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Variance

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Intro to Statistics

Definition

Variance is a measure of how much the values in a data set differ from the mean. It quantifies the spread or dispersion of the data.

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5 Must Know Facts For Your Next Test

  1. The formula for variance in a population is $$\sigma^2 = \frac{\sum (x_i - \mu)^2}{N}$$ and for a sample is $$s^2 = \frac{\sum (x_i - \bar{x})^2}{n-1}$$.
  2. A high variance indicates that data points are spread out over a large range of values.
  3. A low variance indicates that data points are close to the mean.
  4. Variance is always non-negative because it is the average of squared deviations.
  5. Variance units are the square of the units of the original data.

Review Questions

  • What does a high variance signify about a dataset?
  • How does one calculate variance for a sample versus a population?
  • Why can variance never be negative?

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