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If a random variable x has standard deviation σ, then what is the standard deviation of the transformed variable (ax + b) / c, where a, b, and c are constants?
- (a/c)σ
- |a/c|σ
- (a²/c²)σ
- None of these
Correct answer: |a/c|σ
Solution
Adding a constant b shifts data without changing spread, while multiplying by a/c scales the SD by the absolute value. So SD((ax+b)/c) = |a/c|·sigma.
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