3. Describing Data Numerically
Standard Deviation
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An economist analyzes the quarterly GDP growth over the past 5 quarters, shown below. Calculate the standard deviation of the data.
A
3.36%
B
0.29%
C
2.50%
D
2.27%
Verified step by step guidance1
Step 1: List all the quarterly GDP growth rates provided in the image: 1.80%, 2.50%, 2.10%, 1.90%, and 2.30%.
Step 2: Convert the percentages into decimal form for easier calculation. For example, 1.80% becomes 0.0180.
Step 3: Calculate the mean (average) of the GDP growth rates. Add all the decimal values together and divide by the number of quarters (5).
Step 4: Find the variance by calculating the squared difference between each GDP growth rate and the mean, then averaging these squared differences.
Step 5: Calculate the standard deviation by taking the square root of the variance obtained in the previous step.
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