A dataset of employee salaries has a standard deviation of . If every salary in the dataset is multiplied by and then increased by , what is the standard deviation of the resulting dataset?
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Answer
The standard deviation of the resulting dataset is .
Multiplying each data point by increases the spread around the mean by a factor of , changing the standard deviation from to . Adding to each value shifts all values by the same amount, which leaves the distance between data points and the mean unchanged. Thus, the standard deviation remains .
Step-by-Step Solution
Key Concept
Linear Transformations on Standard Deviation
Estimated Time:45s