Mean Deviation

(For M.B.A. I Semester)

by Prof. Nitin Karoulia

9033099006
 Mean Deviation or Average Deviation
The two measures of dispersion discussed so far viz., range and
quartile deviation are not based on all the observation and also
they do not exhibit any scatter of the observations from an average
and thus completely ignore the composition of the series. Mean
Deviation or the Average Deviation overcomes both these
drawbacks. As the name suggests, this measure of dispersion is
obtained on taking the average (arithmetic mean) of the deviations
of the given values from a measure of central tendency. According
to Clark and Schkade:

“ Average deviation is the average amount of scatter of the items in a

distribution from either the mean or the median, ignoring the
signs of the deviation. The average that is taken of the scatter is an
arithmetic mean, which accounts for the fact that this measure is
often called the mean deviation.”
 Computation of Mean Deviation
If X1, X2,……., Xn are n given observations then the mean
deviation (M.D.) about an average A, say , is given by:
M.D. (about average A) = 1 ∑ X- A = 1 ∑ d
n n
Where d = X – A read as mod (X-A)is the modulus value or
absolute value of the deviation (after ignoring the negative
sign) d= X-A and ∑ d is the sum of these absolute deviation
and A is any one of average Mean (M), Median (Md) and
Mode (Mo).
 Computation of Mean Deviation
Steps for Computation of Mean Deviation
1. Calculate the average A of the distribution by the usual
methods.
2. Take the deviation d= X-A of each observation from the
average A.
3. Ignore the negative signs of the deviations, taking all the
deviations to be positive to obtain the absolute deviations, d
=X–A.
4. Obtain the sum of the absolute deviations obtained in step 3.
5. Divide the total obtained in step 4 by n, the number of
observations.
The result gives the value of the mean deviation about the
average A.
 Computation of Mean Deviation
The result gives the value of the mean deviation about the
average A.
In the case of frequency distribution or grouped or continuous
frequency distribution, mean deviation about an average A is
given by:
M.D. (about the average A) =1 ∑f X – A = 1 ∑f d
n n
where X is the value of the variable or it is the mid-value of the
class interval (in the case of grouped or continuous
frequency distribution), f is the corresponding frequency ,
N=∑f, is the total frequency and X-A is the absolute value of
the deviation d= (X-A) of the given values of X from the
average A (Mean, Median or Mode).
 Computation of Mean Deviation
Steps for Computation of Mean Deviation for Frequency
Distribution .
Step 1,2 and 3 are same as given above.
4. Multiply the absolute deviations 1d1=1X-A1 by the
corresponding frequency f to get f1d1.
5. Take the total of products in step 4 to obtain ∑f1d1.
6. Divide the total in step 5 by N, the total frequency.
The resulting value is the mean deviation about the average A.
Remarks 1. Usually, we obtain the mean deviation(M.D.) about
any one of the three averages mean (M), median (Md) or
mode (Mo). Thus
 Computation of Mean Deviation
M.D. (about mean) = 1 ∑f X-M
n
M.D. (about median) = 1 ∑f X-Md
n
M.D. (about mode) = 1 ∑f X-Mo
n

2. The sum of the absolute deviations (after ignoring the signs) of

a given set of observations is minimum when taken about
median. Hence mean deviation is minimum when it is
calculated from median. In other words, mean deviation
calculated about median will be less than mean deviation
about mean or mode.
 Computation of Mean Deviation
3. As already pointed out in Remark 1, usually, we compute the
mean deviation about any one of the three average mean,
median or mode. But since mode is generally ill-defined, in
practice M.D. is computed about mean or median. Further, as a
choice between mean and median, theoretically, median should
be preferred since M.D. is minimum when calculated about
median (c.f. Remark 2). But because of wide applications of
mean in Statistics as a measure of central tendency, in practice
mean deviation is generally computed from mean.
4. For a symmetrical distribution the range Mean + M.D. (about
mean) or Md + M.D. (about median), [.. M= Md for a
symmetrical distribution] covers 57.5% of the observations of
the distribution. If the distribution is moderately (skewed), the
range will cover approximately 57.5% of the observations.
Short-Cut Method of Computing Mean Deviation
For computing the mean deviation, first of all we have to
calculate the average about which we want the mean
deviation, by the methods discussed in the previous chapter.
In case the average is a whole number, the method of
computing mean deviation by formulae (6-10), (6-11) or (6-
12) is quite convenient. But if the average comes out in
fractions, this method becomes fairly tedious and time
consuming and requires lot of algebraic calculations. In such
a case we compute the mean deviation by taking the
deviation from an arbitrary point ‘a’, near the average value
and applying some corrections as given below:
M.D. (about Mean) = 1 ∑f 1 X-a1 + (M-a) (∑ fB-∑fA)
N
Short-Cut Method of Computing Mean Deviation
Where
M is the mean,
a is the arbitrary constant near the mean,
∑fB is the sum of all the class frequencies before and including the
mean value,
And ∑fA is the sum of all the class frequencies after the mean
value.
Similarly, using the short cut method,
M.D. (about median) = 1 ∑f 1X –a 1 + (Md-a) (∑fB’-∑fA’)
N
where now, Md is the median, a is some arbitrary constant near
the median, ∑fB’ is the sum of the class frequencies before and
including the median value, and ∑fA’ is the sum of the class
frequencies after the median value.
Short-Cut Method of Computing Mean Deviation
Remarks 1. Obviously,
∑fA + ∑FB = N
∑fB = N -∑fA
or ∑fA = N- ∑fB
Similarly ∑fB’ = N- ∑fA’

2. The above formulae (6-13) and (6-13a) are true provided all
the values of the variable which are above the average (M or
Md) are also above ‘a’ and those which are below the average
are also below ‘a’. The arbitrary constant ‘a’ should be taken
some arbitrary integral value near the average value, i.e.., it
should be a value in the average class. The short cut method
will not yield correct result if ‘a’ is taken outside the average
class.
Merits and Demerits of Mean Deviation
Merits: (i) Mean deviation is rigidly defined and is easy to
understand and calculate.
(ii) Mean deviation is based on all the observation and is thus
definitely a better measure of dispersion than the range and
quartile deviation.
(iii) The averaging of the absolute deviations from an average
irons out the irregularities in the distribution and thus mean
deviation provides an accurate and true measure of
dispersion.
(iv) As compared with standard deviation (discussed in next
article $ 6-9), it is less affected by extreme observations.
(v) Since mean deviation is based on the deviations about an
average, it provides a better measure for comparison about
the formation of different distributions.
Merits and Demerits of Mean Deviation
Demerits: (i) The strongest objection against mean deviation is that
while computing its value we take the absolute value of the
deviations about an average and ignore the signs of the
deviations.
(ii) The step of ignoring the signs of the deviations is mathematically
unsound and illogical. It creates artificially and renders mean
deviation useless for further mathematical treatment. This
drawback necessitates the requirement of another measure of
variability which, in addition to being based on all the
observations is also amenable to further algebraic manipulation.
(iii) It is not a satisfactory measure when taken about mode or while
dealing with a fairly skewed distribution. As already pointed out,
theoretically mean deviation gives the best result when it is
calculated about median. But median is not a satisfactory
measure when the distribution has great variations.
Merits and Demerits of Mean Deviation
Demerits: (iv) It is rarely used in sociological studies.
(v) It cannot be computed for distribution with open end classes.
(vi) Mean deviation tends to increase with the size of the sample though
not proportionately and not so rapidly as range.

Uses. In spite of its mathematical drawbacks, mean deviation has found

favor with economists and business statisticians because of its simplicity,
accuracy and the fact that standard deviations gives greater weight-age
to the deviations of extreme observations. Mean deviation is frequently
useful in computing the distribution of personal wealth in a community
or a nation since for this, extremely rich as well as extremely poor
people should be taken into consideration. Regarding the practical utility
of mean deviation as a measure of variability, it may be worthwhile to
quote that in the studies relating to forecasting business cycles, the
National Bureau of Economic Research has found that the mean
deviation is most practical measure of dispersion to use for this purpose.
Relative Measures of Mean Deviation
The measures of mean deviation as defined in (6-10) , (6-11) and
(6-12) are absolute measures depending on the units of
measurement. The relative measure of dispersion, called the
coefficient of mean deviation is given by:
Coefficient of M.D. = Mean Deviation …(6.15)
Average about which it is calculated
.. Coefficient of M.D. about mean= M.D. ……. (6.15a)
Mean
and Coefficient of M.D. about median= M.D. …….(6.15b)
Median
The coefficient of mean deviation defined in (6.15), (6.15a) and
(6.15b) are pure numbers independent of the units of
measurement and are useful for comparing the variability of
different distributions.
 Mean Deviation (MD)

M
X

MD X MDM
 A. Individual Series:-

MDX = ∑ I dx I where I dx I = I x-x I and N is No. of items

N
Coef of MDX = MDx
x x= 30
Marks I dx I = I x-x I
(X) MDx = ∑ I dx I = 60 = 12
10 10-30 = 20 N 5
20 10
30 0 Coef. Of MDx = MDx = 12 = ?
40 10 x 30
50 20
∑X=150 ∑I dx I = 60
x = ∑x/N =150/5=30
 B. Discrete Series:-

MDX = ∑f I dx I I dx I = I x-x I
∑f
Coef of MDX = MDx
x x= 28.88
X f fx I dx I = I x-x I f I dxI MDx = ∑f IdxI
10 3 30 10-28.88=18.88 56.64 ∑f
20 6 120 8.88 53.28 = 220 = 12.22
30 2 60 1.12 2.24 18
40 4 160 11.12 44.48 Coef. Of MDx = MDx
50 3 150 21.12 63.36 x
∑f=18 ∑fx=520 ∑f IdxI = 220 = 12.22 = ?
28.88
x = ∑fx = 520 = 28.88
∑f 18
 C. Continuous Series:-

MDX = ∑f I dx I I dx I = I m-x I
∑f
Coef of MDX = MDx
x x= 25.52
C.I f Midpoint M fm I dxI = Im-xI f IdxI MDx = ∑fIdxI
0-10 3 5 15 5- 25.52 =20.52 61.56 ∑f
10-20 5 15 75 10.52 52.6 = 230.52
20-30 2 25 50 0.52 1.04 19
30-40 6 35 210 9.48 56.08 =?
40-50 3 45 135 19.48 58.44
∑f=19 ∑fm=485 ∑f IdxI = 230.52

x = ∑fm = 485= 25.52

∑f 19
Thank you