The standard deviation we obtain by sampling a distribution is itself not absolutely accurate, both for mathematical reasons (explained here by the confidence interval) and for practical reasons of measurement (measurement error). The mathematical effect can be described by the confidence interval or CI. To show how a larger sample will make the confidence interval narrower, consider the following examples: A small population of N = 2 has only 1 degree of freedom for estimating the standard deviation. The result is that a 95% CI of the SD runs from × SD to × SD; the factors here are as follows :
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Inflation is one of the primary reasons that people invest in the first place. Just as the pack of gum that costs a dollar will cost $ in a year, assuming 2% inflation, a savings account that was worth $1,000 would be worth $ after 5 years, and $ after 10 years, assuming that you earn no interest on the deposit. Stuffing cash into a mattress, or buying a tangible asset like gold, may make sense to people who live in unstable economies or who lack legal recourse. However, for those who can trust that their money will be reasonably safe if they make prudent equity or bond investments, this is arguably the way to go.