Absolute Measures of Dispersion: Quartile Deviation In terms of absolute measures of dispersion, quartile deviation is half of the difference between the first and third quartile, Q1 and Q3. It is based on all the observations of the series and not only on the limits like Range and QD. Characteristics of a good measure of dispersion An ideal measure of dispersion is expected to possess the following properties 1. It is then known as the Coefficient of Mean Deviation. What are the basic properties that a suitable measure of income inequality should possess? TOS Copyright. The median of a data set is the (Q2) second quartile. It should be simple to understand and easy to calculate . Coefficient of Quartile Deviation = \(\frac{_{Q3}\, -\, _{Q1}}{_{Q3}\, +\, {Q1}}\). Especially in the financial analysis of business and Medical, these measures of dispersion can prove very useful. Hence, the method of dispersion helps to find the correct variation of the data. Mean deviation is an absolute measure of dispersion. These are pure numbers or percentages totally independent of the units of measurements. 2. Characteristics of an Ideal Measure of Dispersion 7. Privacy Policy Reports of central tendency are commonly supplemented and complemented by including a measure of dispersion. It may not be possible to use this method in case of Open ended series. There are two main types of dispersion methods in statistics which are: Absolute Measure of Dispersion It should be rigidly defined 2. It should lend itself for algebraic manipulation. PreserveArticles.com is a free service that lets you to preserve your original articles for eternity. According to them, our perception of the variability of the data is one of the basic components of statistical thinking. It is not capable of further mathematical treatment. In simple terms, it shows how squeezed or scattered the variable is. But this can be avoided if we take only the absolute value of the deviations and then take their sum. 1) It should be easy to calculate and simple to follow. Surprisingly, the term statistic first came into use as late as 1817. Essential Characteristics of Dispersion “From the foregoing definitions, the essential characteristics of a measure of dispersion can be outlined as under: It consists of different methods through which variations can be measured in quantitative manner. Its value may be greatly changed if an extreme value (either lowest or highest) is withdrawn or a fresh value is added. Coefficient of Mean Deviation from Median, It is calculated by dividing the standard deviation. 4. Dispersion Meaning and Classification:. This single value helps us in making comparisons of various distributions. iv. These measures are free of the units in which the original data is measured. Measures of central tendency are based on the . Characteristics of a good measure of dispersion: An ideal measure of dispersion is expected to possess the following properties 1. Characteristics of Algebraic Measure of Dispersion • Mathematical Way • Algebraic Variables are used • Numerical Figures are used here • Formulas & Equations are used 14. Like, Kilograms, Rupees, Centimeters, Marks etc. It should not be unduly affected by sampling fluctuations. The Lorenz Curve is a graphic method of measuring estimated dispersion. It is defined as the difference between the largest and the smallest item in a given distribution. to know how much homogenous or heterogeneous the data is. It should be based on all observations in the data set.. iii. An ideal measure of dispersion is to satisfy the following characteristics. As it has been pointed out earlier, there are different measures of dispersion with their relative merits and demerits. Discuss them with examples . The main idea of the measures of dispersion is to get to know how the data are spread and how much the data points vary from the average value. Characteristics of a good Measure of Dispersion. Measures Of Dispersion: Dispersion is the extent to which values in a distribution differ from the average of the distribution. It is defined as the difference between the Upper Quartile and Lower Quartile of a given distribution. It can be used even in case of open-end distribution. By focusing on the mean, we … The variation can be measured in different numerical measures, namely: (i) Range – It is the simplest method of measurement of dispersion and defines the difference between the largest and the smallest item in a given distribution. The measure of dispersion shows the homogeneity or the heterogeneity of the distribution of the observations. But the merits and demerits common to all types of measures of dispersion are outlined as under: Merits. Before publishing your Article on this site, please read the following pages: 1. Slide 77 Measures of Dispersion There are three main measures of dispersion: – The range – The Interquartile range (IQR) – Variance / standard deviation 8. Range is significantly affected by fluctuations of sampling i.e. It is more useful when the dispersion of the middle 50% is to be computed. It should not be affected by extreme values. Hence, Dispersion is defined as the measure of scattering or variation of the items from the central value. It is a crude measure because it is only based on two extreme values (highest and lowest). The measure should be rigidly defined. 6) It should not be unduly affected by the extreme items. Common examples of measures of statistical dispersion are the variance, standard deviation, and interquartile range.. Dispersion is contrasted with location or central tendency, and together they are the most used properties of distributions. Measures of dispersion supplement the information given by the measures of central tendency: Measures of dispersion are also called averages of the ‘second order i,e., second time averaging the deviations from a measure of central tendency. Measures of location are often known as averages. 9.1 MEANING OF DISPERSION Dispersion is the extent to which values in a distribution differ from the average of the distribution. What are the characteristics, uses, advantages, and disadvantages of each of the measures of location and measures of dispersion? It should be capable of further mathematical treatment and statistical analysis. They speak of the reliability, or dependability of the average value of a series. Requirements of a good measure of Dispersion: For measure of dispersion to be classified as a good measure of dispersion, It must have the following characteristics. Their important role in statistics has been reinforced by Wild and Pfannkuch (1999). 3. It should be easy to calculate & simple to understand. It is less affected by extreme values so, it a superior to ‘Range’. These are also known as ‘Coefficient of dispersion.’. It is very easy to calculate and simple to understand. It deals with a statistical series. It cannot be calculated in the case of open-ended series. It means the average is a good representative of observation and very reliable. Following Are the Different ‘absolute Measures’ of Dispersion: Interquartile Range = Upper Quartile (Q3)–Lower Quartile(Q1). Common measures of dispersion are as follows: Range: The two endpoints between which all the values of a data set fall is called a range. It explains the disparity of data from one another, delivering a precise view of the distribution of data. Apart from a numerical value, graphics method are also applied for estimating dispersion. 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