
122    Chapter 3
The variance and standard deviation measure 
how values are dispersed by looking at how far 
values are from the mean.
The variance is calculated using 
 
   
An alternate form is 
 
 
The standard deviation is equal to the square root 
of the variance, and the variance is the standard 
deviation squared.
Standard scores, or z-scores, are a way of 
comparing values across different sets of data 
where the means and standard deviations are 
different. To find the standard score of a value x, 
use:
 x
2 
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2
n
Q:
 So variance and standard deviation both measure the 
spread of your data. How are they different from the range?
A: The range is quite a simplistic measure of the spread of your 
data. It tells you the difference between the highest and lowest 
values, but that’s it. You have no way of knowing how the data is 
clustered within it. 
 
The variance and standard deviation are a much better way 
of measuring the variability of your data and how your data is 
dispersed, as they take into account how the data is clustered. 
They look at how far values typically are from the center of 
your data.
Q:
 And what’s the difference between variance and 
standard deviation? Which one should I use?
A: The standard deviation is the square root of the variance, 
which means you can find one from the other. 
 
The standard deviation is probably the most intuitive, as it tells you 
roughly how far your values are, on average, from the mean.
Q:
 How do standard scores fit into all this?
A: Standard scores use the mean and standard deviation to 
convert values in a data set to a more generic distribution, while at 
the same time, making sure your data keeps the same basic shape.  
 
They’re a way of comparing different values across different data 
sets even when the data sets have different means and standard 
deviations. They’re a way of measuring relative standing.
Q:
 Do standard scores have anything to do with detecting 
outliers?
A:
 Good question! Determining outliers can be subjective, but 
sometimes outliers are defined as being more than 3 standard 
deviations of the mean. Statisticians have different opinions about 
this though, so be warned.
no dumb questions
 (x
 
-  )
2
n
x
 
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z =