Measures of central tendency

Central tendency refers to a central value that represents the whole statistical series. The central value is sometimes simply referred to as average. The following are the objectives of measures of central tendency.

Provides concise information: A central value presents a piece of brief and concise information about the entire data and makes it more understandable. It provides a systematic and quick view of the data set. For example, the average marks of all the students in a class are said to represent the marks of all the students and provide a view about the performance of the class.

Enables comparative studies: The measures of central tendency facilitates easy comparison between two or more data set. For example, suppose the marks of scholars of three classes are to be compared. The comparison would become much easier if the marks of each class are represented by a single value. On the other hand, a comparison of marks with the raw data would be quite a difficult task.

Facilitates formulation of policies: The average value of the various economic variables such as income, price, etc. helps in the formation of suitable economic policies. For example, if the per capita income (average income) is found to be low, then it becomes quite clear that such policies are to be formed that aim at increasing the per capita income.

Helps in establishing relationship: With the help of measures of central tendency, we can establish the relationship between two or more variables. This is because with average values it becomes easier to estimate their exact relationship. For example, the average marks of students and the average hours of their T.V. viewing can be compared. Accordingly, it can be judged whether T.V. viewing affects the performance of the students.

Also, Read Why do we Need to Study Economics?

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