Variance Estimation

Variance estimation is a statistical method used to measure how much a set of values diverges from the average. In simple terms, it helps us understand how spread out or clustered together a group of data points is. For example, if you have test scores from a class, variance indicates whether most students scored similarly or if there was a wide range of results. A high variance means scores vary greatly, while a low variance means they are more similar. Estimating variance is essential for making informed decisions based on data, such as assessing risks or predicting future outcomes.