ALIPURDUAR GOVERNMENT
ENGINEERING AND
MANAGEMENT COLLEGE
TOPIC : MEASURE OF
DISPERSION
NAME : ANJAMUL ISLAM
ROLL NO : 38732524013
SUB : MATHEMATICS(BS-
M201)
DEPT : ARTIFICIAL
MEASURE
OF
DISPERSION
: TABLE OF CONTENT :
• INTRODUCTION
• DEFINATION AND IMPORTANCE
• SUMMARY
• TYPES OF MEASURE OF
DISPERSION
• APPLICATION
• CONCLUSION
• REFERENCE
INTRODUCTION :
• The measure of dispersion helps in understanding how spread-
out data points are in a dataset.
• It provides insights into the consistency and reliability of data.
• Different types of dispersion measures (Range, Variance,
Standard Deviation, IQR) give different perspectives on data
variability.
DEFINATION AND IMPORTANCE :
• Measures of dispersion indicate how much variation or spread
exists within a dataset.
• It is essential in fields such as finance, science, and economics
for making accurate predictions.
• A low dispersion suggests that data points are close to the
mean, while high dispersion indicates greater variability.
SUMMARY
MEASURE DEFINATION FORMULA USE CASE
RANGE Difference between Max – Min Simple spread
max and min value measure
VARIANCE Average squared Measure data
deviation from mean variability
STANDARD Square root of Common dispersion
DEVIATION variance metric
QUARTILE Spread of middle Q3 – Q1 Robust measure of
DEVIATION 50%of data spread
COEFFICIENT OF Relative dispersion Used for comparing
VARIATION measure datasets
TYPES OF MEASURES OF
DISPERSION
[Link] Measures (expressed in original units of data):
1. Range: Measures the difference between the maximum and minimum values.
2. Variance: Measures how far each data point is from the mean.
3. Standard Deviation: The square root of variance, indicating spread.
4. Quartile Deviation: Measures spread within the middle 50% of data.
[Link] Measures (expressed as ratios or percentages):
1. Coefficient of Variation: Standard deviation relative to the mean.
2. Coefficient of Quartile Deviation: Ratio of interquartile range to the sum of quartiles.
RANGE :
• Definition: The simplest measure of dispersion,
calculated as the difference between the highest
and lowest values in a dataset.
• Formula: Range = Max Value - Min Value STANDARD DEVIATION :
• Example: Given dataset [2, 5, 8, 10], Range =
• Definition: The square root of variance,
10 - 2 = 8
providing a more interpretable measure of
• Limitation: Affected by extreme values and does spread.
not consider data distribution.
• Formula:
VARIENCE :
• Definition: Measures how much each value in • Use Case: Helps in understanding
the dataset differs from the mean. deviation from the mean in real-world
scenarios, such as stock price volatility.
• Formula:
• Example: Calculation using a sample
• Example: Step-by-step variance calculation for dataset.
a sample dataset.
• Importance: High variance means greater
variability; low variance means more
consistency.
QUARTILE DEVIATION ( INTERQUARTILE RANGE – IQR) :
• Definition: Measures the spread of the middle 50% of data, reducing the effect of extreme
values.
• Formula: IQR = Q3 - Q1
• Example: Given dataset [1, 3, 5, 7, 9], Q1 = 3, Q3 = 7 → IQR = 7 - 3 = 4
• Importance: More robust than range in measuring data spread.
COEFFICIENT OF VARIATION (CV) :
• Definition: A relative measure of dispersion that allows comparison between datasets with
different units.
𝜎
• Formula: 𝐶𝑉 = 𝜇 × 100 %
• Example: Comparing the variability of stock returns of two companies.
• Importance: Useful for risk assessment in finance and economics.
APPLICATION OF DISPERSION MEASURESS :
• Business and Finance: Used for risk assessment in stock markets and financial
forecasting.
• Quality Control: Helps in maintaining product consistency in manufacturing.
• Economics: Assesses income inequality by measuring variation in earnings.
• Medical Research: Determines variations in patient responses to treatments.
CONCLUSION :
• Measures of dispersion help in understanding data variability.
• Each measure has its strengths and is chosen based on data type and
purpose.
• A combination of measures provides a comprehensive view of data
distribution.
REFERENCE :
1. Montgomery, D. C., & Runger, G. C. (2020). Applied Statistics and Probability for Engineers (7th ed.). Wiley.
2. McClave, J. T., & Sincich, T. (2018). Statistics (13th ed.). Pearson Education.
3. [Link]
4. [Link]
5. [Link]
6. Gupta, S. C., & Kapoor, V. K. (2014). Fundamentals of Mathematical Statistics. Sultan Chand & Sons.
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