Variance measures how spread out the data points are from the mean. It quantifies the average squared deviation from the mean.
Types of Variance:
- • Population Variance (σ²): Uses N as denominator
- • Sample Variance (s²): Uses (n-1) as denominator (Bessel's correction)
- • Standard Deviation: Square root of variance
Applications:
- • Quality control and process monitoring
- • Financial risk assessment
- • Scientific research and experiments
- • Performance analysis and comparison