Measures of Central Tendency

Question: What is a measure of central tendency and what are the common measures of central tendency? Also, when is the median preferred over the mean?

A measure of central tendency is the single numerical value considered most typical of the values of a quantitative variable.

The most common measure of central tendency is the mode (i.e., the most frequently occurring number)

The median (i.e., the middle point or fiftieth percentile), and the mean (i.e., the arithmetic average).

The median is preferred over the mean when the numbers are highly skewed (i.e., non-normally distributed).

Measures of Central Tendency

Since, measures of central tendency condense a bunch of information into a single, digestible value that represents the center of the data, this makes measures of central tendencies important for several reasons:

  • Summarizing data: Instead of listing every data point, one can use a central tendency measure to get a quick idea of what is typical in the data set.
  • Comparisons: By computing central tendency measures for different groups or datasets, one can easily compare them to see if there are any differences.
  • Decision making: Central tendency measures can help to make wise decisions. For instance, knowing the average income in an area can help set prices. Imagine an organization is analyzing customer purchases. Knowing the average amount spent can help them tailor promotions or target specific customer groups.
  • Identifying trends: Measures of central tendencies may help in observing the trend over time. This can be done by using different visualizations to see if there are any trends, like a rise in average house prices.

However, it is very important to understand these Measures of Central Tendency (mean, median, mode). Each measure of central tendency has its strengths and weaknesses. Choosing the right measure of central tendency depends on the kind of data and what one’s interest is to extract from and try to understand.

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