Quantitative Techniques in Management - blck2

Summary Statistics 23
Notes
Unit 2: Summary Statistics
Structure:
2.1 Introduction to Measures of Central Tendency
2.2 Average
2.3 Types of Averages
2.4 Arithmetic Mean
2.5 Median
2.6 Mode
2.7 Measure of Dispersion
2.8 Types/Methods of Dispersion
2.9 Range
2.10 Average Deviation / Mean deviation
2.11 Standard Deviation (SD or )
2.12 Summary
2.13 Check Your Progress
2.14 Questions and Exercises
2.15 Key Terms
2.16 Check Your Progress: Answers
2.17 Case Study
2.18 Further Readings
2.19 Bibliography
Objectives
After studying this unit, you should be able to understand:

 Concept of Measures of Central Tendency
 Meaning, merits and demerits of Arithmetic Mean and Weighed Mean
 Meaning, merits and demerits of Median and Mode
 Concept of Measures of Dispersion
 Concept of Range
 Concept of Average Deviation and Standard Deviation
 Overview of Variance and Coefficient of Variation
Amity Directorate of Distance and Online Education

24 Quantitative Techniques in Management
Notes 2.1 Introduction to Measures of Central Tendency

Measures of central tendency is a single value which can be considered as
representative of a set of observations and around which the observations can be
considered as Centered is called an ’Average’ (or average value) or a Center of location.
Since such representative values tend to lie centrally within a set of observations when
arranged according to magnitudes, averages are called measures of central tendency.
2.2 Average
An average is a single figure which sums up the characteristics of a whole group
of figures. In the words of clark “average is an attempt to find one single figure to describe
whole of figures.
An average is described as a measure of central tendency as it is more or less a
central value around which various values cluster. In the world of CROXTON and COWDEN
“an average is a single value within the range of the data that is used to represent all
of the values in the series. Since an average is somewhere within the range of the data,
it is called a measure of cultural value.
Objectives served by Averages
Averages serves the following purposes:

1. To obtain a clear and concise picture of a large number of numerical data.
2. To compare different groups by means of averages.
3. To obtain a clear picture of a whole group by the study of sample data.
4. To give a definite rates to the relationship between different groups.
Characteristics or requisites or properties of good average
1. It is rigidly defined. Its value is always definite.

2. It is easy to calculate and easy to understand. Hence it is very popular.
3. It is based on all the observations; so that it becomes a good representative.
4. It can be easily used for comparison.
5. It is capable of further algebraic treatment such as finding the sum of the values
of the observations, if the mean and the total number of the observations are
given; finding the combined arithmetic mean when different groups are given etc.
6. It is not affected much by sampling fluctuations. Hence sampling stability
Essentials of a good Average
The essentials of a good average are as follows:

1. It should be rigidly defined.
2. It should be based on all the observation of the data.
3. It should be readily comprehensible or understandable.
4. It should be capable of being calculated with reasonable ease and rapidity.
5. It should be affected as little as possible by fluctuations of sampling.
6. It should be readily amenable to arithmetic or algebraic treatment.

2.3 Types of Averages Notes

(1) Arithmetic mean
(2) Median
(3) Mode
(4) Geometric mean
(5) Harmonic mean
2.4 Arithmetic Mean

Arithmetic mean is defined as the value obtained by dividing the total values of all
items in the series by their number.
In other word is defined as the sum of the given observations divided by the number
of observations, i.e., add values of all items together and divide this sum by the number
of observations.
Symbolically
 x1  x2  x3  ............. x n
Symbolically x 
n
Merits of Arithmetic Mean

1. It is rigidly defined. Its value is always definite.
2. It is easy to calculate and easy to understand. Hence it is very popular.
3. It is based on all the observations; so that it becomes a good representative.
4. It can be easily used for comparison.
5. It is capable of further algebraic treatment such as finding the sum of the values
of the observations, if the mean and the total number of the observations are
given; finding the combined arithmetic mean when different groups are given etc.
6. It is not affected much by sampling fluctuations.
Demerits of Arithmetic Mean

1. Arithmetic mean is affected very much by extreme values.
2. It cannot be determined by inspection nor it can be located graphically.
3. Arithmetic mean cannot be obtained if a single observation is missing or lost.
4. We cannot calculate it when open-end class intervals are present in the data.
Properties of Arithmetic Mean

1. The sum of the deviations, of all the values of x, from their arithmetic mean,
is zero.
2. The product of the arithmetic mean and the number of items gives the total of
all items.
3. Finding the combined arithmetic mean when different groups are given.

Notes Arithmetic Mean for Ungrouped Data
A) Individual Series
1. Direct Method
The following steps are involved in calculating arithmetic mean under individual series
using direct method:
1. Add up all the values of all the items in the series.
2. Divide the sum of the values by the number of items. The result is the arithmetic
mean.
The following formula is used:
x
X = N
where, X = Arithmetic mean

x = Sum of the values
N = Number of items.
Illustration - 1
Value (x): 125 128 132 135 140 148 155 157 159 161
Solution:
Calculation of arithmetic mean:
Sl. No. Value (x)

A 125
B 128
C 132
D 135
E 140
F 148
G 155
H 157
I 159
J 161
N = 10 x = 1,440
x 1,440
X  = 144
n 10
Illustration - 2
The monthly income of ten families of a certain locality are given in rupees as below:

Family A B C D E F G H I J Notes
Income (in `) 850 700 440 750 500 800 420 2500 2300 1500
Calculate the arithmetic mean.
Solution:
Calculation of arithmetic mean:
Family Income (in `)

A 850
B 700
C 840
D 750
E 500
F 800
G 420
H 2,500
I 2,300
J 1,500
N = 10 x = 11,160
 x 11160
X =  = 1,116
N 10
The average income of 10 families is ` 1,116
2. Short-cut Method or Indirect method
The following steps are involved in calculating arithmetic mean under individual series
using short-cut or indirect method:
1. Assume one of the values in the series as an average. It is called as working
mean or assumed average.
2. Find out the deviation of each value from the assumed average.
3. Add up the deviations
4. Apply the following formula.
d
X = A
N
where, X = Arithmetic mean
A = Assumed average
d = Sum of the deviations
N = Number of items

Notes Illustration - 1
Calculate the arithmetic average of the data given below using short–cut method.
Roll No. 1 2 3 4 5 6 7 8 9 10
Marks obtained. 43 48 65 57 31 60 37 48 78 59
Solution:
Calculation of Arithmetic mean:
Roll No. Marks obtained d = 60
1 43 – 17
2 48 – 12
3 65 +5
4 57 –3
5 31 – 29
6 60 0
7 37 – 23
8 48 – 12
9 78 + 18
10 59 –1
d = – 74
d 74FG IJ
X = a
N
 60  
10 H K = 60 – 7.4 = 52.6 marks.
Illustration - 2
The following data relates to sizes sold at a store during a given week. Find the
average size by the short cut method.
Size of store No. of pairs
4.5 1
5 2
5.5 4
6 5
6.5 15
7 30
7.5 60
8 82
8.5 82
9 75
9.5 44
10 25
10.5 15
11.0 4

Solution: Notes
Calculation of Arithmetic mean:
Size of stores No. of pairs d = (x-a) fd

4.5 1 – 3.5 – 3.5
5 2 –3 –6
5.5 4 – 2.5 – 10
6 5 –2 – 10
6.5 15 – 1.5 – 22.5
7 30 –1 – 30
7.5 60 – 0.5 – 30
8 82 0 +0
8.5 82 + 0.5 + 41
9 75 +1 + 75
9.5 44 + 1.5 + 66
10 25 +2 + 50
10.5 15 + 2.5 + 37.5
11.0 4 +3 + 12
N = 444 fd = 169.5
 fd 169.5
X = a 8
N 444
= 8 + 0.38 = 8.38
The average size of stores sold is 8.4
Illustration - 3
From the following figures find the mean using indirect method.
Marks No.of persons.
0 – 10 5
10 – 20 10
20 – 30 20
30 – 40 40
40 – 50 30
50 – 60 20
60 – 70 10
70 – 80 4

Notes Solution:
Calculation of mean:
Marks Mid values No.of persons d = (x-a) fd

0 – 10 5 5 – 40 – 200
10 – 20 15 10 – 30 – 300
20 – 30 25 20 – 20 – 400
30 – 40 35 40 – 10 – 400
40 – 50 45 30 0 0
50 – 60 55 20 + 10 + 200
60 – 70 65 10 + 20 + 200
70 – 80 75 4 + 30 + 120
N = 139 fd = – 780
 fd 780 FG IJ
X =
a
N
 45 
139 H K
= 45 + ( – 5.6) = 39.4 marks
3. Step deviation Method
The following steps are involved in computing mean under step deviation method:
1. Find out the mid–value of each group or class.
2. Assume one of the mid–values as an average.
3. Find out the deviation of each mid–value from the assumed average in terms
of class interval.
4. Multiplying the deviation of each class by its frequency.
5. Add up the products.
6. Apply the following formula
 fd
X = A i
N
where X = Arithmetic mean
A = Assumed average
fd = Sum of the deviations in terms of class interval
N = Total frequency
i = Class interval
Illustration - 1
Calculate the average marks from the following distribution

Marks: 0-5 5-10 10-15 15-20 20-25 25-30 30-35
No. of students: 2 4 5 3 2 4 5

Solution: Notes
xA
Marks (CI) No. student(f) Midvalue(x) d= fd
5
0-05 2 2.5 -3 -6
5-10 4 7.5 -2 -8
10-15 5 12.5 -1 -5
15-20 3 17.5 0 0
20-25 2 22.5 +1 +2
25-30 4 27.5 +2 +8
30-35 5 32.5 +3 +15
n = 25 d = 0 fd = 6
Using step deviation formula Assumed Mean (A) = 17.5
Common factor (i) is 5
fd 6 30
x = A i = 17.5 + 5 = 17.5 +
n 25 25
= 17.5 + 1.2 = 18.7
B) Discrete Series
In the discrete series, every term (i.e. value of x) is multiplied by its corresponding
frequency (fx) and then their total (sum)  fx is divided by the total frequency (N) or  f .
1. Direct Method

 fx
Formula: x 
n
Illustration - 1
Marks obtained by students of a class in statistics calculate Arithmetic Mean

Marks 35 40 45 50 55 60 65 70 75 80 85 90 95
No. of students 3 8 12 9 4 7 15 5 10 7 5 3 2
Solution:
Marks No. of fx
(x) Students (f)
35 3 105
40 8 320
45 12 540
50 9 450
55 4 220
60 7 420
65 15 975
Notes 70 5 350
75 10 750
80 7 560
85 5 425
90 3 270
95 2 190
N = 90  fx = 5,575

 fx 5,575
x = = 61.95
n 90
2. Indirect Method

 fdx
Formula: x 
n
Illustration - 1

Marks 35 40 45 50 55 60 65 70 75 80 85 90 95
No. of students 3 8 12 9 4 7 15 5 10 7 5 3 2
Solution:
Marks No. of (x - A) = dx fdx

(x) Students (f)
35 3 -30 -90
40 8 -25 -200
45 12 -20 -240
50 9 -15 -135
55 4 -10 -40
60 7 -5 -35
65(A) 15 0 0
70 5 5 25
75 10 10 100
80 7 15 105
85 5 20 100
90 3 25 75
95 2 30 60
N = 90  fdx = -275

 fdx -275
x  = 60 + = 60 - 3.05 = 56.95
n 90

3. Step deviation Method Notes


 fdx
Formula: x  A  i
n
Illustration - 1

Marks 35 40 45 50 55 60 65 70 75 80 85 90 95
No. of students 3 8 12 9 4 7 15 5 10 7 5 3 2
Solution:
x  A
x f dx = c
(i = 5) fdx
35 3 (35 – 65) –30/5 –6 –18

40 8 (40 – 65) –25/5 –5 –40
45 12 (45 – 65) –20/5 –4 –48
50 9 (50 – 65) –15/5 –3 –27
55 4 (55 – 65) –10/5 –2 –8
60 7 (60 – 65) –5/5 –1 –7
65 15 (65 – 65) 0/5 0 0
70 5 (70 – 65) 5/5 1 5
75 10 (75 – 65) 10/5 2 20
80 7 (80 – 65) 15/5 3 21
85 5 (85 – 65) 20/5 4 20
90 3 (90 – 65) 25/5 5 15
95 2 (95 – 65) 30/5 6 12
N = 90  fdx = –55

 fdx -55 -275
xA i = 65 + × 5 = 65 + = 65 - 3.05 = 61.95
n 90 90
Mean for Grouped Data
C) Continuous Series
In continuous series variable are represented by class-interval. Each class intervals
has its own frequency. Midpoint (class-marks) of each class should be ascertained first.
Then the procedure of finding the arithmetic mean is the same as used in the discrete
series.

Notes 1. Exclusive Method
i) Direct Method
Illustration - 1
Calculate Arithmetic Mean from the following data.

Production in tones: 10-20 20-30 30-40 40-50 50-60 60-70 70-80
No. of factories 5 4 7 12 10 8 4
Solution:

 fx 2,330
x = = 46.6
n 50
ii) Step deviation Method
Illustration - 1
Calculate Arithmetic Mean from the following data.

Production in tones: 10-20 20-30 30-40 40-50 50-60 60-70 70-80
No. of factories 5 4 7 12 10 8 4
Solution:
x A
Production No. of Mid point (x) dx = c
(A = 45) fdx
LL  UL
in tones (x) factories (f) 2
i = 10
10-20 5 10 + 20/2 = 15 (15 – 45) = –30/10 = –3 (5 × –3) = –15

20-30 4 20 + 30/2 = 25 (25 – 45) = –20/10 = –2 (4 × –2) = –8
30-40 7 30 + 40/2 = 35 (35 – 45) = –10/10 = –1 (7 × –1) = –7
40-50 12 40 + 50/2 = 45(A) (45 – 45) = 0/10 = 0 (12 × 0) = 0

50-60 10 50 + 60/2 = 55 (55 – 45) = 10/10 = 1 (10 × 1) = 10 Notes

60-70 8 60 + 70/2 = 65 (65 – 45) = 20/10 = 2 (8 × 2) = 16
70-80 4 70 + 80/2 = 75 (75 – 45) = 30/10 = 3 (4 × 3) = 12
N = 50 fdx = 8

 fdx
xA i
n
8 80
= 45 + × 10 = 45 + = 45 + 1.6 = 46.6
50 50
2. Inclusive Method
i) Step Deviation Method
Illustration - 1
The following are the 270 soybean plant heights collected from a particular plot. Find the
arithmetic mean of the plants
Plant height 8-12 13-17 18-22 23-27 28-32 33-37 38-42 43-47 48-52
(Cms)
No. of plants 8 17 20 50 75 30 25 40 5
When the length of class is equal step deviation method is appropriate and the length of
the class unequal direct method is appropriate, in this problem the length of class is equal i.e.,
c = 5 whether inclusive or exclusive given continuous class converted in to mid point(x) for
calculating Arithmetic Mean
Solution:
x A
Plant height No. of Mid point (x) dx = c
A = 30 (f × dx) = fdx (Cms) (x)
LL  UL
plants (f) 2
i=5 dx
U|
|V
8-12 8 8 + 12/2 = 10 (10 – 30)/5 = –4 (8 × –4) = –32
13-17 17 13 + 17/2 = 15 (15 – 30)/5 = –3 (17 × –3) = –51
18-22 20 18 + 22/2 = 20 (20 – 30)/5 = –2 (20 × –2) = –40 ||
23-27 50 23 + 27/2 = 25 (25 – 30)/5 = –1 (50 × –1) = –50 W –173
28-32 75 28 + 32/2 = 30(A) (30 – 30)/5 = 0 (75 × 0) = 0 U|
33-37 30 33 + 37/2 = 35 (35 – 30)/5 = 1 (30 × 1) = 30 |V
38-42 25 38 + 42/2 = 40 (40 – 30)/5 = 2 (25 × 2) = 50 ||
43-47 40 43 + 47/2 = 45 (45 – 30)/5 = 3 (40 × 3) = 120 W
48-52 5 48 + 52/2 = 50 (50 – 30)/5 = 4 (5 × 4) = 20 +220
N = 270 fdx = (220 - 173) = 47

Notes 
 fdx  47  235
xA i = 30 +  5 = 30 + = 30 + 0.870 = 30.87 or 30.9
n  270  270
3. Arithmetic Mean for open-end classes
The lower limit of the first class interval and upper limit of the last class interval are
not know, it is called open-end classes.
Types of open-end classes
Open-end classed are of two types they are:

i) Less than open-end class
Given variable (x) must have upper class limit of the continuous series either in
ascending or in descending order. And given frequency must be in cumulative nature. Upper
class begins with the words below. Or upto or not exceeding or less than.
Procedure:
• Convert in to equal class interval: subtract the class length (CL) from the
upper limit (UL) will get the lower limit (LL) of the first class. Similarly add the
same class length to the lower limit of the last class will get the upper limit
of the last class. But always notice that the lower limit of the first class (i.e.
the lowest class) must not be negative or less than 0. (Hence, lower limit =
upper limit -class length) (In the above problem (Class length is 10 (30-20), the
lower limit (20-10 = 10)) and then the upper limit of the first class becomes
the lower limit of the next class… )
• Convert the cumulative frequencies: into frequencies of the respective
classes.
Illustration - 1
Calculate AM for the following data

Marks Below 20 30 40 50 60 70 80 90 100
No. of Students 10 18 25 32 43 61 67 85 100
Solution:
Marks (x) f Class f Mid (x) i = 10 dx f × dx = fdx

xA
UL + LL/2 = c
Below 20 10 10-20 10 15 –4 –40

“ 30 15 20-30 8 25 –3 –24
“ 40 25 30-40 7 35 –2 –14
“ 50 32 40-50 7 45 –1 –7
“ 60 43 50-60 11 55(A) 0 0
“ 70 61 60-70 18 65 +1 18
“ 80 67 70-80 6 75 +2 12

“ 90 85 80-90 18 85 +3 54 Notes
“ 100 100 90-100 15 95 +4 60
N = 100 fdx = 59

 fdx  59  590
xA i = 55 +  10 = 55 + = 55 + 5.9 = 60.9
n  100  100
ii) More than open-ended class

Given variable (x) must have lower class limit of the continuous series either in
ascending or in descending order. And given frequency must be in cumulative in nature.
Lower class begins with the words above. Or more than or over.
Procedure:
• Lower limit + Class length = upper limit (i.e. length of class 30-20 = 10. UL
= LL + CL in this problem the lower limit 20, 30 and so on... the lower limit
of the next must be the upper limit of the previous class …. the last class
lower limit + class length = upper limit i.e., 90 + 10 = 100)
• Convert the cumulative frequencies into frequencies of the respective classes.
Illustration - 1
Calculate AM for the following data:

Marks Above 20 30 40 50 60 70 80 90
No. of Students 100 95 87 62 43 25 13 2
Solution:
Marks (x) f Class f Mid (x) f = 10 f × dx = fdx

xA
UL + LL/2 dx = c
Above 20 100 20-30 5 25 –3 –15

“ 30 95 30-40 8 35 –2 –16
“ 40 87 40-50 25 45 –1 –25
“ 50 62 50-60 19 55(A) 0 0
“ 60 43 60-70 18 65 +1 18
“ 70 25 7-80 12 75 +2 24
“ 80 13 80-90 11 85 +3 33
“ 90 2 90-100 2 95 +4 8
N = 100 fdx = 27

 fdx  27  270
xA i = 55 +  10 = 55 + = 55 + 2.7 = 57.7
n  100  100

Notes 4. Simple Arithmetic Mean
The simple arithmetic mean it is assumed that all the items are of equal importance
for finding simple average total values are divided by number of items.
5. Weight Arithmetic Mean
Sometime, some observations got relatively more importance than other observation.
The weight for such observation should be given on the basis of their relative importance.
The value of each item is multiplied by its weight and the product are divided by number
of weights for finding average is called weight arithmetic mean.

 wx
Symbolically: xw 
w
Illustration - 1
Calculate simple and weighted average from the following data

Month January February March April May June
Price per ton ( in “000”) 42.5 51.25 50 52 44.25 54
No. of tones purchased 25 30 40 50 10 45
Solution:
Month Price per ton No. of tones WX

(` in ‘000’) (x) Purchased (w)
January 42.5 25 1,062.5
February 51.25 30 1,537.5
March 50 40 2,000
April 52 50 2,600
May 44.25 10 442.5
June 54 45 2,430
n=6 x = 294 w = 200 wx = 10027.5

Simple AM:

x 294
x = = 49
n 6
Weighted AM:

 wx 10,027.5
xw  = = 50.137
w 200
The correct average price paid is ` 50.30 and not ` 49 i.e., weight arithmetic mean
is correct than simple arithmetic mean.

6. Combined Arithmetic Mean Notes

Arithmetic mean and number of items of two or more related groups are known as
combined mean of the entire group. The combined average of two series can be calculated
by the given formula:
 
 n . x + n2 . x 2
x 12 = 1 1
n1 + n2
Where, n1 = No. of items of the first group, n2 = No. of items of the second group
  
x1 = A.M of the first group, x 2 = A.M of the second group, x12 = Combined AM
Illustration - 1
From the following data ascertain the combined mean of a factory consisting of 2
branches namely branch A and Branch B. In branch A the number of workers is 500,
and their average salary of ` 300. In branch B the number of workers is 1,000 and their
average salary is ` 250
Solution:

Let the no. of workers in branch A be n1 = 500, Average salary x = 300
1

Let the no. of worker in branch B be n2 = 1,000, Average salary x = 250
2
 
 n . x + n2 . x 2 500(300) + 1000(250) 1,50,000 + 2,50,000
x 12 = 1 1 = =
n1 + n2 500 + 1,000 1,500
4,00,000
= = 266.66
1,500
7. Corrected Arithmetic Mean
Correct  x
Correct x 
N
Correct  x  incorrect  x  wrong items  correct items
Illustration - 1
The mean of 20 values is 45. If one of these values is taken as 64 instead of 46

find the corrected mean.
Solution:
x = 45, N = 20, wrong items = 64, correct items = 46
Correct  x  incorrect  x  wrong items  correct items

= 45 x 20 (-64 + 46) = 900 - 18

Notes Correct  x = 882
882
Correct x = = 44.1
20
8. Missing frequency or values
Illustration - 1
If the average wage paid to 25 workers is 796, find the missing numbers
Wages 500 600 700 800 900 1,000 1,100
No. of workers 1 3 - - 6 2 1
Solution:
N = 25, AM = 796 Let, missing number of workers be X & Y
Wages ` (x) No. of workers (f) fx (x*f)

500 1 500
600 3 1,800
700 x 700x
800 y 800y
900 6 5,400
1,000 2 2,000
1,100 1 1,100
N = 25  fx = 10,800 + 700x + 880y
Step 1: 1 + 3 + x + y + 6 + 2 + 1 = 25
13 + x + y = 25 x + y = 25 - 13 x + y = 12 (Equation no. 1)
Step 2: X 
 fx , 796 = (10,800 + 700x + 800y) / 25
N
Cross multiplying 796*25 = 10,800 + 700x + 800y
19,900 - 10,800 = 700x + 800y
700x + 800y = 9100 (Equation no. 2)
Step 3: Equation 1 is multiplying with 700
x + y = 12…..*700, 700x +700y = 8,400 (Equation no. 3)
Step 4: Equation 3 is subtracted from equation 2
700x + 800y = 9,100 (Equation 2) –
700x + 700y = 8,400 (Equation 3)
100y = 700 y = 700/100, y=7
Step 5: Substitute the value of Y in equation no. 1
x + y = 12, x + 7 = 12, x = 12 - 7, x = 5
The missing frequencies are x = 5 and y = 7 respectively.
2.5 Median Notes

Median is defined as the value of that item which divides the series into two equal
halves, one half contains all values less than (or equal to) it and the other half containing
all values greater than (or equal to) it. It is also defined as the “central value of the variable.
It should be noted that the value of items should be arranged in order of their magnitude
or size to find out the median).
The median is that value of the variable which divides the group into two equal parts,
one part comprising all values greater and the other all values lesser than the median.
Median is a positional average. The term position refers to the place of a value in
a series the place of median in a series is such that an equal number of items lies on
either side, therefore it is also called a locative average.
Merits of Median
Following are the advantages of median:

1. It is rigidly defined.
2. It is easy to calculate and understand.
3. It is not affected by extreme values like the arithmetic mean.
4. It can be found by mere inspection.
5. It can be used for qualitative studies.
6. Even if the extreme values are unknown, median can be calculated if one know
the number of items.
7. It can be located graphically.
Demerits of Median
Following are the disadvantages of median:

1. In the case of individual observations, the values are to be arranged in order
of their size to locate median. Such an arrangement of data is tedious if the
number of items is large.
2. If the median is multiplied by the number of items, the total value of all the items
cannot be obtained as in the case of the arithmetic average.
3. It is not suitable for further algebraic or mathematical treatment.
4. It is more affected by fluctuations of sampling.
1. Individual Series
The following steps are involved in calculating median in individual series:

1) Arrange the values in the group either in ascending order or descending order.
2) Find out the value of the middle item by applying the following formula.
FG N  1IJ
M = size of H 2 K in item
Where, M = Median
N = Number of items

Determine the median from the following:

25, 15, 23, 40, 27, 25, 23, 25, 20
Solution:
The figures given must be arranged either in ascending order (or descending order)
of their magnitude.
Calculation of median:
Serial No. Value or Size

1 15
2 20
3 23
4 23
5 25
6 25
7 25
8 27
9 40
FG N  1IJ
Median = Size of H 2 K th item
10
= = 5th item, i.e. 25
2
Illustration - 2
The table below gives the marks obtained in advanced accountancy by the students
with Roll Nos. 1 to 10 at the final chartered accountant examination.
Roll No. Marks obtained
1 43
2 48
3 65
4 57
5 31
6 60
7 37
8 48
9 78
10 59
Calculate the median.

Solution: Notes
Serial No. Marks obtained

1 43
2 48
3 65
4 57
5 31
6 60
7 59
8 60
9 65
10 78
FG N  1IJ
Median = Size of H 2 K th item
10  1
= 5.5th item.
2
5.5 is between 5th item and 6th item.
48  57 105
i.e., = = 52.5 Median marks is 52.5
2 2
2. Continuous Series
The following steps are involved in calculating median in continuous series:

1) Find out the cumulative frequency
N
2) Find out the median item, i.e., th item.
2
3) Find out the group or class containing the median
4) Estimate the median applying the following formula.
n
 cf
Me = l+ 2 i
fm
where Me = Median
l = Lower limit of the median class
cf = Cumulative frequency of the class preceding the median
class
i = Size of class interval
fm = Middle one of frequency sequence.

Notes N
Median is the =
2
Illustration - 1
Calculate the median of the following distribution.

Length (in inches) No. of units
0 – 20 1
20 – 40 14
40 – 60 35
60 – 80 85
80 – 100 90
100 – 120 15
Solution:
Length (in inches) f Cf
0 – 20 1 1
20 – 40 14 15
40 – 60 35 50
60 – 80 85 135
80 – 100 90 225
100 – 120 15 240
n 240
M=  = 120th item. i.e., 60 – 80 group.
2 2
n
 cf 20
Me = l + 2  i = 60  85  70 = 60 + 16.47 = 76.47
fm
Illustration - 2
Calculate the median mark from the following frequency distribution.

Marks No. of students
0 – 10 5
0 – 20 13
0 – 30 20
0 – 40 32
0 – 50 60
0 – 60 80
0 – 70 90
Solution:

Calculation of median: Notes

Marks F CF
0 – 10 5 5
10 – 20 8 13
20 – 30 7 20
30 – 40 12 32
40 – 50 28 60
50 – 60 20 80
60 – 70 10 90
N 90
M=  = 45
2 2
n
 cf 50  40
Me = l + 2 i = 40 
fm 28
10
= 40   13
28
= 40 + 4.64 = 44.64
3. Calculate Median when mid values are given:
Illustration - 1
Mid value 115 125 135 145 155 165

Frequency 6 25 48 72 60 19
Solution:
Class (x) f cf
110-120 6 6
120-130 25 31
130-140 48 79 cf
140-150 72 f 151
150-160 60 211
160-170 19 230
N = 230
Step 1: Mid value convert in to exclusive class, find the difference between two mid
values and half of the difference should be deduct from the mid value to find out lower
limit of the class and the same difference add to the mid value to get upper limit of the
class e.g. (125 - 115) = 10/2 = 5, (115 - 5 = 110 lower limit and 115 + 5 = 120 upper
limit, i.e., 110 - 120………)
Notes Steps 2: Sample frequencies convert in to cumulative

Steps 3: Determine median class. Use N/2 th items
230/2 = 115 terms. l1 = 140, l2 = 150, cf = 79 f = 72
N 
  cf 
M  l1   2  l2  l1
Steps 4: Apply formula  f 
 
 115 - 79   36  360
= 140 +  150 - 140 = 140 +  72 10 = 140 + = 140 + 5 M = 145
 72    72
Illustration - 2
Mid value 35 45 55 65 75 85
Frequency 6 25 18 32 15 4
Solution:
Class (x) f cf
30-40 6 6
40-50 25 31
50-60 18 49 cf
60-70 32 f 81
70-80 15 96
80-90 4 100
N = 100
Mid value convert in to exclusive class, e.g., (35 - 45) = 10/2 = 5, (35 - 5 =
30 lower limit and 35 + 5 = 40 upper limit, i.e., 30 - 40………)
Determine median class. Use N/2 th items
100/2 = 50 terms. l1 = 60, l2 = 70, cf = 49 f = 32
Formula:
N 
  cf 
M  l1   2  l2  l1  50 - 49
= 60 + 

 f   70 - 60
 32 
 
 1  10
= 60 +  10 = 60 + = 60 + 0.3125, M = 60.312
 32  32

4. Calculate Median when open-end classes are given: Notes
Illustration - 1
Less than 10 20 30 40 50 60 70 80
Frequency: 4 16 40 76 96 112 120 125
Solution:
Steps 1: Need to ascertain lower limit of the continuous class (LL = UL - CL) Class
length (CL) = 20 - 10 = 10 i.e., (10 - 10 = 0…………)
Steps 2: Cumulative frequency convert in to sample frequency.
Steps 3: Determine median class. Use N/2 th items 125/2 = 62.5 terms.
Value (x) Class f cf

Less than 10 0-10 4 4
Less than 20 10-20 16 - 4 = 12 16
Less than 30 20-30 40 - 16 = 24 40
Less than 40 30-40 76 - 40 = 36 76
Less than 50 40-50 96 - 76 = 20 96
Less than 60 50-60 112 - 96 = 16 112
Less than 70 60-70 120 - 112 = 8 120
Less than 80 70-80 125 - 120 = 5 125
N = 125
N 
  cf 
M  l1   2  l2  l1  62.5 - 40 
= 30 + 
 f  36  40 - 30
 
 
 22.5  225
= 30 +  10 = 30 + = 30 + 6.25 = 36.25
 36  36
Illustration - 2
More than 10 20 30 40 50 60 70 80
Frequency: 115 103 88 68 43 23 13 3
Solution:
1. Need to ascertain upper limit of the continuous class (UL = LL + CL)
Class length (CL) = 20 - 10 = 10 i.e., (10 + 10 = 20…………)
2. Cumulative frequency convert in to sample frequency
3. Determine median class. Use N/2 th items 115/2 = 57.5 terms

Notes
Value (x) Class cf f
More than 10 10-20 115 - 103 = 12 12
More than 20 20-30 103 - 88 = 15 27
More than 30 30-40 88 - 68 = 20 47
More than 40 40-50 68 - 43 = 25 72
More than 50 50-60 43 - 23 = 20 92
More than 60 60-70 23 - 13 = 10 102
More than 70 70-80 13 - 3 = 10 112
More than 80 80-90 3 115
N = 115
N 
  cf 
M  l1   2  l2  l1  57.5 - 47 
= 40 + 
 f  25  50 - 40
 
 
 10.5  105
= 40 +  10 = 40 + = 40 + 4.2 = 44.2
 25  25
5. Ascertain Missing frequency when median is given:
Illustration - 1
Complete the following distribution, if its median is 260 & total frequency is 150.
Size 100-150 150-200 200-250 250-300 300-400 400-500 500-600
Frequency 12 - 40 50 - 5 2
Solution:
Size f cf
100-150 12 12
150-200 x 12+x
200-250 40 52+x
250-300 50 102+x
300-400 y 102+x+y
400-500 5 107+x+y
500-600 2 109+x+y
N = 150
Let missing frequency be x and y
N 150
= = 75,
2 2

Median is given 260 Notes

109 + x + y = 150,...........…Eq1
x + y = 150 - 109  x + y = 41
M = 260 is lies b/w 250-300, Median class is 250-300
N 
  cf 
M  l1   2  l2  l1
 f 
 
 75 - (52 + x) 
 260 = 250 +  50  300 - 250
 
 75 - 52 + x 
 260  250    50  10 = 23 - x  x = 23 - 10  x = 13
 50 
Substitute in Eq1, 109 + 13 + y = 150  y = 150 - 122  y = 28
Illustration - 2
An incomplete distribution is given below calculate missing frequency if median

height of a plant is 8.53 inches.
Height in inches 5.1-6 6.1-7 7.1-8 8.1-9 9.1-10 10.1-11 11.1-12
No of plants 3 8 27 - 17 11 9
Solution:
Height in No. of cf
Inches (CL) plants (f)
5.05 - 6.05 3 3
6.05 - 7.05 8 11
7.05 - 8.05 27 38
8.05 - 9.05 x 38+x
9.05 - 10.05 17 55+x
10.05 - 11.05 11 66+x
11.05 - 12.05 9 75+x
N = 75+x
Median value is given 8.53 inches so,
N 75 + x
Median class is 8.05 - 9.05, =
2 2
N 
  cf 
M  l1   2  l2  l1
 f 
 

Notes
 75 + x 
 2 - 38 
 8.53 = 8.05 -   9.05 - 8.05
 x 
 
 75 + x   75 + x 
 2 - 38   2 - 38 
 8.53 = 8.05 -  1  0.48 -  1
 x   x 
   
75 + x
 0.48(x) -  - 38  2(0.48x)- 75 + x = -(38)2
2
 0.96x - 75 + x = -76  0.96x - x = -76 + 75
-1
 -0.04x = -1  x=  x = 25
-0.04
Steps 1: given inclusive convert in to exclusive (6.1 - 6 = 0.1/2 = 0.05),
Lower limit 5.1 - 0.05 = 5.05 upper limit 6 + 0.05 = 6.05 i.e., (5.05 - 6.05 ……)
Step 2: let missing frequency be x, sample frequency convert in to cumulative
frequency.
2.6 Mode
The word “mode” is derived from the French word “1a mode” meaning fashion. So
it can be regarded as the most fashionable item in the series or the group.
Croxtan and Cowden regard mode as “the most typical of a series of values”. As
a result it can sum up the characteristics of a group more satisfactorily than the arithmetic
mean or median.
Mode is defined as the value of the variable which occurs most frequently in a
distribution. In other words it as the most frequent size of item in a series.
Merits of Mode
The following are the merits of mode:

1. The most important advantage of mode is that it is usually on actual value.
2. Mode can be easily located by inspection in the case of discrete series.
3. It is not affected by extreme values.
4. It can be determined even if extreme values are not given.
5. It is easy to understand. This average is used by people in their every day
speech.
Demerits of Mode
The following are the demerits of mode:

1. It is not based on all the observation of the data.

2. It is not suitable for further mathematical treatment. Notes

3. In a number of cases there will be more than one mode in the series.
4. If mode is multiplied by the number of items, the product will not be equal to
the total value of the items.
5. It will not truly represent the group if there are a small number of items of the
same size in a large group of items of different sizes.
Ungrouped Data
a) Individual Series
The mode of this series can be obtained by mere inspection. The number which
occurs most often is the mode.
Illustration - 1
Locate mode in the data 7, 12, 8, 5, 9, 6, 10, 9, 4, 9, 9

Solution:
On inspection, it is observed that the number 9 has maximum frequency i.e., repeated
maximum of 4 times than any other number. Therefore mode (Z) = 9
b) Discrete Series
The mode is calculated by applying grouping and analysis table.
i) Grouping Table: Consisting of six columns including frequency column, 1st
column is the frequency 2nd and 3rd column is the grouping two way
frequencies and 4th, 5th and 6th column is the grouping three way frequencies.
ii) Analysis table: consisting of 2 columns namely tally bar and frequency
Steps in Calculating Mode in Discrete Series
The following steps are involved in calculating mode in discrete series:
1. Group the frequencies by two’s.
2. Leave the frequency and group the other frequencies in two’s.
3. Group the frequencies in threes.
4. Leave the frequency of the first size and add the frequencies of other sizes in
three’s.
5. Leave the frequencies of the first two sizes and add the frequencies of the other
sizes in threes.
6. Prepare an analysis table to know the size occurring the maximum number of
times. Find out the size, which occurs the largest number of times. That
particular size is the mode.
c) Continuous Series
The following steps are involved in calculating mode in continuous series.

1. Find out the modal class. Modal class can be easily found out by inspection.
The group containing maximum frequency is the modal group. Where two or
more classes appear to be a modal class group, it can be decided by grouping
process and preparing an analyzed table as was discussed in question number
2.102.
2. The actual value of mode is calculated by applying the following formula.

Notes
fm  f1
Mo = l+ i
2 fm  f1  f 2
where Mo = Mode
l = lower limit
fm = Highest frequency
f1 = Preceding value of highest frequency
f2 = Succeeding value of highest frequency
Illustration - 1
Calculate the modal wages.

Daily wages in ` (x) : 20-25 25-30 30-35 35-40 40-45 45-50
No. of workers (f) : 1 3 8 12 7 5
Solution:
Here, the maximum frequency is 12, corresponding to the class interval (35 - 40)
which is the modal class. Therefore, l1 = 35 l2 = 40 f1 = 12 fm = 8 f2 = 7
x f
20-25 1
25-30 3
30-35 8 fm
35-40 12 f1
40-45 7 f2
45-50 5
fm  f1  12 - 8 
Mode = l + i = 35 +   40 - 35
2 fm  f1  f 2  2(12)-8-7 
 4   20 
= 35 +  5 = 35 +   = 35 + 2.22 = 37.22
 24-15   9 
Illustration - 2
Calculation of mode in inclusive method:

x 10-19 20-29 30-39 40-49 50-59 60-69 70-79 80-89
f 5 12 22 25 14 10 8 4
Solution:
x f
10-19 5
20-29 12
30-39 22
40-49 25 Notes
50-59 14
60-69 10
70-79 8
80-89 4
fm  f
1  25-22 
Mode = l + 2 fm  f  f  i = 39.5 +   49.5 - 39.5
1 2  2(25)-22-14 
 3   30 
= 39.5 +  10 = 39.5 +   = 39.5 + 2.143 Z = 41.64
 50-36   14 
d) Calculate Mode when Less than and more than classes are given
Illustration - 1
Less than 10 20 30 40 50 60 70 80
Frequency: 4 16 40 76 96 112 120 125
Solution:
Need to ascertain lower limit of the continuous class (LL = UL - CL) Class length
(CL) = 20 - 10 = 10 i.e., (10 - 10 = 0…………)
fm  f
1  36 - 24 
Z = l + 2 fm  f  f  i = 30 +   40-30
1 2  2(36) - 24 - 20 
 12   120 
= 30 +  10 = 30 +   = 30 + 4.285 Z = 34.285
 72 - 44   28 
Illustration - 2
More than: 10 20 30 40 50 60 70 80
Frequency: 115 103 88 68 43 23 13 3

Notes Solution:
Need to ascertain upper limit of the continuous class (UL = LL + CL) Class
length (CL) = 20 - 10 = 10 i.e., (10 + 10 = 20…………)
fm  f1  25 - 20 
Z= l+ i = 40 +   50-40
2 fm  f1  f 2  2(25) - 20 - 20 
 5   50 
= 40 +  10 = 40 +   = 40 + 5 Z = 45
 50 - 40   10 
e) Empirical Relationship between Mean, Median and Mode
When mode is ill defined, it is difficult to find the value of mode, a sort of empirical
relationship exist among the mean, median and mode in such a way that the median
lies between the mode and the mean. The mode departs (to the left i.e., positive skewed)
2/3 difference from the median and the mean departs (to the right i.e., negatively skewed)
1/3 difference from the median. Karl Pearson’s expressed this relationship as Z = 3M -
2 X (when it is positive skewness).
Illustration - 1
M is 28, AM is 29 find Mode
Solution:
Z = 3M - 2X
= 3(28) - 2(29) = 84 - 78 = 26  29>28>26
Illustration - 2
M = ? AM = 39 Z = 36.5
Solution:
Z = 3M - 2X

 36.5 = 3(M) - 2(39)  36.5 = 3M - 78 Notes

-114.5
 -3M = -78 - 36.5 M= M = 38.16
-3
f) Locating mode graphically
Illustration - 1
The histogram for the following the data and locate mode graphically.
Class-interval Frequency
0 - 50 6
50 - 100 8
100 - 150 10
150 - 200 3
200 - 250 4
Solution:
Class-interval Frequency
0 - 50 6
50 - 100 8
100 - 150 10
150 - 200 3
200 - 250 4
10 - 8 2 100
Verify: 100 + × 50 , 100 + × 50 , 100 + , Z = 111.1
2(10) - 8 - 3 20 - 11 9

Monthly profits of 100 shops are distributed as follows; Locate mode graphically.
Profit per Shop No. of

(in ‘000’ `) shops
0 - 50 12
50 - 100 18
100 - 150 27
150 - 200 20
200 - 250 17
250 - 300 6
Solution:
Profit per Shop No. of

(in ‘000’ `) shops
0 - 50 12
50 - 100 18
100 - 150 27
150 - 200 20
200 - 250 17
250 - 300 6
Z = 128
2.7 Measure of Dispersion

The measures of central tendencies indicate the general magnitude of the data and
locate only the center of a distribution of measures. They do not establish the degree
of variability or the spread out or scatter of the individual items and their deviation from
the means. The two distributions of statistical data may have common means, medians
and modes and total frequencies, but they may differ widely in one distribution the value
may be concentred at a place and in the other distribution they may be scatter widely
from the measures of central tendencies such scattered variation is called measures of
variation or dispersion. For example,

Distribution A 50 50 50 X 50 Notes
Distribution B 30 45 75 X 50
The two distributions have same mean i.e. 50. But we cannot say that the
performances of the two distributions are same. There is greater uniformity of performance
in the distribution A. Whereas there is more variability in the performance of the distribution
B. Hence, distribution B are widely scattered. It is clear that the measures of the central
tendency is alone not sufficient to describe the data.
Meaning of Dispersion
The terms dispersion is used in two Senses. First, it means that all the items in
the group are not of the same value. They differ from one another in size. There is no
uniformity in size. Second, dispersion is used to indicate the measure of differences of
the size of items in the group from their average thus, a measure of deviations of items
from there average is called “the measure of dispersion.
Objectives of Measures Dispersion
1. To determining the reliability of average.

2. To serve as a basis for control of the variability.
3. To compare two or more series with regard to their variability.
4. To facilitate use of other statistical measures.
The Properties of a Good Measure of Dispersion

The following are the Properties of a good measure of dispersion:
(1) It should be Simple to understand.
(2) It should be easy to compute.
(3) It should be rigidly defined.
(4) It should be based on each and every item of the distribution.
(5) It should be amenable to further algebranic treatment.
(6) It should have sampling stability.
(7) It should not be unduly Affected by extreme items.
Absolute and Relative Measures of Variation
Absolute measures: The dispersion results are expressed in terms of the amount
of variation i.e., in original units are called absolute measures, for example range, mean
deviation, standard deviation etc.
Relative measures: The dispersion results are expressed in terms of the degree
of variation i.e., ratios or percentages are called relative measures, for example the
coefficient of range, the coefficient mean deviation, the co-efficient of variation etc.
2.8 Types/Methods of Dispersion

1. Range (R)
2. Quartile deviation (QD)

Notes 3. Mean deviation (MD)

4. Standard Deviation (SD)
1. Range (R)
It is a measure of dispersion which gives the difference between the highest and
the lowest value in the series. The difference between the two extreme values is called
the range. Suppose the weight of 50 B.Com students are given. Suppose the minimum
weight is 95 pounds and maximum 135 pounds. The weights of the students are distributed
between the two limits of 95 and 135 pounds. The range is 40 pounds (i.e. 95 – 45).
In any statistical series, the difference between the largest and the smallest values
is called as the range, Thus Range (R = L - S)
2. Quartile deviation (QD)
Quartile deviation gives the average amount by which two quartiles differ from the
median. In the asymmetrical distribution. The two quartiles (Q1 and Q3) are equidistant
from median ie,. Median – Q1 = Q3 – Median and as such the difference can be taken
as a measure of dispersion.
It is based on the upper quartile (Q3) and the lower quartile (Q1). The difference
between third quartile and first quartile (Q3 - Q1) is called the inter quartile range. The
difference third quartile and first quartile (Q3 - Q1) divided by 2 is called semi-inter-quartile
range or the quartile deviation.
Q  Q
Quartile Deviation  3 1 ............. absolute measure.
2
3. Mean deviation (MD)

Mean deviation is the average amount of variations of the items in a distribution from
either the mean or the median or the mode, ignoring the signs of these deviations. It is
concerned with the extent to which the values are dispersed about the mean or the median
or the mode. In aggregating the deviation ignoring the negative sign.
4. Standard Deviation (SD)
Standard deviation is defined as the Square root of the mean of the Squares of
deviations from the mean.
The concept of standard deviation was introduced by Karl Pearson’s in 1893. It is
the most important and widely used measures of studying dispersion. It overcomes the
defects from the earlier methods.
2.9 Range
It is a measure of dispersion Which gives the difference between the highest and
the lowest value in the series. The difference between the two extreme values is called
the range. Suppose the weight of 50 B.Com students are given. Suppose the minimum
weight is 95 pounds and maximum 135 pounds. The weights of the students are distributed
between the two limits of 95 and 135 pounds. The range is 40 pounds (i.e. 95 – 45).
In any statistical series, the difference between the largest and the smallest values
is called as the range, Thus Range (R = L - S)

Where, L is the largest value and S is the smallest value in the given data. Notes
Co-efficient of Range: The relative measure of the range. It is used in the comparative
L S
study of the dispersion Co-efficient of Range =
L S
Merits of Range
The merits of mean are as follows:

1) It is simplest to understand and the easiest to compute.
2) It takes the minimums time to calculate the value of range.
3) It is a good measure for comparison.
Limitations of Range
The limitations of range are as follows:

(1) It is not based on each and every item of the distribution.
(2) It is subject to fluctuations of considerable magnitude from sample to sample.
(3) In certain cases range does not tell any thing about the character distribution
within the two extreme observations. Note the following examples:
X: 1 2 3 4 50
Y: 1 29 39 49 50
Z: 1 47 48 49 50
In all the above cases range is same i.e., 49. But it does not mean that the
distribution are alike.
(4) Range cannot be calculated in case of open end distribution.
Uses of range as a method of dispersion
The uses of range is observed on the following situations:

1. It is used in meteorology department in determining the difference between the
maximum and minimum temperature. It is useful for general public.
2. Range is useful in studying the variation in the prices of shares and stock.
3. It is also useful for studying the range of fluctuation in the price of gold, silver
and jewellery etc.
4. Range is useful in determining and maintaining the quality of the product.
5. In studying quality control.
6. In knowing fluctuations in the share prices.
7. In weather forecasting.
8. In our day–to–day living as for example the minimum and maximum temperature
the minimum and maximum salary etc.
Illustration - 1
The largest of 100 measurements is 12 kgs. If the range is 2 kgs. Find the smallest
measurement.

Notes Solution:
R=L-S Here, R = 2, L = 12, 2 = 12 - S, S = 12 - 2 S = 10 kgs
Illustration - 2
The following are the wages of 8 workers of a factory find the range of variations and
also compute it’s co-efficient.
Wages (Rs.) 1,400 1,450 1,520 1,380 1,485 1,495 1,575
Solution:
The largest value in the given distribution is 1575 and the smallest value is 1380
R = L - S R = 1,575 - 1,380 R = 195
L S 1,575  1,380 195

Co-efficient of Range =   = 0.0660
L S 1,575  1,380 2,955
Illustration - 3
Compute the range and it’s co-efficient of range for the following distribution.
Variable: 30 45 67 24 56 98 25 86 45 34 65
72
Frequency: 4 6 9 8 7 13 18 9 25 23 45
9
Solution:
For finding range, the frequencies are not taken into account
R = L - S, L = 98, S = 24, R = L - S, R = 98 - 24 R = 74
L S 98  24 74
L S 98  24 122
Illustration - 4
Compute the range and it’s co-efficient of range of the series, and state which one is
more dispersed and more uniform
Series Variables
I 20 22 24 29 27 26 29 21 25
II 61 64 68 66 67 63 69 62 60
III 91 92 93 94 95 96 97 98 99
Solution:
Series I Series II Series III
R = L - S, L = 29, S = 20 R = L - S, L = 69, S = 60, R = L-S, L = 99, S = 91,

R = L - S, R = 29-20, R = 9 R = L - S, R = 69 - 60 R = 9 R = 99 - 91, R = 8
L S L S L S
Co-efficient of Range = Co-efficient of Range = Co-efficient of R =
L S L S L S

29  20 9 9 99  91 8 Notes
  = 0.1836  = 0.069   = 0.042
29  20 49 129 99  91 190
On comparative study of 3 series in terms of variability Series III is more uniform

and less dispersed and Series I has more dispersed and less uniform.
Illustration - 5
Calculate range and its coefficient from the following date:
53, 46, 18, 16, 75, 84, 28
Solution:
Range = Largest – Smallest = 84 – 16 = 68
LS 84  16 68
Coefficient of range =    0.68
LS 84  16 100
Illustration - 6
Compute the range and the co-efficient of range from the following distribution
C.I : 120 - 130 130-140 140-150 150 - 160 160-170
F : 2 9 16 12 5
Solution:
In finding the range the frequencies are never taken into account. The upper limit of
the highest class and the lower limit of the smallest class are only taken into account.
Range = L - S = 170 - 120 = 50
L  S 170  120 50
Co-efficient of Range =  = = 0.1724
L  S 170  120 290
Illustration - 7
From the following distribution find the range and the co-efficient of range
X: 6 12 18 24 30 36 42
y: 20 130 80 60 210 1500 600
Solution:
In finding the range the frequencies are never taken into account.
Range = L - S = 42 - 6 = 36
L  S 42  6 36
L  S 42  6 48
2.10 Average Deviation / Mean deviation

The mean deviation is the arithmetic average (mean, median or mode) taking all
deviations as positive. Thus mean deviation is obtained by dividing the sum of the deviations
from an average (neglecting signs) by the number of items. It is also called as the first
moment of dispersion.

Notes Mean deviation is the average amount of variations of the items in a distribution from
Computation of Mean Deviation
a) Mean deviation from the Arithmetic mean.

b) Mean deviation from the Median.
c) Mean deviation from the Mode.
a) Calculation of Mean deviation from the Arithmetic mean
The following steps are involved in calculating mean deviation in individual series:
(1) Find out an average i.e., either mean or median.
(2) Find out the deviation of each value or size of item from the average selected.
Signs should not be taken into account. The symbol for deviation ignoring sign
is | d |, pronounced as module D.
(3) Add up deviations and divide the sum of the deviations by the number of items.
The formula is as follows:
MD =
|d|
N
where, MD = Mean deviation
 | d | = Sum of the deviations from the average ignoring the Signs
N = Number of items
The following steps are involved in calculating mean deviation under discrete Series:
(1) Find out on average (i.e., mean or median).
(2) Find out the deviation of each size from the average selected. All deviations
must be regarded as positive.
(3) Multiply the deviation of each size by its frequency.
(4) Add up the Products (f|d|) and divide the sum of the products by total frequency.
The formula is as follows:
M.D =
 f|d|
N
Merits of Mean Deviation
The merits of mean deviation are as follows:

(1) It is Simple to understand and easy to calculate.
(2) It is based on each and every item of the data.
(3) It is less affected by the value of extreme items.
(4) Since deviations are taken from a central value, Comparision about formation
of different distribution can easily be made.

Demerits of Mean Deviation Notes

The limitation of mean deviation are as follows:
(1) The greatest demerit of mean deviation is that it ignors signs while taking
deviations of the items. This is mathamatically incorrect.
(2) The method may not give us very accurate result. This is because deviations
can be taken from any measure of central tendency viz, Mean, Median and
mode.
(3) It is not capable of further algebraic tretament.
(4) It is not popularly used measure of dispersion.
Co-efficient of Mean Deviation
Co-efficient of mean deviation is calculated by dividing mean deviation by the average

used. The formula is as follows:
M.D M.D
Co-efficient of MD = or
Mean Median
i) MD in Individual series
Example 1:
Calculate mean deviation and it coefficient for the following data
Value (x) 125 128 132 135 140 148 155 157 159 161
Solution:
ii) MD in Discrete Series
Example 2:
Calculate mean deviation and it co-efficient for the following data

Notes X 35 40 45 50 55 60 65 70 75 80 85 90 95
f 3 8 12 9 4 7 15 5 10 7 5 3 2
Solution:
iii) MD in Continuous Serious
Example 3:
Calculate mean deviation and its co-efficient for the following data:
X f
10-20 5
20-30 4
30-40 7
40-50 12
50-60 10
60-70 8
70-80 4
Solution:

Notes
b) Calculation of Mean deviation from the Median

Formula:
Individual Series Discrete and Continuous Series
MD 
 dx MD 
 fdx
n n
MD MD
Co-efficient of MD = Co-efficient of MD =
M M
(i) Individual Series
Example 4:
Compute mean deviation and its co-efficient from Median
Value(x) 20 25 30 38 42 55 66 67 70
Solution:

Notes ii) Discrete Series
Example 5:
Compute mean deviation and its co-efficient from median
Value(x) : 125 126 130 132 134 138 140 141
f : 8 4 3 10 7 9 4 2
Solution:
iii) Continuous Series
Example 6:
Calculate mean deviation and its coefficient form median
x 0-10 10-20 20-30 30-40 40-50
f 8 30 40 12 10
Solution:

Notes
c) Mean deviation from Mode

Example 7:
Calculate mean deviation and its coefficient form mode.
x f
120-140 5
140-160 12
160-180 18
180-200 22
200-220 16
220-240 10
240-260 8
260-280 4
Solution:
x f MP x-z = dx fdx
120-140 5 130 58 290

140-160 12 150 38 456
160-180 18 170 18 324
180-200 22 190 2 44
200-220 16 210 22 352
220-240 10 230 42 420
240-260 8 250 62 496
260-280 4 270 82 328
N = 95 fdx = 2,710

Notes Z = l1+ {f1 - fo / 2f1 - fo - f2} l2 - l1

= 180 + (22 - 18) / {2(22) - 18 - 16}20
= 180 + 4 / (44 - 34)20
= 180 + 80/10
= 180 + 8
Z = 188
Illustration - 1
Calculate the mean deviation from the airthmatic mean of the following data relating
to the monthly earnings for a year
Months Jan Feb Mar Apr May June
Earnings 1198 1200 1200 1202 1202 1204
Months July Aug Sept Oct Nov Dec
Earnings 1204 1206 1206 1208 1208 1210
Solution:
Calculation of M.D
Month Earnings | d | = 1,204

Jan 1198 6
Feb 1200 4
March 1200 4
Apr 1202 2
May 1202 2
June 1204 0
July 1204 0
Aug 1206 2
Sept 1206 2
Oct 1208 4
Nov 1228 4
Dec 1210 6
x = 14,448 |d| = 36
 x  14448  1204
x =
N 12
MD =
 |d|  36  3
12 12
Illustration - 2
Calculate (a) Median co-efficient of dispresion and (b) Mean Co-efficient of dispersion
from the following data:

Size of item: 4 6 8 10 12 14 16 Notes

Frequency: 2 4 5 3 2 1 4
Solution:
Calculation of Median Co-efficient of Dispersion
Size of item f Cf |d| = 8 f |d|

4 2 2 4 8
6 4 6 2 8
8 5 11 0 0
10 3 14 2 6
12 2 16 4 8
14 1 17 6 6
16 4 21 8 32
f|d| = 68
n 21
M=  = 10.5th item = size of 10.5th item is 8
2 2
MD =
 f|d| =
68
 3.2
N 21
M.D 3.2
Median co-efficient of Dispersion = = = 0.4
Median 8
Calculation of the Mean co-efficient of dispersion
Size of item (x) f fx | d | = 9.7 f|d|
4 2 8 5.7 11.4
6 4 24 3.7 4.8
8 5 40 1.7 8.5
10 3 30 0.3 0.9
12 2 24 2.3 4.6
14 1 14 4.3 4.3
16 4 64 6.3 25.2
N = 21  fx = 204 f | d | = 59.7
 fx 
204
x  N 21
= 9.7
MD =
 f|d|  59.7  2.84
N 21
M.D 2.84
Mean co-efficient of dispersion = =  0.29
Mean 9.7

From the following calculate mean deviation from median:
Marks No. of students
10 - 14 12
15 - 19 29
20 - 24 59
25 - 29 75
30 - 34 46
35 - 39 19
Solution:
Since there is a an inclusive class interval distribution, we shall convert it into
exclusive class interval series.
Class frequency cumulative midvalue d = X-Me |d| f|d|

interval (f) (f) frequency X
9.5 - 14.5 12 12 12 - 14 14 168
14.5 - 19.5 29 41 17 -9 9 261
19.5 - 24.5 59 100 22 -4 4 236
24.5 - 29.5 75 175 27 1 1 75
29.5 - 34.5 46 221 32 6 6 276
34.5 - 39.5 19 240 37 11 11 209
 f|d|=1225
n th
 cf n
Median 2 Median is the size of   items
 l  x i 2
fm
th
120  100  240 
= 24.5  5 =    120 th items
75  2 
20  5
= 24.5  Here, l = lower units = 24.5
75
100
= 24.5  cf = cumulative frequency = 100
75
= 24.5 + 1.33 fm = frequency value = 75
= 25.83 i = size of class interval = 5
= 26 Median = ?
Median = 26

f | d | 1225 Notes
Mean deviation = =  510
.
N 240
Illustration - 4
Calculate mean deviation and its co-efficient value for the following series:
Marks obtained No. of students

10 - 12 5
12 - 14 8
14 - 16 12
16 - 18 20
18 - 20 7
20 - 22 10
22 - 24 11
24 - 26 15
26 - 28 10
Solution:
C.I M.V(x) f fx d = x -x |d| f|d|

10-12 11 5 55 -8.6 8.6 43
12-14 13 8 104 -6.6 6.6 52.8
14-16 15 12 180 -4.6 4.6 55.2
16-18 17 20 340 -2.6 2.6 52
18-20 19 7 133 -0.6 0.6 4.2
20-22 21 10 210 1.4 1.4 14
22-24 23 11 253 3.4 3.4 37.4
24-26 25 15 375 5.4 5.4 81
26=28 27 10 270 7.4 7.4 74
N = 98  fx = 1,920  f|d|= 413.6
 fx 1920
x = = = 19.6
N 98
 f| d | 413.6
MD = = = 4.22
N 98
M.D 4.22
 Co-efficient of MD = =
19 .6
= 0.215
x
Illustration - 5
Calculate the value of Co-efficient of mean deviation (from median) of the following
data.

Notes Marks No. of Students

10 - 20 2
20 - 30 6
30 - 40 12
40 - 50 18
50 - 60 25
60 - 70 20
70 - 80 10
80 - 90 7
Solution:
Marks No. of Students Cf midpoint (x) |d|=|X-Me| f|d|
10 - 20 2 2 15 40 80
20 - 30 6 8 25 30 180
30 - 40 12 20 35 20 240
40 - 50 18 38 45 10 180
50 - 60 25 63 55 0 0
60 - 70 20 83 65 10 200
70 - 80 10 93 75 20 200
80 - 90 7 100 85 30 210
N = 100 S f|d|= 1,290
To find Median
th th
n  100 
      50 th item
2  2 
n
 cf
Median  l  2 x i
fm
Where, l = Lower limit of median class
cf = Cumulative frequency of pre-median class
fm = Frequency of median class
 50  38  12
 50    10   50  10
 25  25
120
 50   50  4.8  54 .8
25
f | X  Me| f|d|
Median deviation = =
N N
1290
=  12.9
100

Mean Deviation Notes

Co-efficient of mean deviation (from median) =
Median
12.9
= = 0.235
54.8
2.11 Standard Deviation (SD or )

Standard deviation is defined as the Square root of the mean of the Squares of
deviations from the mean.
The concept of standard deviation was introduced by Karl Pearson’s in 1893. It is
the most important and widely used measures of studying dispersion. It overcomes the
defects from the earlier methods.
Standard deviation is “the square root of the arithmetic mean of the square deviations
of various values from their arithmetic mean. It is denoted by s.d. or  ” (Sigma)
d 2
symbolically  =
n
Standard deviation is the absolute measures of dispersion of a distribution. The

greater standard deviation indicates more variations and less uniformity. The smaller
standard deviation indicates less variations and more consistency of a series.
Mathematical Properties of Standard Deviation
The important properties of SD are:

• Co-efficient of Variation (CV)
• Variance
• Combined Standard Deviation
Co-efficient of Variation
Co-efficient of variation is the relative measure of dispersion of a distribution. To

compare the variations of two different series, relative measures of standard deviation must
be calculated. This is known as co-efficient of variation or the co-efficient of s. d. Thus
it is defined as the ratio s. d. to its mean Symbolically
Standard deviation
CV =  100
Mean
The series for which the co-efficient of variation (CV) is greater is said to be called
more variation and less uniformity. On the other hand the series for which co-efficient of
variation (CV) is less is said to be called less variable and more stable or consistency.
Variance
variance is the square of the standard deviation. Hence, variance is  2 or

  Variance

Notes Variance is defined as the mean of the Squares of deviation from the mean. It is
also called mean Square deviation. In order to calculate variance, we must first find out
the mean of the series. The deviation of each size from mean is found out. The deviations
are Squared and added up. The Sum of the Squares of deviations must be divided by
the total number of items. The result is the variance.
Variance =
 d2
N
Combined Standard Deviation
The combined standard deviation can be calculated by following the same method
of calculating the combined mean of two or more than two groups. It may be denoted
by  12 formula for combined standard deviation of two groups is,
N1 12  N 2 22  N1d12  N 2d12

 12 
N1  N 2
   
Where, d 2  x  x d22  x 2  x12
1 1 12
Merits of Standard Deviation
The advantages of Standard deviation are as follows:

(1) Standard deviation is rigidly defined and its value is always a definite figure.
(2) It takes into account every value in the series. Thus it is based on all the
observations of the data.
(3) It is suitable for mathamatical treatment.
(4) It is less affected by flactuations of Sampling.
Demerits of Standard Deviation
The following are the demerits of the Standard deviation:

(1) As compared to other measures it is difficult to compute.
(2) It gives more weight to values Which differ greatly from the mean (ie, extreme
values) and less weight to values which are nearer to the mean. Suppose the
mean of the series is 20. Suppose 40 and 19 are 2 values in the series. The
deviation of these values from the mean are 20 and –1. The Squares of the
deviations are 400 and 1. Thus the standard deviation gives, more weight to
extreme values. This is the reason why it is not much useful in most economic
studies.
Relation between Standard deviation and other Measure of dispersion
There is exists a relationship between the standard deviation and quartile deviation;
and between standard deviation and mean deviation. Among this quartile deviation is the
smallest and the standard deviation is the largest one. The mean deviation lies between
standard deviation and quartile deviation.

3 5 Notes
Symbolically  = QD and  = MD
2 4
Differences between Mean deviation and Standard deviation
The differences between mean deviation and Standard deviation are as follows:
(1) In Calculating Mean deviation, Signs are ignored Whereas in Calculating
Standard deviation Signs are taken into account.
(2) Mean deviation can be found out either from mean or median, Whereas Standard
deviation is always calculated from the mean because the sum of the Squares
of the deviation of items from arithmetic mean is the least.
Formula for calculating Standard Deviation and its Co-efficient
Individual series Discrete and continuous series
 
 ( x  x )2  f ( x  x )2
Actual Mean Method   
N N
 d2  fd2
Or =  
N N
Assumed Mean
 d2  F  d I
2 2
 fd2   fd 
a) Short cut method  =
N GH N JK  
N

 N 

2
 d 2   d  
b) Step deviation method  
N
  C
 N 
2
 fd 2   fd 
 
N
  C
 N 
Actual Mean Method

a) First Calculate arithmetic mean i.e., ( x ).

 
b) Calculate deviation from the arithm\etic mean i.e.,  x  x  dx  .
 
c) Square the deviation in order to remove the sign of deviation i.e.,

2

  2
 x  x   dx .
 

Notes d) Multiply dx 2 with the respect frequency the result will be fdx 2 (only in discrete
and continuous series).
e) Total the dx 2 column in case of individual series and fdx 2 in case of discrete
and continuous series.
f) Apply formula to get standard deviation.
Assumed Mean Method
x  A 
a) Calculate deviation from the assumed mean i.e.,   dx  .
 c 
b) Square the deviation in order to remove the sign of deviation i.e., dx 2 .
c) Total the dx 2 column in case of individual series and fdx^2 in case of discrete
and continuous series.
d) Apply formula to get standard deviation.
i) Individual Series
Example 1:
X : 120 125 130 135 140 145 150 155 160 165
Solution:
Assumed Mean Method

Actual Mean Method Notes
ii) Discrete Series
Example 2:
Calculate SD and variance from the following data:
Wages : 50 60 70 80 90 100 110 120
No. of workers : 8 5 9 4 6 7 3 2
Solution:

Notes a) Calculation of SD
b) Calculation of Variance
iii) Continuous Series
Example 3:
Find standard deviation from the following data:
Wages 0 - 10 10 - 20 20 - 30 30 - 40 40 - 50 50 - 60 60 - 70 70 - 80
No. 5 9 8 12 10 4 3 2
Solution:

Notes
Illustration - 1
Calculate the mean and Standard deviation of the marks of 10 Students in Statistics.
Student: 1 2 3 4 5 6 7 8 9 10
Marks in Statistics: 84 51 91 60 68 62 86 58 53 47
Solution:
Calculation of Standard deviation
Student Marks in Statistics d = 66 d2
1 84 +18 324
2 51 –15 225
3 91 +25 625
4 60 –6 36
5 68 +2 4
6 62 –4 16
7 86 +20 400
8 58 –8 64
9 53 –13 169
10 47 –19 361
x = 660 d = 0 d2 = 2,224
 x  660  66
x =
N 10
 =
 d2 2224
=
 222.4 = 14.91 Marks
N 10
 14.19
Co-efficient of Variation =  100 =  100 = 22.59%
x 66
Illustration - 2
Calculate the Standard deviation and the Co-efficient of variation from the following
table
Age No. of members

20 – 30 3

Notes 30 – 40 61
40 – 50 132
50 – 60 153
60 – 70 140
70 – 80 51
80 – 90 2
Solution:
Calculation of Standard deviation and Co-efficient of Variation
Age in years M.V f d = 55 fd d2 fd2
20 – 30 25 3 –30 –90 900 2,700

30 – 40 35 61 –20 –1,220 400 24,400
40 – 50 45 132 –10 –1,320 100 13,200
50 – 60 55 153 0 0 0 0
60 – 70 65 140 +10 +1,400 100 14,000
70 – 80 75 51 +20 +1,020 400 20,400
80 – 90 85 2 +30 +60 900 1,800
N = 542 fd = –150 fd2 = 76,500
 fd FG 150 IJ
x = a
N
= 55 + H 542 K = 55 + (– 0.28) = 54.72 years
 fd2  F  fd I FG IJ
2
 =
N GH N JK =
76500
542

150
542H K
= .  (0.28)2
14114 = 140.356 = 11.85
 11.85
Cv =  100 =  100  21.65%
x 54.72
Illustration - 3
Following are the runs scored by the two batsmen named NEKO and DECO in ten
innings. Find who is better scorer and who is more consistent.
NEKO: 101 22 0 36 82 45 7 13 65 14
DECO: 97 12 40 96 13 8 85 8 56 16
Computation of Standard Deviation.
Solution:

NECO DECO Notes

X d = (X - X ) d2 X d = (X - X ) d2
0 -38.5 1482.25 8 -35.1 1232.01
7 -31.5 992.25 8 -35.1 1232.01
13 -25.5 650.25 12 -31.1 967.21
14 -24.5 600.25 13 -30.1 906.01
22 -16.5 272.25 16 -27.1 734.41
36 -2.5 6.25 40 -3.1 9.61
45 +6.5 42.25 56 +12.9 166.41
65 +26.5 702.25 85 41.9 1755.61
82 +43.5 1892.25 96 +52.9 2798.41
101 +62.5 3906.25 97 97 +53.9 2905.21
x=385 d = 0    d2 = 10546.50      x = 431 d = 0 d2 = 12706.9

 X 385
NECO X=  = 38.5
n 10
 d2 10546.50
s =   1054.65 =32.475
n 10
 32.475
C.V =  100   100 = 84.35 %
X 38.5
DECO
 X 431
x =  = 43.1
n 10
d2 12706 .90

s =   1270 .69 = 35.647
n 10
 35.647
C.V. = x 100  x 100 = 82.71%
x 43.1
DECO is a better run score and more consistent player than NEKO (because
his average is more and variation is less)
Illustration - 4
Following are the marks obtained by two students A and B in 10 tests of 100 marks
each.
Tests: 1 2 3 4 5 6 7 8 9 10
A 44 80 76 48 52 72 72 51 60 54
B 48 75 54 60 63 69 72 51 57 66
Find out who is better in studies and if coefficient is the criteria for awarding a prize
who should get the price?

Notes Solution:
Calculation of co-efficient of variation for student A
X d = x - A d2
where, A = 60
44 -16 256
80 20 400
76 16 256
48 -12 144
52 -8 64
72 12 144
72 12 144
51 -9 81
60 0 0
54 -6 36
2
 x = 609 d = 9 d = 1525
X 609
X = = = 60.9
N 10
2 2
d2  d  1525  9 
 =    =    = 152 .5  0.81
n  n  10  10 
= 151 .69 = 12.32

Co-efficient of variation:
 12.32
= x 100 = x 100 = 20.23%
X 60.9
Calculation of co-efficient of variation B
X d = x - A d2
where, A = 60
48 -12 144
75 15 225
54 -6 36
60 0 0
63 3 9
69 9 81
72 12 144
51 -9 81
57 -3 9
66 6 36
2
 X = 615  d = 15  d = 765

x 615 Notes
X = = = 61.5 marks
N 10
2
d2  d 
 =   
n  n 
2
765  15 
=    = 76.5  2.25 = 74.25 = 8.617 marks
10  10 
 8.617
Co-efficient of variation = x 100 = x 100 = 14.01 %
X 61 .5
Here, co-efficient of variation is less for student ‘B’. So, ‘B’ is more consistent than
‘A’ and if prizs is based on consistency criteria, ‘B’ should get the prize.
Illustration - 5
Calculate standard deviation and co-efficient of variation.

X: 10-30 30-50 50-70 70-90 90-110 110-130 130-150
Y : 14 59 101 61 28 17 4
Solution:
XA
Class interval X f d d2 fd fd2
20
10 - 30 20 14 -3 9 - 42 126
30 - 50 40 59 -2 4 - 118 236
50 - 70 60 101 -1 1 - 101 101
70 - 90 80 61 0 0 0 0
90 - 110 100 28 1 1 28 28
110 - 130 120 17 2 4 34 68
130 - 150 140 4 3 9 12 36
 x = 560 n = 284  d = 0  d2 = 28  fd = -187  fd2 = 595
fd
x = A  n i
187 3740
= 80 + x 20 = 80 - = 80 - 13.17 = 66.83
284 284
2 2
fd2  fd 595   187 
Standard deviation (  ) =    c    x 20
n  n  284  284 
= 2.1  (0.658)2 x 20 = 2.1  0.43 x 20
= 1.67  20 = 1.292 x 20 = 25.85

Notes Co-efficient of variation,

 25.85
CV =  100 = x 100 = 38.68 %
x 66.83
Illustration - 6
The following table gives the age distribution of boys and girls in a school. Find which
of the two groups is more variable in age:
Age: 10 11 12 13 14 15
No. of Boys: 11 14 14 10 8 5
No. of Girls: 13 15 12 9 5 3
Solution:
Age No. of No. of d d2 Boys Girls

Boys (f) Girls(f) fd fd2 fd fd2
10 11 13 -2 4 -22 44 -26 52
11 14 15 -1 1 -14 14 -15 15
12 14 12 0 0 0 0 0 0
13 10 9 1 1 10 10 9 9
14 8 5 2 4 16 32 10 20
15 5 3 3 9 15 45 9 27
62 57  fd = 5  fd2 = 145  fd = -13  fd2 = 123

Let, Assumed Mean (A) = 12
fd
X = A +
n
5
Boys = 12 + = 12 + 0.08 = 12.08
62
13
Girls = 12 + = 12 - 0.23 = 11.77
57
2
fd2  fd 
SD (  ) =   
N  N 
2
145  5 
Boys =   = 2.339  0.0065  2.3326 = 1.527
62  62 
2
123   13 
Girls =    2.158  0.052  2.106 = 1.451
57  57 

CV = x 100
X
1.52
Boys = x 100 = 12.58%
12.08

1.45 Notes
Girls = x 100 = 12.32%
11.77
Boys are more variable in age since their CV is higher.
Illustration - 7
The following information is related to the marks scored in a test by girls section
and boys section in a school. From this, you are required to find out:
i) Which section scores more marks in an average?
ii) Which section is more consistent in scoring?
Marks: 0-10 10-20 20-30 30-40 40-50
No. of students
Boys section: 9 13 20 10 8
Girls section: 5 12 24 12 7
Solution:
 X  25 
Marks X   Boys (X) Girls (Y)
 10 
Mid value d d2 f fd fd’2 f fd’ fd2
0-10 5 -2 4 9 -18 36 5 -10 20

10-20 15 -1 1 13 -13 13 12 -12 12
20-30 25 0 0 20 0 0 24 0 0
30-40 35 1 1 10 10 10 12 12 12
40-50 45 2 4 8 16 32 7 14 28
2 2 2
 d=0  d =10 N=60  fd=-5  fd =91 n=60  fd’=4 fd =72
Calculation of Mean:
fd' 5
XB = A + x i = 25 + x 10 = 25 – 0.83 = 24.17
n 60
fd' 4
Ya = A + n
x i = 25 +
60
x 10 = 25 + 0.67 = 25.67
 Standard deviation for Boys = B 

2 2
fd'2  fd'  91   5 
B =   x i =   x 10
N  N  60  60 
= 1.52  0.0069 x 10 = 1.23 x 10 = 12.3
B 12 .3
CV =  x 100 = x 100 = 50.89%
B 24 .17

Notes Standard deviation for Girls = a
2 2
fd' 2  fd'  72  4 
a =   x i =   x 10
N  N  60  60 
= 1.093 x 10 = 10.93
a 10 .93
 CV = x 100 = x 100 = 42.57%
Ya 25 .67
(i) Girls section scores more marks, because the average is more.
(ii) Boys section is more consistent because the CV is more of boys section.
Illustration - 8
Following information relates to two batsman A and B.
Batsman ‘A’ Bastsman ‘B’
No.of innings played 10 10
Average runs scored per innings 45.5 52.5
Standard Deviation 10 11
Solution:
Batsman A Batsman B
Given No.of innings played 10 10
Average run scored x 45.5 52.5
Standard Deviation (  ) 10 11
Find out:
A) Who is better run getter?
Total run = No. of innings x Average score
For A = 10 x 45.5 = 455.
For B = 10 x 52.5 = 525
Batsman B is more run getter.
B) Who is consistent batsman? Use co-efficient of variation.
Batsman A
SD  10
CV = = x 100 = x 100 = 21.97%
Mean x 45.5
Batsman B
 11
CV = x 100 = x 100 = 20.95%
x 52.5
Since coefficient of variation is more in case of batsman A, hence batsman B is
a more consistent batsman.
Illustration - 9 Notes
The following are some of the particulars of the distribution of weights of boys and
girls in a class.
Boys Girls
Number 100 50
Mean weight 60 kgs 45 kgs
Variance 9 4
i) Find the Standard Deviation ii) Which of the two distributions is more variable?
Solution:
i) Standard Deviation = Variance
SD for Boys = 9 3
SD for Girls = 4 = 2
ii) Compute co-efficient of variation:
S tan dard deviation

Co-efficient of variation =  100
Mean
3
CV for Boys =  100  5%
60
2
CV for Girls =  100  4.44%
45
Since, Co-efficient of variation for boys is more than Girls, Boys are more variable.
Illustration - 10
X Ltd. is actively considering the following two mutually exclusive projects for
adoption.
Year Project (X) Project (Y)
Cash profit (` in lakhs) Cash profit (` in lakhs)
1 10 5
2 5 25
3 20 45
4 40 30
5 60 30
Which is the most risky project (Use co-efficient of variation)
Solution:
Co-efficient of Variation for X
X d=X- X d2
10 - 17 289
5 - 22 484

Notes 20 -7 49
40 13 169
60 33 1089
135 2
d = 0  d = 2080
X 135
X    27
N 5
2 2
d 2  d  2,080  0 
SD of X =   =   = 416  20.4
n  n  5  135 
SD 20.4
CV for X =  100 =  100  75.54%
X 27
Co-efficient of Variation for Y
Y d=Y- Y d2
5 -22 484
25 -2 4
45 18 324
30 3 9
30 3 9
135 2
d = 0  d = 830
135
Y =  27
5
2
d 2  d  830  0  830
SD for Y =   =   =  0  166  12.88
n  n  5 5 5
SD 12.88
CV for Y =  100   100 = 47.7%
Y 27
Since CV for X is more than CV of Y Project X is most risky.
Illustration - 11
Following data represents lives of 2 models of refrigerators A and B.
Life(No. of Years): 0 - 2 2 - 4 4 - 6 6 - 8 8 - 10 10 - 12
Model A: 5 16 13 7 5 4
Model B: 2 7 12 19 9 1
a) Find the average life of each model.
b) Which model has great uniformity of life?
x 5 x 5
d =
2 2
Model A Model B Notes

CI x d d2 f fd fd2 f fd fd2
0 - 2 1 -2 4 5 -10 100 2 -4 16
2 - 4 3 -1 1 16 -16 256 7 -7 49
4 -6 5 0 0 13 0 0 12 0 0
6 - 8 7 1 1 7 7 49 19 19 361
8 - 10 9 2 4 5 10 100 9 18 3324
10 - 12 11 3 9 4 12 144 1 3 9
2 2
 fd =  fd = n =  fd =  fd =
50 3 649 50 29 759
fd
xA = A + x i Where, A = 5, i = 2
n
3 250  6 256
= 5 + x 2 = = = 5.12
50 50 50
fd 29
xB = A + x i = 5 + x 2
n 50
250  58 308
= = = 6.16
50 50
2
fd 2  fd 
 A =   xi
n  n 
2
649  3 
=   x2 = 12.98  0.0036 x 2
50  50 
= 12.9764 x 2 = 3.6 x 2 = 7.2
2
fd 2  fd 
B =   xi
n  n 
2
759  29 
=   x2 = 15.18  0.3364 x 2
50  50 
= 14.8436 x 2 = 3.85 x 2 = 7.7

C.V = x 100
x
7.2
C.V. of A = x 100 = 140.6%
5.12

Notes B 7.7
C.V. of B = y x 100 = x 100
6.16
= 125%
Model B has greater uniformity of life than model A.
2.12 Summary
Measures of central tendency is a single value which can be considered as
representative of a set of observations and around which the observations can be
considered as Centered is called an ’Average’ (or average value) or a Center of location.
An average is described as a measure of central tendency as it is more or less a
central value around which various values cluster. In the world of CROXTON and COWDEN
“an average is a single value within the range of the data that is used to represent all
of the values in the series.
Median is defined as the value of that item which divides the series into two equal
halves, one half contains all values less than (or equal to) it and the other half containing
all values greater than (or equal to) it. It is also defined as the “central value of the variable.
Mode is derived from the French word “1a mode” meaning fashion. So it can be
regarded as the most fashionable item in the series or the group.
The terms dispersion is used in two Senses. First, it means that all the items in
the group are not of the same value. They differ from one another in size. There is no
uniformity in size. Second, dispersion is used to indicate the measure of differences of
the size of items in the group from their average thus, a measure of deviations of items
from there average is called “the measure of dispersion.
Range is a measure of dispersion which gives the difference between the highest
and the lowest value in the series. The difference between the two extreme values is called
the range.
Mean deviation is the average amount of variations of the items in a distribution from
2.13 Check Your Progress
I. Fill in the Blanks

1. Mean or average used to measure central tendency is called __________
2. The most frequently occurring number in a set of values is called the
____________.
3. Arithmetic mean is 12 and number of observations are 20 then sum of all values
is _________
4. In quartiles, central tendency median to be measured must lie in _____________.
5. The square root of the variance is called the ________ deviation.
6. As a general rule, the _______ is the best measure of central tendency because
it is more precise.

II. True or False Notes

1. Mean or average used to measure central tendency is called Sample mean.
2. Median, mode, deciles and percentiles are all considered as measures of
Averages of position.
3. The most frequently occurring number in a set of values is called the Mode.
4. If most repeated observations recorded are outliers of data then mode is
considered as Poor measure.
III. Multiple Choice Questions

1. Method used to compute average or central value of collected data is considered
as
[a] Measures of positive variation
[b] Measures of central tendency
[c] Measures of negative skewness
[d] Measures of negative variation
2. As a general rule, the _______ is the best measure of central tendency because
it is more precise.
[a] Mean
[b] Median
[c] Mode
[d] Range
3. What is the median of the following set of scores? 18, 6, 12, 10, 14?
[a] 10
[b] 14
[c] 18
[d] 12
4. Median, mode, deciles and percentiles are all considered as measures of
[a] Mathematical averages
[b] Population averages
[c] Sample averages
[d] Averages of position
5. The standard deviation is:
[a] The square root of the variance
[b] A measure of variability
[c] An approximate indicator of how numbers vary from the mean
[d] All the above
6. Quartiles, median, percentiles and deciles are measures of central tendency
classified as
[a] Paired average
[b] Deviation averages
[c] Positioned averages
[d] Central averages

Notes 7. Which of the following is the formula for range?

[a] H + L
[b] L x H
[c] L - H
[d] H – L
2.14 Questions and Exercises
I. Short Answer Questions

1. Define the term mean.
2. What do you mean by arithmetic mean?
3. Define Median.
4. What do you mean by mode?
5. What is measure of dispersion?
6. Define range.
7. What do you mean by quartile deviation?
8. Give the meaning of mean deviation.
9. What do you mean by standard deviation?
10. Define variance.
11. Give the meaning of co-efficient of variation.
II. Extended Answer Questions

1. What are the characteristics of a good measure of central tendency?
2. What are the merits and demerits of arithmetic mean?
3. Explain merits and demerits of mean.
4. What are the merits and demerits of median?
5. Explain merits and demerits of Mode.
6. What are the merits and demerits of range?
7. Distinguish between central tendencies and dispersions.
8. Explain merits and demerits of quartile deviation.
9. Explain merits and demerits of mean deviations.
10. Explain merits and demerits of standard deviation.
11. What are the merits and demerits of co-efficient of variation?
2.15 Key Terms

 Average: An average is a single figure which sums up the characteristics of
a whole group of figures. In the words of clark “average is an attempt to find
one single figure to describe whole of figures.
 Arithmetic mean: Arithmetic mean is defined as the value obtained by dividing
the total values of all items in the series by their number.
 Median: Median is a positional average. The term position refers to the place
of a value in a series the place of median in a series is such that an equal
number of items lies on either side, therefore it is also called a locative average.

 Mode: is defined as the value of the variable which occurs most frequently in Notes
a distribution. In other words it as the most frequent size of item in a series.
 Absolute measures: The dispersion results are expressed in terms of the
amount of variation i.e., in original units are called absolute measures, for
example range, mean deviation, standard deviation etc.
 Relative measures: The dispersion results are expressed in terms of the
degree of variation i.e., ratios or percentages are called relative measures, for
example the coefficient of range, the coefficient mean deviation, the co-efficient
of variation etc.
 SD: Standard deviation is defined as the Square root of the mean of the Squares
of deviations from the mean.
2.16 Check Your Progress: Answers

I. Fill in the Blanks
1. Arithmetic mean 2. Mode
3. 240 4. Second quartile
5. Standard 6. Mean
II. True or False
1. False 2. True
3. True 4. True
III. Multiple Choice Questions
1. (d) 2. (a)
3. (a) 4. (d)
5. (d) 6. (c)
7. (d)
2.17 Case Study

The number of employees, wages per employee and the variance of wages per
employee for two factories are given below:
Factory ‘X’ Factory ‘Y’
No. of employees 50 100
Average wage per employee per month 60 42
Variance of wages per employee er month 16 64
In which factory is there greater variation in the distribution of wages per employee.
Which factory pays more wages?
2.18 Further Readings

1. Richard I. Levin, David S. Rubin, Sanjay Rastogi Masood Husain Siddiqui,
Statistics for Management, Pearson Education, 7th Edition, 2016.
2. Prem.S.Mann, Introductory Statistics, 7th Edition, Wiley India, 2016.
3. Gareth James, Daniela Witten, Trevor Hastie, Robert Tibshirani, An Introduction
to Statistical Learning with Applications in R, Springer, 2016.

Notes 4. Aczel A.D. and Sounderpandian J., “Complete Business Statistics”, 6th edition,
Tata McGraw Hill Publishing Company Ltd., New Delhi, 2012.
5. Anderson D.R., Sweeney D.J. and Williams T.A., Statistics for business and
economics, 11th edition, Thomson (South – Western) Asia, Singapore, 2012.
2.19 Bibliography
1. Srivastava V. K. etal – Quantitative Techniques for Managerial Decision Making,
Wiley Eastern Ltd
2. Richard, I.Levin and Charles A.Kirkpatrick – Quantitative Approaches to
Management, McGraw Hill, Kogakusha Ltd.
3. Prem.S.Mann, Introductory Statistics, 7th Edition, Wiley India, 2016.
4. Aczel A.D. and Sounderpandian J., “Complete Business Statistics”, 6th edition,
Tata McGraw Hill Publishing Company Ltd., New Delhi, 2012.
5. Anderson D.R., Sweeney D.J. and Williams T.A., Statistics for business and
economics, 11th edition, Thomson (South – Western) Asia, Singapore, 2012.
6. Budnik, Frank S Dennis Mcleaavey, Richard Mojena – Principles of Operation
Research - AIT BS New Delhi.
7. Sharma J K – Operation Research- theory and applications-Mc Millan,New Delhi
8. Kalavathy S. – Operation Research – Vikas Pub Co
9. Gould F J – Introduction to Management Science – Englewood Cliffs N J Prentice
Hall.
10. Naray J K, Operation Research, theory and applications – Mc Millan, New Dehi.
11. Taha Hamdy, Operations Research, Prentice Hall of India
12. Tulasian: Quantitative Techniques: Pearson Ed.
13. Vohr.N.D. Quantitative Techniques in Management, TMH.
11. Stevenson W.D, Introduction to Management Science, TMH.


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Summary Statistics 23

Unit 2: Summary Statistics

After studying this unit, you should be able to understand:

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Notes 2.1 Introduction to Measures of Central Tendency

Objectives served by Averages

Averages serves the following purposes:

Characteristics or requisites or properties of good average

1. It is rigidly defined. Its value is always definite.

Essentials of a good Average

The essentials of a good average are as follows:

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2.3 Types of Averages Notes

2.4 Arithmetic Mean

Merits of Arithmetic Mean

Demerits of Arithmetic Mean

Properties of Arithmetic Mean

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Notes Arithmetic Mean for Ungrouped Data

where, X = Arithmetic mean

Sl. No. Value (x)

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Family Income (in `)

2. Short-cut Method or Indirect method

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Roll No. Marks obtained d = 60

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Size of stores No. of pairs d = (x-a) fd

N = 444 fd = 169.5

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Marks Mid values No.of persons d = (x-a) fd

N = 139 fd = – 780

3. Step deviation Method

where X = Arithmetic mean

Calculate the average marks from the following distribution

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= 17.5 + 1.2 = 18.7

Marks obtained by students of a class in statistics calculate Arithmetic Mean

Marks obtained by students of a class in statistics calculate Arithmetic Mean

Marks No. of (x - A) = dx fdx

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3. Step deviation Method Notes

Marks obtained by students of a class in statistics calculate Arithmetic Mean

35 3 (35 – 65) –30/5 –6 –18

Mean for Grouped Data

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Notes 1. Exclusive Method

Calculate Arithmetic Mean from the following data.

ii) Step deviation Method

Calculate Arithmetic Mean from the following data.

10-20 5 10 + 20/2 = 15 (15 – 45) = –30/10 = –3 (5 × –3) = –15

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50-60 10 50 + 60/2 = 55 (55 – 45) = 10/10 = 1 (10 × 1) = 10 Notes

i) Step Deviation Method

N = 270 fdx = (220 - 173) = 47

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3. Arithmetic Mean for open-end classes

Types of open-end classes

Open-end classed are of two types they are:

Calculate AM for the following data

Marks (x) f Class f Mid (x) i = 10 dx f × dx = fdx

Below 20 10 10-20 10 15 –4 –40

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