Measures of

Central Tendency – Introduction

 Requisites of a Good Average
Should be

rigidly defined

mathematically expressed

readily comprehensible and easy to calculate.

calculated based on all the observations.

least affected by extreme fluctuations in sampling data.

suitable for further mathematical treatment.

Situation

The Weekly sales of basket ball between the months of April and
May, at Decathlon for 9 weeks are as follows. Find the average
sales and help the supervisor in taking the appropriate decisions
for the coming weeks.

Week 1 2 3 4 5 6 7 8 9
Sales in
7 11 16 17 15 12 11 1 1
Number
Measures of Central Tendency & Dispersion

Measures

Central Tendency Dispersion

(Variation)
Arithmetic Mean Range
Mathematical
Averages Interquartile Range
Weighted Mean
Variance
Median Standard Deviation
Positional
Mode Averages
Coefficient of
Variation
World of sales

Average sales across different periods can give you a better idea of
how well your sales strategies and marketing campaigns are
performing. Which tactics are connecting with consumers, and how
successful your sales team is at converting leads
Another example

Ravi Kumar already knows that TCS as a company is doing

extremely well in the market. However before investing in
TCS, he wanted to reconfirm his decision. As a result he
looked into past share prices of TCS for almost an year and
calculated the mean stock price of TCS
 Mean (Arithmetic Average)
The most common measure of central tendency

Mean = sum of values divided by the number of values

Affected by extreme values (outliers)

0 1 2 3 4 5 6 7 8 9 10 0 1 2 3 4 5 6 7 8 9 10

Mean = 3 Mean = 4
Time for Some notation:

Population Sample
All items under consideration A portion of the population
by researcher selected for study

μ = population mean x = sample mean

Ν = population size n = sample size
Mean (Arithmetic Average) from ungrouped data

• The Mean is the arithmetic average of data values

• Sample mean n = Sample Size

• Population mean N = Population Size

Calculate the Arithmetic Mean of Ungrouped
Frequency

The Weekly sales of basket ball between the months of April and
May, at Decathlon for the past 9 weeks are as follows:

Week 1 2 3 4 5 6 7 8 9
Sales in
7 11 16 17 15 12 11 1 1
Number
The Sample Mean for an Ungrouped Frequency
Distribution - Example

9 basket balls per week are being sold at Decathlon.

Try it out..

Wages earned by a worker for one week are

₹ 50, 60, 63, 43, 46 and 38
Find average wage of the worker using arithmetic mean.
Quiz Time:

Which of the following is true of the Arithmetic mean

a. It uses all the data

b. it is not affected by extreme values
c. It is the middle observation
d. it is the most common observed value of the dataset
Special case of Arithmetic Mean – The weighted
Mean
The wages of each of the skilled, semiskilled and unskilled workers in a
factory are as follows. Calculate weighted mean for the following data

Type Wages per day No. of Workers

(X) (W)
Skilled
250 50
Semiskilled
200 40
Unskilled
150 25
The Weighted Mean

Weighted Mean uses different weightages to the observations according

to their relative importance
The Weighted Mean Calculation

The weighted mean wages of the workers in the factory is ₹ 210.87

How far have we reached?

Measures

Central Tendency Dispersion

(Variation)
Arithmetic Mean Range
Mathematical
Averages Interquartile Range
Weighted Mean
Variance
Median Standard Deviation
Positional
Mode Averages
Coefficient of
Variation
 Food for thought

The number of runs scored by 10 Indian cricket batsmen in a one day

match are as follows:
• 3, 198, 15, 0, 22, 18, 20, 7, 11 & 9

Find the average runs made by the team. What are your observations
from the average?
The Sample Mean for an Ungrouped Frequency
Distribution - Example

The average runs made by all the players together is

30.3
Further ..

Staff 1 2 3 4 5 6 7 8 9 10
Salary in
‘000s of 15 18 16 14 15 15 12 17 90 95
Rupees

The mean salary for these ten staff is ₹30.7k. However, inspecting the raw
data suggests that this mean value might not be the best way to
accurately reflect the typical salary of a worker, as most workers have
salaries in the ₹12k to 18k range
Food for thought

Consider the wages of 10 staff at a factory below:

Staff 1 2 3 4 5 6 7 8 9 10
Salary in
‘000s 15 18 16 14 15 15 12 17 90 95

Outliers Exist – 90 and 95

Arithmetic Mean does not represent the center

Position or location decides the center

Median is the better over Arithmetic Mean

Summarizing the Mean

Most often, the Mean is selected by default

Mean is sensitive to any change in the value of the observation -

Advantage

Mean is very sensitive to outliers - Disadvantage

One must consider the data and the distribution to choose the
appropriate measure
 Measures of
Central Tendency – Positional
Averages (Ungrouped Data)
How far have we reached?

Measures

Central Tendency Dispersion

(Variation)
Arithmetic Mean Range
Mathematical
Averages Interquartile Range
Weighted Mean
Variance
Median Standard Deviation
Positional
Mode Averages
Coefficient of
Variation
 Food for thought

The number of runs scored by 10 Indian cricket batsmen in a one day

match are as follows:
• 3, 198, 15, 0, 22, 18, 20, 7, 11 & 9

Find the average runs made by the team. What are your observations
from the average?
The Sample Mean for an Ungrouped Frequency
Distribution - Example

The average runs made by all the players together is

30.3
 Median with Even Number of observations

The number of runs scored by 10 Indian cricket batsmen in a one day match are as
follows:
• 3, 198, 15, 0, 22, 18, 20, 7, 11 & 9
Find the average runs made by each player.
Arrange the data in ascending order. Take the middle two values and find the
average of the two values
• 0, 2, 7, 9, 11, 15, 18, 20, 22, 198
• Median with Even Number of observations in a data set is obtained by
taking the mean of the two middle numbers
The median, = (11+15) / 2 = 13 Runs

Unlike Arithmetic mean, it does not consider extreme values or outliers

The Median – with odd number of observations

The number of basket balls sold in Decathlon are

7, 11,16, 17, 15, 12, 11, 1,1

Find the Median

• Arrange the observations in ascending order
• 1,1,7, 11,11, 12, 15,16, 17
• Select the middle value
• 1,1,7, 11, 11, 12, 15,16, 17
• The median of the number of basket balls per week is 11
Measures of Central Tendency – Median

Median is the value of a variable such that half of the observations are
above and half are below this value i.e. this value divides the
distribution into two groups of equal size

When the number of observations is odd, the median is simply equal to

the middle value

When the number of observations is even, we take the median to be

the average of the two values in the middle of the distribution

Median is unaffected by extremely large or extremely small values

Applications of Median

To find the performance of a cricketer where his worst & best

extreme performance can be ignored to give his consistent
performance

You may hear about the Median salary for a country or a city.
When the average income for a country is discussed, the Median is
used most often
Time for problems

Calculate Median for the following data

22,26,14,32,18,11,35,41,12,32
Quiz Time

In an organization of 50 people, one person earns 50,00,000 per annum

and each of the others 49 earn 30,000 per annum. Which is the better
measure of centre to calculate the average?

A. Arithmetic Mean

B. Median

C. Mode

D. Weighted Average
Measures of Central Tendency – Mode

Mode - This is the most frequently occurring value in the distribution

The mode allows the distribution's peak to be located quickly

A dataset can have no mode at all

A data set can have more than one mode

Calculate the Mode of Ungrouped Frequency

The Weekly sales of basket balls at Decathlon for the past 9 weeks
are as follows:
Data set: 7, 11,16, 17, 15, 12, 11, 1,1
There are two modes (bimodal) to this situation. The values 1 and
11 are repetitive.
Calculate the Mode of Ungrouped Frequency

Twelve different cars were tested at a speed of 40kmph for stopping

distances. The distances in km, are given below. Find the mode

Data Set : 3,5,7,2,1,7,4,8,6,9,7,10

Mode is the repetitive observation of the dataset

There is one mode to this situation. The value 7 is repetitive

Size of the shoe in Bata No. of Buyers
showroom for women
4 7
5 11
6 19
7 9
8 3
Other cases of Mode

Seven strains of corona virus were tested to see how long they could
remain alive in the air. The time in hours is given below. Find the mode

Data Set : 4, 2, 6, 7,5, 9, 3

There is no mode to this situation since each data value occurs equally
with a frequency of one. Mode is not the appropriate measure in this
case.
Applications of Mode

Which is the most preferred automobile brand used by Indians?

Manager can find out which is the peak season for sales?

Retailer can find out which day of the week has maximum customer
footfalls?

The best seller option when you browse for products in amazon.in uses
the concept
Measures of Center and Location
Overview
Center and Location

Mean Median Mode Weighted Mean

Summary of Central Tendency Measures Ungrouped -
Example

Measure of Central Tendency Average Sale of Basket Balls at

Decathlon
Mean 9

Median 11

Mode 1 & 11
Quiz Time

The mode for the following ungrouped data

12,14,16,18,26,16,21,23,16,13,16,15,20,24

a. 16
b. 22
c. No mode
d. Bi modal
Calculate Mean, Median & Mode

Wages earned by a worker for one week are

₹ 50, 60, 63, 43, 46 and 38
Find average wage of the worker using all the three measures
 Measures of
Central Tendency – Grouped
Data
Arithmetic Mean– Grouped data
A sample is drawn to understand the number of hours
spent watching Netflix and Hotstar by the viewers in
Bangalore. Compare and give your observations using
appropriate central tendency measure.

Hours Spent No. of No. of

on watching Netflix Hotstar
Viewers Viewers
0–4 6 8
4–8 5 5
8 - 12 6 7
12 - 16 4 2
16 - 20 4 3
The Sample Mean for a Grouped Frequency
Distribution

The mean for a grouped frequency

distribution is given by

∑(f ⋅X )
X = m
.
n
Her X is the correspond
m
ing
e
class midpoint.
The Sample Mean for a Grouped Frequency
Distribution
The Sample Mean – Netflix Viewers
The Sample Mean – Hotstar viewers
The Median from Grouped data
For a population:

( N / 2) − F
ΜΔ = L + w
f
For a sample:

( n / 2) − F
md = L + w
f
L = the median class’s lower limit
f= its absolute frequency
w= its width
F= the sum of frequencies up to
(but not including) those of
the median class

The Median
7.58
 The Sample Median for a Grouped Frequency
Distribution - Example
A travel agency offers 5 different packages for a 3 day 2 night trip trekking trip to ooty.
The packages vary based on the type of accommodation, food preferences and mode of
travel. The packages in thousands of rupees is given as class interval and the number of
tourists preferring a package is given as frequency. The minimum cost of the package is
₹ 15,000 and the maximum is ₹ 40,000. The tourism operator, would wish to know the
average expense a tourist spends for such a trip. He took the data of 17 tourists.

Class Interval
Class (₹’000) No. of Tourists
Frequency, f (f)
15 - 20
15.5 - 20.5 33
20 - 25
20.5 - 25.5 55
25 - 30
25.5 - 30.5 44
30 - 35
30.5 - 35.5 33
35 - 40
35.5 - 40.5 22
5

5
The Sample Median – Tourism Example
The median can be computed from:
( n 2 ) − cf
MD = ( w) + Lm
f
Where
n = sum of the frequencies
cf = cumulative frequency of the class
immediately preceding the median class
f = frequency of the median class
w = width of the median class
Lm = lower boundary of the median class
 Class
Class Frequency,
Frequency,ff Cumulative
Cumulative
Frequency
Frequency
15 - 20
15.5 - 20.5 33 33
20 - 25
20.5 - 25.5 55 88
25 - 30
25.5 - 30.5 44 12
12
30 - 35
30.5 - 35.5 33 15
15
35 - 40
35.5 - 40.5 22 17
17
5

5
n =17
cf = 8
f = 4
w = 25 –20 = 5
Lm = 25.
(n 2) − cf (17/ 2) – 8
MD = +
(w) Lm = (5) + 25.
f 4
= 25.625.
 Measures of
Central Tendency – Mode
(Grouped Data)
Mode – A Quick Recap

Mode - This is the most frequently occurring value in the distribution

The mode allows the distribution's peak to be located quickly

A dataset can have no mode at all

A data set can have more than one mode

Size of the shoe in Bata No. of Buyers
showroom for women
4 7
5 11
6 19
7 9
8 3
 The Sample Mode for a Grouped Frequency
Distribution - Example
A travel agency offers 5 different packages for a 3 day 2 night trip trekking trip to oty.
The packages vary based on the type of accommodation, food preferences and mode of
travel. The packages in thousands of rupees is given as class interval and the number of
tourists preferring a package is given as frequency. The minimum cost of the package is
₹ 15,000 and the maximum is ₹ 40,000. The tourism operator, would wish to know the
average expense a tourist spends for such a trip. He took the data of 17 tourists.

Class Interval
Class (₹’000) No. of Tourists
Frequency, f (f)
15 - 20
15.5 - 20.5 33
20 - 25
20.5 - 25.5 55
25 - 30
25.5 - 30.5 44
30 - 35
30.5 - 35.5 33
35 - 40
35.5 - 40.5 22
5

5
The Sample Mode – Tourism Example
The Mode for grouped data

d1 = f1-f0d2 = f1-f2

L = lower limit of the Modal class

f1 =Frequency corresponding to Modal class

f0 =Frequency preceding to Modal class

f2 = Frequency succeeding to Modal class

i = width of the Model interval

The Sample Mode – Tourism Example
 The Mode for grouped data

The number that occurs most frequently in a set of numbers

If data contain class intervals, mode is found by:

d1 = f1-f0d2 = f1-f2 d1=2 d2=1

L = lower limit of the Modal class L = 20

f1 =Frequency corresponding to Modal class f1= 5

f0 =Frequency preceding to Modal class f0=3

f2 = Frequency succeeding to Modal class f2 = 4

i = width of the Model interval I=5
 Measures of
Dispersion –Grouped Data
Dispersion

• Commonly also called as Deviation, Variation and Spread

• They deal with average deviation from any of the measures of
central tendency
• Lesser the deviation, higher is the consistency and reliability of
Mean
• These measures help in identifying the average distance of any
observation in the dataset from the mean of the distribution

73
Measures of Central Tendency & Dispersion

Measures

Central Tendency Dispersion

(Variation)
Arithmetic Mean Range
Mathematical
Averages Interquartile Range
Weighted Mean
Variance
Median Standard Deviation
Positional
Mode Averages
Coefficient of
Variation
Some notation:

Population Sample
All items under consideration A portion of the population
by researcher selected for study

μ = population mean x = sample mean

Ν = population size n = sample size
σ = population standard s = sample standard
deviation deviation
= Population Variance =Sample Variance
Sample Variance – Grouped Frequency
Time for a problem – Grouped data

A sample is drawn to understand the number of hours

spent watching Netflix and Hotstar by the viewers in
Bangalore. Compare and give your observations using
appropriate central tendency and dispersion measures.

Hours Spent No. of No. of

on watching Netflix Hotstar
Viewers Viewers
0–4 6 8
4–8 5 5
8 - 12 6 7
12 - 16 4 2
16 - 20 4 3
The Sample Mean – Netflix Viewers
The Sample Mean – Netflix Viewers
Decision
Coefficient of Variation:

• Coefficient of variation (CV) measures the spread of a set of data as a

proportion of its mean.
• It is the ratio of the sample standard deviation to the sample mean

• Independent of units of measure

• Aids in comparison of two or more distributions
Coefficient of Variation - Example

•Netflix Viewers
Assignment

◉ Find the variance, Standard Deviation and Coefficient of Variation for Hotstar
channel using the Arithmetic Mean data given.
◉ Compare Netflix and Hotstar viewership and conclude based on the results
obtained.
◉ Complete the IBS canteen problem using Mean, Variance, standard deviation
and Coefficient of Variation.
◉ Make decisions for the canteen manager based on the values.

83
THANK YOU!!!