The arithmetic mean:

The arithmetic mean is best used when the sum of the values is significant. 

For example, your grade in your statistics class. 

If you were to get 85 on the first test, 95 on the second test, and 90 on the third test, your
average grade would be 90.
  
Why don't we use the geometric mean here?

What if you got a 0 on your first test and 100 on the other two?  The arithmetic mean would
give you a grade of 66.6.  The geometric mean would give you a grade of 0!!!  That's just
mean!

This is why we generally require all values to be positive (non-zero) to use the geometric
mean.

The geometric mean:

The geometric mean is best used when the product of the values is significant.

Suppose you have an initial investment of $100.  It yields a 20% return the first year, 40%
return the second year and 60% return the third year.  After three years, you
have $100.00×1.2×1.4×1.6=$268.80.  The arithmetic mean would suggest an average return
of 40% per year. So after 3 years you'd expect to have $100 × (1.4)3=$274.40. That's not
right.

The geometric mean, however, indicates an approximate yearly return of √3 1.2× 1.4 ×1.6
=1.39 . So after 3 years, you'd expect to have $100∗(1.39)3=$268.80$100∗(1.39)3=$268.80,
which is exactly right! 

Note: the arithmetic mean is strictly larger that the geometric mean for non-negative
real numbers, so be careful when a company tells you their investments average a %30
yearly return, as they may be using an arithmetic mean to boost their numbers.

So in a case like an investment, you want to use the geometric mean.

It's worth mentioning that the above examples give such similar results
because I'm only using 3 numbers and they are very close to each
other.  The closer your numbers are to each other, the closer the results
of the different means will be.  All means will be equal if all the values
are the same.

https://www.quora.com/When-is-it-most-appropriate-to-take-the-arithmetic-mean-vs-geometric-
mean-vs-harmonic-mean
 If you’re measuring units that add up linearly in a sequence (such as lengths,
distances, weights), then an arithmetic mean will give you a meaningful
average. For example, the arithmetic mean of the height or weight of
students in a class represents the average height or weight of students in the
class.

If you’re measuring units that multiply in a sequence (such as growth rates

or percentages), then a geometric mean will give you a meaningful
average. For example, the geometric mean of a sequence of different annual
interest rates over 10 years represents an interest rate that, if applied
constantly for ten years, would produce the same amount growth in
principal as the sequence of different annual interest rates over ten years did.

https://www.quora.com/When-is-it-most-appropriate-to-take-the-arithmetic-mean-vs-geometric-
mean-vs-harmonic-mean