CBSE Class 11 Economics Full Study Material Set A

UNIT – 3

STATISTICAL TOOLS AND INTERPRETATION :-

1. Measures of central Tendency.

2. Measures of Dispersion

3. Co-relation and Measures of correlation

4. Introduction to Index Numbers.

Measures of Central Tendency

(Important Terms & Concepts) :-

1. Average or measures of central Tendency :- It is a value which is a typical or representative of a set of data. Averages are also called measures of central tendency, since they tend to lie centrally, with in a set of data arranged according to magnitude.

2. Functions of Average :- Average helps to get a representative value to the entire set of data.

a). It Facilitates Comparison.

b). It is a useful tool in decision- making.

3. Essentials of a Good Average / good measures of Central Tendency : -

a). Simplicity in calculation

b). Easy to understand

c). Rigidly Defined

d). Precise Value

e). Based upon all observations

f). Unaffected by extreme values.

g). Capable for further statistical calculations.

4. Types of Averages / measures of central Tendency :- There are three averages, which are in common use- Arithmetic Mean, Median and Mode.

8. Merits of Arithmetic Mean:-

(i) It is easy to calculate and simple to understand.

(ii) It is rigidly defined.

(iii) It is a calculated value not a positional value. 

(iv) It is based on all observations.

12. Merits of median :-

• It is easy to understand and easy to compute.

• It is not unduly affected by extreme observations

• Median can be located graphically with the help of ogives.

• It is the most appropriate average in case of open-ended classes.

• It is the most suitable average for qualitative measurement such as intelligence, beauty etc.

• It is a positional value and not a calculated value.

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