Measures of Dispersion

Measures of variation measure

the variation present among the
values of a data set, so measures
of variation are measures of
spread of values in the data.

Absolute Measures of
Dispersion
Range
Quartile Deviation
Mean Deviation
Variance and Standard Deviation

Range
Difference between the
largest and the smallest
observations
Range X Largest X Smallest

Disadvantages of the Range

Ignores

the way in which data are

distributed

10

11

Range = 12 - 7 = 5

12

10

11

12

Range = 12 - 7 = 5

Sensitive
to outliers
1,1,1,1,1,1,1,1,1,1,1,2,2,2,2,2,2,2,2,3,3,3,3,4,5
Range = 5 - 1 = 4

1,1,1,1,1,1,1,1,1,1,1,2,2,2,2,2,2,2,2,3,3,3,3,4,120
Range = 120 - 1 = 119
4

Variance
Variance is the
average of the
squared deviations
taken from the mean
value.
(i) S

(ii ) S

(x x )

102
17cm 2
6

5:50 AM

X cm

(X-Mean)^2

X2

36

16

16

36

81

12

144

13

169

36

256

102

702

702 102 2
2 16

17 cm
6 6

60

Standard Deviation

Standard deviation is the positive square

root of the mean-square deviations of the
observations from their arithmetic mean.
Population

Sample

SD variance

x
i

N 1

Standard Deviation for Group

Data

SD is :

f i xi x 2

Where

fx
N

i i
i

Simplified formula
2

fx

x
f

fx
N

Example-1: Find Standard

Deviation of Ungroup Data

Family
No.

10

Size (xi)

Here, x
n

Family No.

50

5
10

10

Total

xi

50

xi x

-2

-2

-1

-1

20

16

16

25

25

36

36

49

49

270

x i x
xi

s2

x
i

20
2
10

s 2 1.41

Comparing Standard
Deviations
Data A
11

12

13

14

15

16

17

18

19

20 21

Mean = 15.5
S = 3.338

20 21

Mean = 15.5
S = 0.926

Data B
11

12

13

14

15

16

17

18

19

Data C
Mean = 15.5
S = 4.567
11 12 13 14 15 16 17 18 19 20 21
The smaller the standard deviation, the more tightly
clustered the scores around mean
The larger the standard deviation, the more spread out
the scores from mean
10

Coefficient of Variation (CV)

S
100%
CV

X
Can be used to compare two or
more sets of data measured in
different units or same units but
different average size.
11

Use of Coefficient of Variation

Stock A:
Average price last year = $50
Standard deviation = $5
S
$5
CVA 100%
100% 10%
$50
X
Stock B:
Average price last year = $100
Standard deviation = $5

S
$5
CVB 100%
100% 5%
$100
X

Both stocks
have the
same
standard
deviation

but stock B is
less variable
relative to its
price

12

The Empirical
Rule
68%
X 1S contains about 68% of values

X
X 1S

X 2S contains about 95% of values

95%

X 2S
99.7%

X 3S

X 3S containsabout99.7%of values
13

Measures of
Skewness
A distribution in which the values
equidistant from the centre have equal
frequencies is defined to be symmetrical
and any departure from symmetry is called
skewness.
1.

Length of Right Tail = Length of Left Tail

2.

Mean = Median = Mode

3.

Sk=0
a) Sk=(Mean-Mode)/SD
b) Sk=(Q3-2Q2+Q1)/(Q3-Q1)

14

Measures of
Skewness
A distribution is positively skewed, if the
observations tend to concentrate more at the
lower end of the possible values of the variable
than the upper end. A positively skewed
frequency curve has a longer tail on the right
hand side

1.

Length of Right Tail > Length of Left Tail

2.
3.

Mean > Median > Mode

SK>0

15

Measures of
Skewness
A distribution is negatively skewed, if the
observations tend to concentrate more at
the upper end of the possible values of the

variable than the lower end. A negatively

skewed frequency curve has a longer tail
on the left side.

1.

Length of Right Tail < Length of Left Tail

2.

Mean < Median < Mode

3.

SK< 0

16

Measures of Kurtosis

The Kurtosis is the degree of peakedness or flatness of a

unimodal (single humped) distribution,
When the values of a variable are highly concentrated
around the mode, the peak of the curve becomes relatively
high; the curve is Leptokurtic.
When the values of a variable have low concentration
around the mode, the peak of the curve becomes relatively
flat;curve is Platykurtic.
A curve, which is neither very peaked nor very flat-toped,
it is taken as a basis for comparison, is called
Mesokurtic/Normal.
17

Measures of Kurtosis

18