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Variation

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Intro to Business Statistics

Definition

Variation refers to the differences or changes in data points within a dataset. It is a crucial concept for understanding the spread and distribution of data.

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5 Must Know Facts For Your Next Test

  1. Variation can be measured using statistical tools such as variance, standard deviation, and range.
  2. High variation indicates that data points are spread out widely around the mean, while low variation shows that they are closely clustered around the mean.
  3. In sampling, variation can arise due to random sampling errors and can affect the accuracy of your estimates.
  4. A larger sample size generally reduces the impact of variation caused by random sampling errors.
  5. Understanding variation helps in making informed decisions by assessing the reliability and consistency of data.

Review Questions

  • What are some common statistical measures used to quantify variation?
  • How does high variation differ from low variation in terms of data spread?
  • Why is understanding variation important when analyzing sample data?
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