2nd Semester

| MGT1103
a.y. 2023-
2024
[Lesson 3] Numerical Data

Measures of central location

 How numerical data tend to cluster around some middle or
central value.
 Attempt to find a typical or central value that describes the data.

ARITHMETIC MEAN
 Primary measure of central location.
 Mean or average.
 Add up all the observations and divide by the number of
observations.

Population Mean Sample Mean

v Denoted as x̄ ; a statistic
v Denoted as μ ; a describing a sample.
parameter describing a v N observations in the
population. population: x 1 , x 2 ,… x n
v N observations in the
population: v x̄=
∑ xi
x 1 , x 2 ,… x N N
v Can be misleading in the
v μ=
∑ x1 presence of extremely small
N or large observations, or
outliers.

MEDIAN
 Middle value of a variable.
 Divides the data in half.
 An equal number of observations lie above and below the
median.
o The middle value if n (or N) is odd.
o The average of the two middle values if n (or N) is even.
 Useful when outliers are present.

NOTE!
P Mean and median are both typically published.
P If they differ, then the variable likely contains outliers.

Mode
 Observation that occurs most frequently.
o One mode: Unimodal
o Two modes: Bimodal
 Less useful measure of centrality when there are more than three
modes.

NOTE!
P Just because an observation occurs with the most frequency does
not guarantee that it best reflects the center of the variable.

Descriptive
Excel R
Measure
Location
Mean =AVERAGE()
Median =MEDIAN()
Mode =MODE()
Minimum =MIN()
Maximum =MAX()
Percentile =PERCENTILE.INC()
Multiple Measures NA
Dispersion
Range =MAX() – MIN()
Mean Absolute
=AVEDEV()
Deviation
Sample Variance =VAR.S()
Sample Standard
=STDEV.S()
Deviation
Shape
Skewness
Kurtosis
Association
Sample Covariance
Correlation

San Luis, Jersey Anne | 1