Measures of Central Tendency

Concept of Central Tendency

A measure of central tendency is a typical value around which other figures congregate - Simpson & Kalfa OR An average is a single value which is used to represent all of the values in the series.

Measures of Central Tendency

Mean (mathematical average) Arithmetic Mean Median (positional average)

Mode (positional average)

Harmonic mean

Geometric mean

Simple Arithmetic Mean

Weighted Arithmetic Mean

Mean of Composite Group

Basics
Mean Median Mode Average Mid positional value Most frequently occurring value

Arithmetic Mean Ungrouped (Raw) Data

x = Sum of Observation s Number of Observation s

xi

EXAMPLE
Table 4.1 : Equity Holdings of 20 Indian Billionaires ( Rs. in Millions) 2717 3534 2796 3862 3098 4186 3144 4310 3527 4506

4745
5424

4784
5561

4923
6505

5034
6707

5071
6874

Example
For the above data, the A.M. is

2717 + 2796 + 4645+.. + 5424 + .+ 6874 -------------------------------------------------------------------------20

= Rs. 4565.4 Millions

Arithmetic Mean Grouped Data

N=

f x x= f
i

i i

i =1

= Total frequency

fi

Here, xi is the mid value of the class interval.

example
Calculate arithmetic mean from the following frequency distribution of marks at a test in statistics. Marks 25 30 35 40 45 50 55 60 No.of students 2 3 4 8 9 4 3 2

 The details of the monthly salary of 100 employees of a firm are given below:
Monthly salary (in Rs.) 1000 1500 2000 2500 3000 5000 No. of employees 18 26 31 16 5 4

 In grouped data, the middle value of each group is the representative of the group bz when the data are grouped, the exact frequency with which each value of the variable occurs in the distribution is unknown. We only know the limits within which a certain number of frequencies occur. So, we make an assumption that the frequencies within each class are distributed uniformly over the range of class interval.

Example
A company manufactures polythene bags. The bags are evaluated on the basis of their strength by buyers. The strength depends on their bursting pressures. The following data relates to the bursting pressure recorded in a sample of 90 bags. Find the average bursting pressure.

example
Bursting pressure (1) 5-10 No. of bags ( fi ) ( 2 ) 10 Mid Value of Class Interval ( xi ) ( 3 ) 7.5 Fixi ( 4 ) Col.(4) = Col.(2) x Col.(3) 75

10-15
15-20 20-25 25-30

15
20 25 20

12.5
17.5 22.5 27.5

187.5
350 562.5 550

Sum

fi =90

fixi =1725

values of fi and fixi , in formula

f x x= f
i
= 1725/90

i i

19.17

EXAMPLE (short cut method)

Calculate the mean of the following distribution of monthly wages of workers in a factory : Monthly wages(in Rs.) 100-120 120-140 140-160 160-180 No. of workers 10 20 30 15

180-200

 The following frequency distribution represents the time taken in seconds to serve customers at a fast food take away. Calculate the mean time taken by to serve customers

Time taken (in seconds) 40-60 60-80 80-100 100-120 120-140 140-160

frequencies 6 12 15 12 10 5

Weighted Arithmetic Mean

It takes into account the importance of each value to the overall data with the help of the weights. Frequency i.e. the no. of occurrence indicates the relative importance of a particular data in a group of observations. Used in case the relative importance of each observation differs or when rates, percentages or ratios are being averaged.

 The weighted AM of the n observations:

x x=
wi

wi

AM is considered to be the best measure of central tendency as its computation is based on each and every observation.

Example
5 students of a B.Sc. (Hons) Stud course are marked by using the ent following weighing scheme :
Mid-term = 20% Project = 10% Attendance = 10% Final Exam = 60% Calculate the average marks in the examination. Marks of the students in various components are:

1 2 3 4

midt Proje Atten Fin erm ct dnce al 65 70 80 80 48 58 58 58 63 70 54 65 54 60 50 60

60

65

70

70

 A professor is interested in ranking the following five students in the order of merit on the basis of data given below: Attendance average will count for 20% of a students grade; the homework 25%; assignment 35%; midterm examination 10% and final examination 10%. What would be the students ranking.

Stud Atte Hom ent ndan ewo ce rk A 85 89 B 78 84 C 94 88 D 82 79 E 95 90

Assi gnm ent 94 88 93 88 92

Midt final erm 87 91 86 84 82 90 92 89 93 88

Mean of composite group

If two groups contain respectively, n1 and n2 observations with mean X1 and X2, then the combined mean (X) of the combined group of n1+n2 observations is given by :
X 12 n1 X 1 n2 X 2 = n1 n2

Example
There are two branches of a company employing 100 and 80 employees respectively. If arithmetic means of the monthly salaries paid by two branches are Rs. 4570 and Rs. 6750 respectively, find the A.M. of the salaries of the employees of the company as a whole.

 A factory has 3 shifts :- Morning, evening and night shift. The morning shift has 200 workers, the evening shift has 150 workers and night shift has 100 workers. The mean wage of the morning shift workers is Rs. 200, the evening shift workers is Rs. 180 and the overall mean of the workers is Rs. 160. Find the mean wage of the night shift workers.

Properties of A.M.
If a constant amount is added or subtracted from each value in the series, mean is also added or subtracted by the same constant amount. E.g. Consider the values 3,5,9,15,16 A.M. = 9.6 If 2 is added to each value, then A.M. = 11.6 = 9.6 + 2. Thus, mean is also added by 2. Sum of the deviations of a set of observations say x1, x2, , xn from their mean is equal to zero. A.M. is dependent on both change in origin and scale. The sum of the squares of the deviations of a set of observation from any number say A is least when A is X.

Merits and demerits of

Arithmetic Mean
Advantages Disadvantages

(i) Easy to understand and calculate (ii) Makes use of full data (iii) Based upon all observations.

the

(i ) Unduly influenced by extreme values (ii) Cannot be calculated from the data with open-end class.e.g. below 10 or above 90 (iii) It cannot be obtained if a single observation is missing. (iv) It cannot be used if we are dealing with qualitative characteristics which cannot be measured quantitatively; intelligence, honesty, beauty etc

Harmonic Mean
The harmonic mean (H.M.) is defined as the reciprocal of the arithmetic mean of the reciprocals of the observations. For example, if x1 and x2 are two observations, then the arithmetic means of their reciprocals viz 1/x1 and 1/ x2 is

{(1 / x1) + (1 / x2)} / 2 = (x2 + x1) / 2 x1 x2

The reciprocal of this arithmetic mean is 2 x1 x2 / (x2 + x1). This is called the harmonic mean. Thus the harmonic mean of two observations x1 and x2 is 2 x1 x2
-----------------

x1 + x2

 In general, for the set of n observations X1,X2..Xn, HM is given by :

HM = n 1 x i

And for the same set of observations with frequencies f1,f2..fn, HM is given by:
HM = n fi x i

 HM gives the largest weight to the smallest item and the smallest weight of the largest item If each observation is divided by a constant, K then HM is also divided by the same constant. If each observation is multiplied by a constant, K then HM is also multiplied by the same constant. It is used in averaging speed, price of articles.

 If time varies w.r.t. a fixed distance then HM determines the average speed. If distance varies w.r.t. a fixed time then AM determines the average speed. EXAMPLE : If a man moves along the sides of a square with speed v1, v2, v3, v4 km/hr, the average speed for the whole journey = 4
(1/v1)+(1/v2)+(1/v3)+(1/v4)

EXAMPLE
In a certain factory a unit of work is completed by A in 4 min, by B in 5 min, by C in 6 min, by D in 10 min, and by E in 12 minutes.
What is the average no. of units of work completed per minute?

Example
The profit earned by 19 companies is given below: Profit (lakhs) 20-25 25-30 No. of companies 4 7

calculate the HM of profit earned.

30-35
35-40

4
4

Geometric Mean
Neither mean, median or mode is the appropriate average in calculating the average % rate of change over time. For this G.M. is used. The Geometric Mean ( G. M.) of a series of observations with x1, x2, x3, ..,xn is defined as the nth root of the product of these values . Mathematically G.M. = { ( x1 )( x2 )( x3 ).(xn ) } (1/ n ) It may be noted that the G.M. cannot be defined if any value of x is zero as the whole product of various values becomes zero.

 When the no. of observation is three or more then to simplify the calculations logarithms are used. log G.M. = log X1 + log X2 + + log Xn N G.M. = antilog (log X1 + log X2 + + log Xn) N For grouped data, G.M. = antilog (f1log X1 + f2log X2 + + fnlog Xn) N

Geometric mean
GM is often used to calculate the rate of change of population growth. GM is also useful in averaging ratios, rates and percentages.

EXAMPLE
A machinery is assumed to depreciate 44% in value in first year, 15% in second year and 10% in next three years, each percentage being calculated on diminishing value. What is the average % of depreciation for the entire period?

Compared to the previous year the overhead expenses went up by 32% in 2002; they increased by 40% in the next year and by 50% in the following year. Calculate the average rate of increase in the overhead expenses over the three years.

Example
The annual rate of growth for a factory for 5 years is 7%,8%,4%,6%,10%respectively.What is the average rate of growth per annum for this period. The price of the commodity increased by 8% from 1993 to 1994,12%from 1994 to 1995 and 76% from 1995 to 1996.the average price increase from 1993 to 1996 is quoted as 28.64% and not 32%.Explain and verify the result.

37

Combined G.M. of Two Sets of Data

If G1 & G2 are the Geometric means of two sets of observations of sizes n1 and n2, then the combined Geometric mean, say G, of the combined series is given by : n1 log G1 + n2 log G2 log G = ------------------------------n1 + n2

Example
The GM of two series of sizes 10 and 12 are 12.5 and 10 respectively. Find the combined GM of the 22 observations.

Combined G.M. of Two Sets of Data

log G = 10 log 12.5 + 12log 10 ------------------------------10 + 12 22.9691 = ------------ = 1.04405 22

Therefore, G = antilog 1.04405 = x Thus the combined average rate of growth for the period of 22 years is x%.

Relationship Among A.M. G.M. and H.M.

The relationships among the magnitudes of the three types of Means calculated from the same data are as follows: (i) H.M. G.M. A.M. i.e. the arithmetic mean is greater than or equal to the geometric which is greater than or equal to the harmonic mean.

( ii ) G.M. = A.M * H .M . i.e. geometric mean is the square root of the product of arithmetic mean and harmonic mean. ( iii) H.M. = ( G.M.) 2 / A .M.