answer: False Difficulty: Medium Goal: 1 6. For any discrete probability distribution, the probability, P(x), of any value of the random variable, X, can be computed. Answer: True Difficulty: Medium Goal: 1 AACSB: AS 7. The uniform probability distribution's standard deviation is proportional to the distribution's range. Answer: True Difficulty: Medium Goal: 2 8. For any uniform probability distribution, the mean and standard deviation can be computed by knowing the maximum and minimum values of the random variable. Answer: True Difficulty: Medium Goal: 2 9. In a uniform probability distribution, P(x) is constant between the distribution's minimum and maximum values. Answer: True Difficulty: Easy Goal: 3 10. For a uniform probability distribution, the probability of any event is equal to 1/(b-a). Answer: False Difficulty: Hard Goal: 3 11. The uniform probability distribution is symmetric about the mode. Answer: False Difficulty: Easy Goal: 3 12. The uniform probability distribution's...
Words: 5111 - Pages: 21
...11. | For the following scores, find the (a) mean, (b) median, (c) sum of squared deviations, (d) variance, and (e) standard deviation: 2, 2, 0, 5, 1, 4, 1, 3, 0, 0, 1, 4, 4, 0, 1, 4, 3, 4, 2, 1, 0 | | A. The mean is 2 B. The median is 2 C. The sum of deviation is 56 D. Variance is 2.667 E. The standard deviation xavg is 2 12. | For the following scores, find the (a) mean, (b) median, (c) sum of squared deviations, (d) variance, and (e) standard deviation: 1,112; 1,245; 1,361; 1,372; 1,472 | | A. The mean is 1312 B. The median is 1361 C. The sum of squared deviation is 76090 D. The variance is 15218 E. The standard deviation is 123.361 (15218) SQRT 13. | For the following scores, find the (a) mean, (b) median, (c) sum of squared deviations, (d) variance, and (e) standard deviation: 3.0, 3.4, 2.6, 3.3, 3.5, 3.2 | | A. The mean is 3.166 B. The median is 3.25 C. The sum of squared deviation is 0.533 D. The variance is 0.089 E. The standard deviation is 0.298 (0.089) SQRT 16. Governors A. The mean is 43 B. The standard deviation is 5.916 CEOS A. The mean is 44 B. The standard deviation is 21.563 In order to figure out the means and standard deviations for each of these you need to first find the means by adding all the numbers up for each then divide them by the number of numbers listed. Next you need to figure out the median by sorting the numbers in ascending order, the median is the middle...
Words: 632 - Pages: 3
...BUSINESS QUANTITATIVE TECHNIQUES. project NAME : JUNAID SHAFQAT SHARMEEN ARSHAD HASSAN ROLL NUM : 12133004 12133009 12133012 PROGRAM : MBA (BANKING & FINANCE) SUBMITTED TO : SIR ABID AWAN ABOUT THE AUTHORS 1st JUNAID SHAFQAT 12133004 3RD SEMESTER MBA (BANKING & FINANCE) 12133004@GIFT.EDU.PK 2ND SHARMEEN ARSHAD 12133009 3RD SEMESTER MBA(BANKING & FINANCE) 12133009@GIFT.EDU.PK 3RD HASSAN 12133012 3RD SEMESTER MBA(BANKING & FINANCE) 12133012@GIFT.EDU.PK Acknowledgement In the name of ALLHA ALMIGHITY the lord of the world who has bestowed us with abilities and blessed with knowledge so that we can make best of opportunities provide to us. First of all we are indebted toward ALLHA ALMIGHTY who has created us and made capable enough to with stand in the competitive world. If words could pay gratitude then we would like to pay our esteem gratitude to our most respected SIR ABID AWAN for assigning us this project of BUSINESS QUANTITATIVE TECHNIQUES. Throughout the course period he has been extremely cooperated with us and guided us at every single step he has been very encouraging and kind to us. At...
Words: 12403 - Pages: 50
...Dispersion and Probability Distributions Shiloh Yard Arizona State University Assignment 2 Article 1 1. What do standard deviations tell us about variables? Meaning, provide an explanation of standard deviation in your own words. [1pt] Standard deviations tell us how far variables are from the mean. They can be used to tell whether variables are lumped close together around the mean or if they are farther away. In definition, standard deviation is a measure of how far or close to the mean values are. 2. Compare the means and standard deviations of the victimization scale...
Words: 1082 - Pages: 5
...PRACTICE PROBLEMS CHAPTER 2 11. For the following scores, find the (a) mean, (b) median,(c) sum of squared deviations,(d) variance and (e) standard deviation: 2, 2, 0, 5, 1, 4, 1, 3, 0, 0, 1, 4, 4, 0, 1, 4, 3, 4, 2, 1, 0 added up =42 divided by 21=(2 is the mean.) 0 0 0 0 0 1 1 1 1 1 2 2 2 3 3 4 4 4 4 4 5= 2 is the median When subtracted by mean the numbers are; 0 0 -2 3 -1 2 -1 1 -2 -2 -1 2 2 2 -2 -1 2 1 2 0 -1 -2 When they are squared they are 0 0 -4 9 -1 4 -1 1 -4 -4 -1 4 4 4 -4 -1 2 1 4 0 -1 -4 added up they = 8 sum of squared deviations 8 divided by 21= 2.6 variances (2.6 (2.6) = 6.76 standard deviation 12. For the following scores, find the (a) mean, (b) median, (c) sum of squared deviations, (d) variance, and (e) standard deviation: 1,112; 1,245; 1,361; 1,372; 1,472 added up =6,562 divided by 5= 1312.4 the mean. 1,361 is the median When subtracted by mean the numbers are 200.4 67.4 -48.6 -59.6 -159.6 When they are squared the number are 14.1 8.2 6.9 7.7 12.6 added up they equal 49.5 sum of squared deviations) 5 divided by 49.5 = 9.9 is the variance.(9.9)(9.9)=98.01 standard deviation 13. For the following scores, find the (a) mean, (b) median, (c) sum of squared deviations, (d) variance, and (e) standard deviation: 3.0, 3.4, 2.6, 3.3, 3.5, 3.2 added up = 19 divided by 6 =3.1mean. 2.6 3.0 3.2 3.3 3.4 3.5 (3.2 & 3.3 added =6.5 divided by 2 =3.25 median when subtracted from mean the numbers are 16 15.6 16.4 15.7 15.5 15.8 when squared they equal...
Words: 1607 - Pages: 7
...o Ch. 2, Practice Problems: 11, 12, 13, 16, and 21 o Ch. 3, Practice Problems: 14, 15, 22, and 25 11 - For the following scores, find the (a) mean, (b) median, (c) sum of squared deviations, (d) variance, and (e) standard deviation: 2, 2, 0, 5, 1, 4, 1, 3, 0, 0, 1, 4, 4, 0, 1, 4, 3, 4, 2, 1, 0 A. 2, 2, 0, 5, 1, 4, 1, 3, 0, 0, 1, 4, 4, 0, 1, 4, 3, 4, 2, 1, 0 Solution: (a) Mean = sum/21 = 42/21 = 2 (b) Arrange the numbers in ascending order 0, 0, 0, 0, 0, 1, 1, 1, 1, 1, 2, 2, 2, 3, 3, 4, 4, 4, 4, 4, 5 Median = middle number = 2 (c) Sum of squared deviations: |x |x-mean |(x-mean)^2 | |2 |0 |0 | |2 |0 |0 | |0 |-2 |4 | |5 |3 |9 | |1 |-1 |1 | |4 |2 |4 | |1 |-1 |1 | |3 |1 |1 | |0 |-2 |4 | |0 |-2 |4 | |1 |-1 |1 | |4 |2 |4 | |4 |2 |4 | |0 |-2 |4 | ...
Words: 1866 - Pages: 8
...QRB 501 WEEK 4 STANDARD DEVIATION A+ Graded Tutorial Available At: http://hwsoloutions.com/?product=qrb-501-week-4-standard-deviation Visit Our website: http://hwsoloutions.com/ Product Description PRODUCT DESCRIPTION QRB 501 week 4 Standard Deviation, Standard Deviation Introduction Standard deviations (SD) and variance are commonly used statistical tools that measure dispersion, risk, and predict certain outcomes in the business world through data. Through decades of academic research, investors and businesses have settled on standardized norms or patterns for various types of calculations, using standard deviations. Data sets, like mean or median, are manipulated to make an inference. This abstract will highlight five articles where the SD is assimilated in mixt conditions or settings. Each article will classify the purpose, any research questions, hypothesis, and the main findings. What to Use to Express the Variability of Data: Standard Deviation or Standard Error of Mean? Statistics is a major element in any industry, failing to provide adequate information to the reader can easily mislead the receivers. Therefore, using the correct highlights to display the variability of data, can minimize error and clarify any study. According to Barde (2012), “It is depressing to find how much good biological work is in danger of being wasted through incompetent and misleading analysis” (p. 113). Case in point, this experiment was based on the hypothesis that applying...
Words: 466 - Pages: 2
...Math 221 Quiz Review for Weeks 5 and 6 1. Find the area under the standard normal curve between z = 1.6 and z = 2.6. 2. A business wants to estimate the true mean annual income of its customers. It randomly samples 220 of its customers. The mean annual income was $61,400 with a standard deviation of $2,200. Find a 95% confidence interval for the true mean annual income of the business’ customers. 3. IQ test scores are normally distributed with a mean of 100 and a standard deviation of 15. An individual's IQ score is found to be 120. Find the z-score corresponding to this value. 4. Two high school students took equivalent language tests, one in German and one in French. The student taking the German test, for which the mean was 66 and the standard deviation was 8, scored an 82, while the student taking the French test, for which the mean was 27 and the standard deviation was 5, scored a 35. Compare the scores. 5. A business wants to estimate the true mean annual income of its customers. The business needs to be within $250 of the true mean. The business estimates the true population standard deviation is around $2,400. If the confidence level is 90%, find the required sample size in order to meet the desired accuracy. 6. The distribution of cholesterol levels in teenage boys is approximately normal with mean = 170 and standard deviation = 30 (Source: U.S. National Center for Health Statistics). Levels above 200 warrant attention. Find the probability that...
Words: 2011 - Pages: 9
...Daniel Egger Handout No. 2 Basic Statistics ! ! 2.1 Topics Covered 2.2 Mean and Median of a Data Set 2.3 Variance and Standard Deviation of a Data Set 2.4 Covariance and Correlation of two Data Sets 2.5 Standard Units (Z‐Scores) and their use for Calculating Correlation 2.6 Slope (Beta) and Y‐Intercept (Alpha) of the regression line of one stocks’s annual returns against annual market return 2.7 Calculating the Expected Return, and Volatility, of a Combination of Assets 2.8 Graphing the Efficient Frontier for Risk‐Averse, Profit‐Maximizing Investors 2.2 Mean and Median of a Data Set The Mean is the average of a set of n known values X = {x1 , x2 ,..., xn } . A sample mean can be written: 1 n x = " xi ! n i=1 (Note that if a “sample mean” and a “population mean” need to be distinguished, x is conventionally used for the sample mean, and µ for the population mean. This distinction will not concern us in Introductory Computational Finance). ! The mean may be calculated using the Excel function AVERAGE. ! The Median is the number in the middle of an ordered set of values; half of all values are greater, and half less. When the total number of values is even, the median is the average of the two numbers in the middle. The median may be calculated using the Excel function MEDIAN. 1 ! 2.3 Variance and Standard Deviation of a Data Set 2 The population Variance of a data set, " (lower case Greek “sigma” squared) ...
Words: 1400 - Pages: 6
...Statistics Name Institution Question 1 of 20 | 5.0 Points | When comparing two population means with an unknown standard deviation you use a t test and you use N-2 degrees of freedom. A. True | B. False | | Reset Selection Question 2 of 20 | 5.0 Points | Pretend you want to determine whether the mean weekly sales of soup are the same when the soup is the featured item and when it is a normal item on the menu. When it is the featured item the sample mean is 66 and the population standard deviation is 3 with a sample size of 23. When it is a normal item the sample mean is 53 with a population standard deviation of 4 and a sample size of 7. Given this information we could use a t test for two independent means. A. True | B. False | | Reset Selection Question 3 of 20 | 5.0 Points | The alternative hypothesis can be proven if the alternative hypothesis is rejected. A. True | B. False | | Reset Selection Question 4 of 20 | 5.0 Points | You want to determine if your widgets from machine 1 are the same as machine 2. Machine 1 has a sample mean of 50 and a population standard deviation 5 and a sample size of 100. Machine 2 has a sample mean of 52 and a population standard deviation of 6 with a sample size of 36. With an alpha of .10 can we claim that there is a difference between the output of the two machines. Which of the following statements are true? A. We will reject the null hypothesis and prove there is a difference between...
Words: 1999 - Pages: 8
...consider the 100 listing prices as a population. • Explain what your computed population mean and population standard deviation were. 2. Divide the 100 listing prices into 10 samples of n=10 each. Each of your 10 samples will tend to be random if the first sample includes houses 1 through 10 on your spreadsheet, the second sample consists of houses 11 through 20, and so on. • Compute the mean of each of the 10 samples and list them: 3. Compute the mean of those 10 means. • Explain how the mean of the means is equal, or not, to the population mean of the 100 listing prices from above. 4. Compute the standard deviation of those 10 means and compare the standard deviation of the 10 means to the population standard deviation of all 100 listing prices. • Explain why it is significantly higher, or lower, than the population standard deviation. 5. Explain how much more or less the standard deviation of sample means was than the population standard deviation. According to the formula for standard deviation of sample means, it should be far less. (That formula is σ = σ/√n = σ/√10 = σ/3.16 ) Does your computed σ agree with the formula? 6. According to the Empirical Rule, what percentage of your sample means should be within 1 standard deviation of the population mean? Using your computed σ, do your sample means seem to conform to the rule?...
Words: 383 - Pages: 2