# Statistics – Unit 3

Posted by on May 31, 2019

Unit 3

Topics:

What is Central Tendency? link:What is Central Tendency

• Learning Objectives
1. Identify situations in which knowing the center of a distribution would be valuable
2. Give three different ways the center of a distribution can be defined
3. Describe how the balance is different for symmetric distributions than it is for asymmetric distributions.

Measures of Central Tendency link:Measures of Central Tendency

• Learning Objectives
1. Compute mean
2. Compute median
3. Compute mode

Median and Mean link:Median and Mean

• Learning Objectives
1. State when the mean and median are the same
2. State whether it is the mean or median that minimizes the mean absolute deviation
3. State whether it is the mean or median that minimizes the mean squared deviation
4. State whether it is the mean or median that is the balance point on a balance scale

• Learning Objectives
1. Compute the trimean
2. Compute the geometric mean directly
3. Compute the geometric mean using logs
4. Use the geometric to compute annual portfolio returns
5. Compute a trimmed mean

Comparing Measures of Central Tendency link:Comparing Measures

• Learning Objectives
1. Understand how the difference between the mean and median is affected by skew
2. State how the measures differ in symmetric distributions
3. State which measure(s) should be used to describe the center of a skewed distribution

• Learning Objectives
1. Determine the relative variability of two distributions
2. Compute the range
3. Compute the inter-quartile range
4. Compute the variance in the population
5. Estimate the variance from a sample
6. Compute the standard deviation from the variance

• Learning Objectives
1. Compute skew using two different formulas
2. Compute kurtosis

Effects of Linear Transformations link:Effects of Linear Transformations

• Learning Objectives
1. Define a linear transformation
2. Compute the mean of a transformed variable
3. Compute the variance of a transformed variable

Variance Sum Law I link:Variance Sum Law

• Learning Objectives
1. Compute the variance of the sum of two uncorrelated variables
2. Compute the variance of the difference between two uncorrelated variables

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