Empirical Rule
Categories: Metrics, Accounting
Also known as the 68-95-99.7% Rule, which is waaaaay less catchy than the “empirical rule.” Seriously, say both of them out loud. Empirical rule sounds so much cooler.
On any kind of Normal Distribution, a.k.a. The Bell Curve (even the ultra-fancy Standard Normal Distribution), 68% of the data in the distribution lies between +1 and -1 standard deviations, 95% of the data in the distribution lies between +2 and -2 standard deviations, and 99.7% of the data in the distribution lies between +3 and -3 standard deviations.
As it turns out, the weights of Gummi Bear-covered Pretzel Logs are Normally distributed with a mean of 14.2 grams and a standard deviation of 0.12 grams. Which means that 68% of the Gummi Bear-covered Pretzel Logs that come off the production line are between the weights of 14.2 – 0.12 = 14.08 grams and 14.2 + 0.12 = 14.32 grams.
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