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Module 6 Measures of Central Tendency

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616 views7 pages

Module 6 Measures of Central Tendency

accounting
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© © All Rights Reserved
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Statistics

MODULE 6: Measures of Central Tendency

LEARNING OUTCOMES

At the end of the module, you are expected to exhibit the following competencies:
1. Recognise the concepts of measures of central tendency.
2. Provide a sound interpretation of measures of central tendency.
3. Calculate commonly used measures of central tendency.

IMPORTANT CONCEPTS

Common Measures of Central Tendency: Mean, Median and Mode

Presented below is a frequency distribution table of the monthly income of 35 families residing in a nearby
barangay/village.

Monthly Family Income in Number of Families


Pesos
12,000 2
20,000 3
24,000 4
25,000 8
32,250 9
36,000 5
40,000 2
60,000 2

 Highest monthly family income is 60,000 pesos while the lowest is 12,000 pesos. The highest and lowest
values, which are commonly known as maximum and minimum, respectively are summary measures of a
data set. They represent important location values in the distribution of the data. However, these measures
do not give a measure of location in the center of the distribution

 Monthly family income that is most frequent is 32,250 pesos. The value of 32,250 occurs most often or it is
the value with the highest frequency. This is called the modal value or simply the mode. In this data set, the
value of 32,250 is found in the center of the distribution.

 If you list down individually the values of the monthly family income from lowest to highest, what is the
monthly family income where half of the total number of families have monthly family income less than or
equal to that value while the other half have monthly family income greater than that value?

When arranged in increasing order or the data come in an array as in the following:
12,000; 12,000; 20,000; 20,000; 20,000; 24,000; 24,000; 24,000; 24,000; 25,000; 25,000;25,000; 25,000;
25,000; 25,000; 25,000; 25,000; 32,250; 32,250; 32,250; 32,250; 32,250; 32,250; 32,250; 32,250; 32,250;
36,000; 36,000; 36,000; 36,000; 36,000; 40,000; 40,000; 60,000; 60,000;

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Measures of Central Tendency
There are 17 values that are less than the middle value while another 17 values are higher or equal to the
middle value. That middle value is the 18th observation and it is equal to 32,250 pesos. The middle value is
called the median and is found in the center of the distribution.

 When computed using the data values, the average is 30,007.14 pesos. The average monthly family income is
commonly referred to as the arithmetic mean or simply the mean which is computed by adding all the values
and then the sum is divided by the number of values included in the sum. The average value is also found
somewhere in the center of the distribution.

Mean, Median and Mode

The most widely used measure of the center is the (arithmetic) mean. It is computed as the sum of all
observations in the data set divided by the number of observations that you include in the sum. If we use the
N
summation symbol∑ Xi, read as ‘sum of observations represented by Xi where i takes the values from1 to N,
i=1
and N refers to the total number of observations being added’, we could compute the mean (usually denoted by
N

Greek letter, µ) as µ =
∑ Xi . Using the example earlier with 35 observations of family income, the mean is
i=1
N
computed as
µ = (12,000 + 12,000 + ⋯ + 60,000) / 35 = 1,050,250 / 35 = 30,007.14

Alternatively, we could do the computation as follows:

For large number of observations, it is advisable to use a computing tool like a calculator or a computer software,
e.g. spreadsheet application or Microsoft Excel®.

The median on the other hand is the middle value in an array of observations. To determine the median of a data
set, the observations must first be arranged in increasing or decreasing order. Then locate the middle value so
that half of the observations are less than or equal to that value while the half of the observations are greater
than the middle value.

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Measures of Central Tendency

N + 1 th
If N (total number of observations in a data set) is odd, the median or the middle value is the ( )
2
observation in the array On the other hand, if N is even, then the median or the middle value is the average of
N th N
the two middle values or it is average of the ( ) and ( +1)th observations. In the example given earlier, there
2 2
N + 1 th = 36 th
are 35 observations so N is 35, an odd number. The median is then the ( ) ( ) = = 18th observation in
2 2
the array. Locating the 18th observation in the array leads us to the value equal to 32,250 pesos.

The mode or the modal value is the value that occurs most often or it is that value that has the highest frequency.
In other words, the mode is the most fashionable value in the data set. Like in the example above, the value of
32,250 pesos occurs most often or it is the value with the highest frequency which is equal to nine.

Properties of the Mean, Median and Mode

Each of these three measures has its own properties. Most of the time we use these properties as basis for
determining what measure to use to represent the center of the distribution.

As mentioned before the mean is the most commonly used measure of central tendency since it could be likened
to a “center of gravity” since if the values in an array were to be put on a beam balance, the mean acts as the
balancing point where smaller observations will “balance” the larger ones as seen in the following illustration.

Note that the frequency represented by the size of the rectangle serves as ‘weights’ in this beam balance.

To illustrate further this property, we could ask the student to subtract the value of the mean to each observation
(denoted as di) and then sum all the differences. The computation can also be done alternatively as shown in the
following table.

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Measures of Central Tendency

The sum of the differences across all observations will be equal to zero. This indicate that the mean indeed is the
center of the distribution since the negative and positive deviations cancel out and the sum is equal to zero.

In the expression given above, we could see that each observation has a contribution to the value of the mean.
All the data contribute equally in its calculation. That is, the “weight” of each of the data items in the array is the
1
reciprocal of the total number of observations in the data set, i.e. .
N

Means are also amenable to further computation, that is, you can combine subgroup means to come up with the
mean for all observations. For example, if there are 3 groups with means equal to 10, 5 and 7 computed from 5,
15, and 10 observations respectively, one can compute the mean for all 30 observations as follows:

(N 1 µ 1+ N 2 µ2+ N 3 µ 3) (10 x 5)+(5 x 15)+(7 x 10)


µ= = = 195/30 = 6.59
30 30

If there are extreme large values, the mean will tend to be ‘pulled upward’, while if there are extreme small
values, the mean will tend to be ‘pulled downward’. The extreme low or high values are referred to as ‘outliers’.
Thus, outliers do affect the value of the mean.

To illustrate this property, we could tell the students that if in case there is one family with very high income of
600,000 pesos monthly instead of 60,000 pesos only, the computed value of mean will be pulled upward, that is,

(12,000+12,000+−…+600,000)
µ= = 2,130,250/35 = 60,864.29
35

Thus, in the presence of extreme values or outliers, the mean is not a good measure of the center. An alternative
measure is the median. The mean is also computed only for quantitative variables that are measured at least in
the interval scale.

Like the mean, the median is computed for quantitative variables. But the median can be computed for variables
measured in at least in the ordinal scale. Another property of the median is that it is not easily affected by
extreme values or outliers. As in the example above with 600,000 family monthly income measured in pesos as
extreme value, the median remains to same which is equal to 32,250 pesos.

For variables in the ordinal, the median should be used in determining the center of the distribution. On the other
hand, the mode is usually computed for the data set which are mainly measured in the nominal scale of
measurement. It is also sometimes referred to as the nominal average. In a given data set, the mode can easily be
picked out by ocular inspection, especially if the data are not too many. In some data sets, the mode may not be
unique. The data set is said to be unimodal if there is a unique mode, bimodal if there are two modes, and

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Measures of Central Tendency
multimodal if there are more than two modes. For continuous data, the mode is not very useful since here,
measurements (to the most precise significant digit) would theoretically occur only once.

The mode is a more helpful measure for discrete and qualitative data with numeric codes than for other types of
data. In fact, in the case of qualitative data with numeric codes, the mean and median are not meaningful.

The following diagram provides a guide in choosing the most appropriate measure of central tendency to use in
order to pinpoint or locate the center or the middle of the distribution of the data set. Such measure, being the
center of the distribution ‘typically’ represents the data set as a whole. Thus, it is very crucial to use the
appropriate measure of central tendency.

PRACTICE SKILLS

1. Thirty people were asked the question, “How many people do you consider your best friend?” The graph
below shows their responses.

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Measures of Central Tendency

What measure of central tendency would you use to find the center for the number of best friends people
have? Explain your answer.

2. The mean age of 10 full time guidance counselors is 35 years old. Two new full time guidance counselors,
aged 28 and 30, are hired. Five years from now, what would be the average age of these twelve guidance
counselors?

3. Houses in a certain area in a big city have a mean price of PhP4,000,000 but a median price is only
PhP2,500,000. How might you explain this best?

4. Five persons were asked on the usual number of hours they spent watching television in a week. Their
responses are: 5, 7, 3, 38, and 7 hours.

a. Obtain the mean, median and mode.


b. If another person were to be asked the same question and he/she responded 200 hours, how
would this affect the mean, median and mode?

5. For the senior high school dance, there is a debate going on among students regarding the color that will be
featured prominently. Votes were sent by students via SMS, and the results are as follows:

Color Red Green Orange White Yellow Blue Brown Purple


No. of
Votes 300 550 70 130 220 710 35 5
Received

a. Is there a clear winner on the choice of color?


b. Compute for the mean, median and modal color (if possible).
c. Why is it that we could or could not find each measure of the central tendency?
d. Which measure of central tendency will determine the color to be prominently used during the senior high
school dance?

6. Everyone studied very hard for the quiz in the Statistics and Probability Course. There were 10 questions in
the quiz, and the scores are distributed as follows:

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Measures of Central Tendency

Score Number of Students


10 8
9 12
8 6
7 5
6 3
5 2
4 0
3 1
2 1
1 0
0 2

a. Compute for the mean, median, and mode for this set of data.
b. Suppose the teacher said “Everyone in the class will be getting either the mean, median, or mode for their
official score.”
1. What would students want to receive (mean, median, or mode)?
2. Which would students want to receive the least (mean, median or mode)?
3. What is the fairest score to receive would be? Ask students to explain their answers.

REFERENCES

Albert, J. R. G. (2008). Basic Statistics for the Tertiary Level (ed. Roberto Padua, WelfredoPatungan, Nelia
Marquez), published by Rex Bookstore.

“Deciding Which Measure of Center to Use” http://www.sharemylesson.com/teaching-resource/deciding-which-


measure-ofcenter-to-use-50013703/

Handbook of Statistics 1 (1st and 2nd Edition), Authored by the Faculty of the Institute of Statistics, UP Los Baños,
College Laguna 4031

Workbooks in Statistics 1 (From 1st to 13th Edition), Authored by the Faculty of the Institute of Statistics, UP Los
Baños, College Laguna 4031

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