Statistics: Variance
Questions involving Variance are very rare on the GMAT.
Variance is simply the square of standard deviation (STD)2.
The formula for calculating the Variance is given in:
$$\mbox{Variance} = \frac{({x_1} - \overline{x})^2 + ({x_2} - \overline{x})^2 + {.....} +({x_N} - \overline{x})^2}{N}$$
Where x1, x2,...xN are the members of the set of data, x¯ is the mean (average) of the set, and N is the number of members in the set.
As with standard deviation, GMAT problems will not require you to calculate the Variance of a data set, but rather test your understanding of what a variance IS. For the purposes of the GMAT, the two are similar in function - both are measures of the dispersion of a set of data around the mean.
A low Variance indicates that all of the data points are very close to the same value (the mean), while high Variance indicates that the data are “spread out” over a large range of values.
