BUSINESS ADMINISTRATION
BUSINESS ECONOMICS
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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Compared to the formula for determining the population variance, the formula for determining the sample variance is ____
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exactly same
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totally different
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similar except for (n-1) in the denominator instead of N
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similar except for (n + 1) in the denominator instead of N
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Explanation:
Detailed explanation-1: -Thus, the sample variance is more than population variance. Since a small sample drawn from a large population cannot represent the corresponding population absolutely, the formula for sample variance incorporates this possibility of margin of error and hence its value is always more than population variance.
Detailed explanation-2: -WHY DOES THE SAMPLE VARIANCE HAVE N-1 IN THE DENOMINATOR? The reason we use n-1 rather than n is so that the sample variance will be what is called an unbiased estimator of the population variance 2.
Detailed explanation-3: -Basically, you should use N-1 when you estimate a variance, and N when you compute it exactly.
There is 1 question to complete.