Do you know why we divide with N-1 while calculating Variance..
This article will walk you through the reason why we use N-1 in the denominator while calculating the variance instead of N.
If you divide by N than it will lead to a biased estimate because you will end up underestimating the true value of the Standard Deviation in the population
Must be wondering Why N leads to a biased estimate? — The whole thing revolves around the concept of Degrees of freedom.
The degree of freedom takes into account the number of constraints in computing an estimate. Here since Variance is dependent on the calculation of the sample means, therefore we have one constraint, hence the degree of freedom is N-1.
Therefore, if you divide by N-1 then the Standard deviation becomes an unbiased estimate.
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