What is three sigma - Definition and Meaning
Three Sigma :
The three sigma rule states that, in a normal distribution, almost all the values remain within three standard deviations of the mean. Three sigma rule is also known as empirical rule.
Formula :
Avg = Dataset/N
S = Dataset-Avg; [list of values]
Square = S2; [list of values]
Avgnew+ = Square
Variance = Avgnew/N;
Sigma = √variance
Threesigma = 3*sigma
Example :
The following are the points obtained by the players in a game 11,10,9,10.2,15.7. Find the variance and 3sigma.
Given :
Data Set = 11,10,9,10.2,15.7
N (N) = 5
To Find :
Variance and Three sigma
Solution :
Avg = 11.18
| S | Square | Avgnew |
|---|
| -0.18 | 0.032 | 0.0324 |
| -1.18 | 1.392 | 1.4248 |
| -2.18 | 4.752 | 6.1772 |
| -0.98 | 0.960 | 7.1376 |
| 4.51 | 20.43 | 27.5679 |
Variance = 5.5136
3sigma = 7.0443
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