Measures of Central Tendency — Economics STD 11 Commerce — Question

Averages occupy a prime place in the theory of statistical methods. That is why Bowley remarked, "Statistics is a science of averages." The following are the m objectives of an average:

1. Facilitates Comparison: The foremost purpose of average is that it facilitates comparison. For instance, a comparison of the production of jute in Maharashtra a Punjab shows that production of jute in Maharashtra is much more as compared Punjab.
2. Formulation of Policies: Averages are of great use in the formulation of various policy measures. For instance, when the Government finds that there is a fear of low product of sugar, it can formulate various policies to compensate the same.
3. Short Description: Averages help to present the raw data in a brief a systematic manner.
4. Representation of Universe: Average represents universe. According conclusions can be drawn in respect of the universe as a whole.
5. To represent huge mass of data in a summarized manner: It is difficult for a human being to grasp a large mass of data in mind bt an average summarizes such mass data into a single figure which is easier to understand and remember. N one can remember income of all Indians but it is an easy task to remember per capita income of India.