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The number of the pencil is based on the type of carbon lead used inside. The thicker the carbon lead gets the higher the number of the pencil becomes. If you notice a mechanical pencil is 0.9mm in diameter so it would be called a #0.9 pencil. A #2 pencil's lead is 2mm in diameter. So Why would we call a pencil a #3 pencil? Because it's lead is 3mm in diameter.
Actually, what you are asking is referring to the hardness of the pencil. So both, 0.5mm and 0.7mm are the same hardness as number two pencils. The number of lead, 0.5, is a thinner lead in diameter to the 0.7.
A standard number 2 pencil typically measures 7.5 inches in length when unsharpened. The diameter of the pencil is generally around 0.3 inches. This size is commonly used for standardized tests and general writing purposes.
An ordinary pencil is one example.
For finding accurate volume of a pencil use a vernier calliper, which measures diameter up to two significant figures. For finding volume of a pencil you will need radius (r) and length (L) of the pencil. V = 3.14 r²L