STATISTICS

MEASURES
OF
CENTRAL TENDENCY
Meaning:-
‘Measures’ means ‘methods’ and ‘central tendency’ means
the ‘central point’ or the ‘average value’. Finding that central
value is termed as measures of central tendency.

Central Value:-
‘Central value’ is a single value that represents the whole
data. It lies between the two extreme values of a series,
preferably in the middle. Central value helps to summarise
the entire data in single figure. This helps in planning and
memorising.

Definitions of Average:-

❖ “Average is an attempt to find one single figure to describe

the whole figure”.
~ Clark

❖ “An average is sometimes described as a number which is

typical of the whole group”.
~ Leabo
 FEATURES:-
✓Single value representing whole group.
✓Lies between the extreme value, mostly in the middle.
✓Gives a fair idea of the characteristics of the series.
✓Various statistical measures are applied to get average.

ADVANTAGES:-
✓Conclusion can be drawn about a series.
✓ Facilitates comparision between two series.
✓Helpful to summarise entire data and make planning.
✓Forms basis forcalculation of other statistical measures.

AVERAGE
DISADVANTAGES:-
✓Sometimes it may be absurd or impossible, like no. of
children per family is 1.7.
✓The degree of dispersion is not revealed.
✓The average value may not belong to the data set.
✓At times it may be misleading and may prove disastrous.

REQUISITES:-
✓Should be rigidly defined.
✓Should be based on all observations.
✓Simple to understand and calculate.
✓Not to be unduly affected by extreme values.
✓Lesser sampling fluctuations.
✓Capable of further algebraic treatment.
✓Easy interpretation.
 MATHEMATICAL AVERAGE:-
(calculated by applying mathematical formulas)
✓Arithmetic Mean
✓Geometric Mean
✓Harmonic Mean
MEASURES
OF
CENTRAL POSITIONAL AVERAGE:-
(calculated by finding certain position in the series)
TENDENCY ✓Median
✓Quartile
✓Decile
✓Percentile
✓Mode

INDIVIDUAL:-
11,5,17,13,6,9,8,1,5,16

SERIES DISCRETE:-
X 1 2 3 4 5
Y 5 8 7 10 9

CONTINUOUS:-
X 0-10 10-20 20-30 30-40
Y 5 9 10 4
 MEANING:-
AM is the most popular and commonly used
average. AM is more popularly known as average or mean.

ADVANTAGES:-
✓Based on all items of a series.
✓Easy to calculate and understand.
✓Rigidly defined, hence every set has only one mean.
✓Single figure that defines the series fairly.
✓Can be use to calculate dispersion, skewness, etc.
✓Less affected by sampling fluctuations.
✓Centre of gravity balancing either side of a series.
ARITHMETIC
MEAN
DISADVANTAGES:-
✓Not accurate for open-ended classes.
✓AM is unduly affected by extreme observations.
✓Mean of qualitative data cannot be calculated.
✓Sometimes it gives absurd results like no. of children per
family is 1.7.
✓In absence of original data it may lead to fallacious
conclusions

USES:-
✓A student may calculate his average marks in exams.
✓Manufacturer may calculate average cost of a product.
✓A company can calculate its average profit, sales, etc.
✓A family can calculate its average expenditure per
month.
 MEANING:-
GM is defined as the nth root of the product of n
items. For calculating GM no term in the series shall be 0.

ADVANTAGES:-
✓Not much affected by extreme items.
✓Based on all items of the series.
✓Useful in calculating the average percentage increase or
decrease.
✓Rigidly defined, hence all set have only one GM.
✓Gives less weight to small items and more to large items.
✓GM is suitable for algebraic manipulation.
GEOMETRIC
MEAN
DISADVANTAGES:-
✓Cannot be easily understood and interpreted.
✓Requires the knowledge of log and anti-log.
✓GM cannot be calculated if any term is zero or negative.
However if even number of terms are negative then GM
can be calculated.

USES:-
✓To find the percentage increase or decrease in sales,
profit, population, etc.
✓Used for constructing index number.
✓it is used in economic and social field as it gives more
importance to small observations.
✓Accumulated sum can be calculated after a fixed period
at a given rate of interest.
 MEANING:-
HM is defined as the reciprocal of the arithmetic
mean of the reciprocal of individual observations.

ADVANTAGES:-
✓HM is based on all items of the series.
✓Formula of HM can be extended for further algebraic
treatment.
✓Rigidly defined, hence provides no space for personal
judgements.
✓Helpful in calculating the average rates and ratios.
HARMONIC
MEAN
DISADVANTAGES:-
✓Difficult to calculate as it involves calculation of
reciprocals.
✓Does not represent the true character of the series as it
gives large weight to small items.
✓Not popularly used in analysing business problems.
✓If one item is zero, HM cannot be interpreted.

USES:-
✓Used to calculate average rates and ratios, where these
rates and ratios are expressed in two different terms.
✓Used to calculate average speed, increase in profit, etc.
 MEANING:-
Median is defined as the middle value of a set of
MEDIAN observations after these observations are arranged either
in increasing or decreasing order. The median lies in half
of the observation.

QUARTILE:-
When an arranged data set is divided into four
equal parts, each part or quarter is called as quartile. We
have 3 quartiles designated as Q1, Q2 & Q3. Q2 is the
median of the series.

DECILE:-
When the ordered data is divided into 10 equal PARTITION
parts, each part is called as decile. We have 9 deciles
designated as D1, D2, D3, D4, D5, D6, D7, D8 & D9. D5 is VALUES
the median of the distribution.

PERCENTILE:-
When the ordered data is divided into 100 equal
parts, each part is called as percentile. We have 99
percentiles designated as P1, P2, P3, P4, P5, P6, P7, P8,
P9,……………....................., P98 & P99. P50 is the median of
the distribution.
ADVANTAGES:-
✓Median is easy to calculate for any type of data.
✓Unique as there is only one median for a series.
✓Not affected by extreme values.
✓Can be located by graph and sometimes by mere
inspection.
✓Best measure for qualitative data.
✓Can be calculated when class intervals are unequal and
also for open end class.

DISADVANTAGES:-
✓Further algebraic treatment is not possible.
✓Value of median is more affected by sampling
fluctuations.
✓Time consuming and tricky as it involves arranging in
ascending and descending order. MEDIAN
✓Gives wrong result when number of observation is
small.
✓Cannot be precisely calculated in a continuous series
where we assume that the values of the series are evenly
spread over the entire class interval.

APPLICATIONS:-
✓Quick estimate of average is desired.
✓Mathematical calculation cannot be made to obtain
mean.
✓Data are qualitative in nature.
✓Some extreme values are found in data set.
MEANING:-
Mode is that value in a series which occurs
maximum number of times. In other words, mode
represents the value which occurs most frequently in a set
of observations.

ADVANTAGES:-
✓Not affected by extreme observations.
✓Easy to understand and can be located by mere
inspection.
✓Can also be calculated graphically by histogram.
✓Mode can be used to describe character of both
MODE
quantitative as well as qualitative data.
✓Helps the manufacturer to know the most preferred
product. Accordingly he makes his plans of production.

DISADVANTAGES:-
✓Mode is not based on all items of a series of data.
✓It is difficult to locate modal class in case of bi-modal
and tri-modal series. Also difficult to analyse such series.
✓Not capable of further algebraic treatment.
✓Mode is not a rigidly defined measure as there are
several methods of calculating its value. Different
methods yields different results.
EMPIRICAL RELATIONSHIP BETWEEN MEAN, MODE AND MEDIAN

(a) Symmetric

MODE = 3(MEDIAN) – 2(MEAN)