EASY

1. BUSINESS ANALYTCS
TOPIC: MEAN OR AVERAGE DEVIATION
By,
SACHIN SOMANNA M.P
1ST year MBA ‘B’ Sec
V.V.C.E

2. Definition:
Average of absolute differences(differences
expressed without plus or minus sign) between
each value in a set of values, and the average
of all values of that set.
Formula :
MD = Σ│D│ or Σf│D│
N N

3. Merits of mean deviation
1. Mean deviation is rigidly defined and is easy
to understand and calculate
2. Since mean deviation is based on the
deviation about an average , it provides a
better measure for comparison about the
formation of different distribution
3. It is less affected by extreme observations.

4. Demerits
1. It is rarely used in sociological studies.
2. It cannot be computed for distributions with
open class
3. Mean deviation tends to increase with the size of
the sample though proportionately.
Uses
Mean deviation is frequently useful in computing
the distribution of personal wealth in a
community for this extremely rich as well as
extremely poor people should be taken into
consideration

5. Step for calculate MD in individual series
1. Calculate mean or median as per the
instruction given.
2. Take deviation of ‘X’ from mean (X-X ) or
median (X-M) ‘│D│’ and obtain its Σ.
3. Calculate MD

6. Step for calculate MD in discrete series
1.Calculate mean or median.
2. Take deviation from mean (X-X ) or from
median (X-M) and get the module ‘│D│’.
3. Multiply f and │D│ to get f │D│ and also
obtain its Σ
4.Calculate MD

7. Step for calculate MD in continuous series
1.Calculate mean or median
2. Take deviation from mean (X-X ) or from
median (X-M) and get the module and denote
this as module D.
3.If you are instructed to find out using mean or
median use all the step required to calculate
it.
4.Calculate MD