Suppose there exists a set of obsevation whose variance is 11. If each term of this set is multiplied by 3, then find the new variance of this set.
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So, lets derive a general formula:-
Let x i = x 1 , x 2 , x 3 , ⋯ be n values of variable X .
Let k i = k 1 , k 2 , k 3 , ⋯ be n values of variable K such that k i = y x i where y is any non-zero real number.
If K be the mean of the obversations of k i and X be the mean of the observations of x i .
K K k i − K k i − K ( k i − K ) 2 i = 1 ∑ n ( k i − K ) 2 n 1 i = 1 ∑ n ( k i − K ) 2 n 1 i = 1 ∑ n ( k i − K ) 2 Var(K) = n 1 i = 1 ∑ n k i = n 1 i = 1 ∑ n y x i = n 1 × i = 1 ∑ n x i × n y = y ( i = 1 ∑ n x i ) = y X = y x i − y X ( because k i = y x i ) = y ( x i − x ) = y 2 ( x i − X ) 2 ( Squaring on both sides ) = y 2 i = 1 ∑ n ( x i − X ) 2 = n 1 y 2 i = 1 ∑ n ( x i − X ) 2 = y 2 ( n 1 i = 1 ∑ n ( x i − X ) 2 ) = y 2 Var(X)
So, this means if we multiply any set of observations by any non-zero real number y , the variance increases y 2 times.
So, in the given question observations are multiplied by 3 .
So, new variance will be:-
1 1 × 3 2 = 1 1 × 9 = 9 9