If each of the observation x1,x2,...,xnx_{1}, x_{2}, ..., x_{n} is increased by ' aa ', where aa is a negative or positive number, show that the variance remains unchanged.

Answer: The variance remains unchanged.

Step-by-step solution

Step 1: Define original mean and variance

Let's start by defining the mean and variance for the original set of observations x1,x2,...,xnx_1, x_2, ..., x_n. The mean, denoted by xˉ\bar{x}, is the sum of all observations divided by the number of observations nn. The variance, denoted by σ2\sigma^2, is the average of the squared differences from the mean.

Step 2: Define new observations and their mean

Now, let's consider the new set of observations, y1,y2,...,yny_1, y_2, ..., y_n, where each observation xix_i is increased by 'a'. So, yi=xi+ay_i = x_i + a. We then calculate the mean of these new observations, yˉ\bar{y}.

Step 3: Simplify the new mean

We can simplify the expression for the new mean yˉ\bar{y}. By distributing the summation and recognizing that ∑i=1na=na\sum_{i=1}^{n} a = na, we find that the new mean is simply the original mean plus 'a'.

Step 4: Calculate the new variance

Now, let's calculate the variance for the new set of observations, σy2\sigma_y^2. This is defined as the average of the squared differences between each new observation yiy_i and the new mean yˉ\bar{y}.

Step 5: Substitute and simplify the new variance

Substitute yi=xi+ay_i = x_i + a and yˉ=xˉ+a\bar{y} = \bar{x} + a into the variance formula. Notice that the 'a' terms cancel out inside the parenthesis. This leaves us with the exact same expression as the original variance.

Step 6: Conclusion

Since the formula for σy2\sigma_y^2 is identical to the formula for σ2\sigma^2, we have shown that the variance remains unchanged when each observation is increased by a constant 'a'.

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