Measures of Dispersion
A measure of dispersion indicates the
scattering of data. It explains the disparity of
data from one another, delivering a precise
view of their distribution.
The measure of dispersion displays and
gives us an idea about the variation and the
central value of an individual item.
In other words, dispersion is the extent to
which values in a distribution differ from the
average of the distribution. It gives us an idea
about the extent to which individual items
vary from one another, and from the central
value
Types of Measures of Dispersion
(1) Absolute measures
Absolute measures of dispersion are expressed in the
unit of variable itself, like kilograms, rupees, centimeters,
marks,
(2) Relative measures
Relative measures of dispersion are obtained as ratios or
percentages of the average.
These are also known as coefficients of dispersion.
These are pure numbers or percentages that are totally
independent of the units of observation.
Characteristics of a Good Measure of Dispersion
• It should be easy to calculate and simple to
understand.
• It should be based on all the observations of the series.
• It should be rigidly defined.
• It should not be affected by extreme values.
• It should not be unduly affected by sampling
fluctuations.
• It should be capable of further mathematical
treatment and statistical analysis.
What are the various ‘absolute measures’ of Dispersion?
(1) Range
• It is the simplest method of measurement of
dispersion.
• It is defined as the difference between the
largest and the smallest item in a given
distribution.
• Range = Largest item (L) – Smallest item (S)
2) Inter quartile Range
It is defined as the difference between the Upper
Quartile and Lower Quartile of a given distribution.
Interquartile Range = Upper Quartile (Q3)–Lower
Quartile(Q1)
(3) Quartile Deviation
It is known as Semi-Inter-Quartile Range, i.e. half of the
difference between the upper quartile and lower
quartile.
Quartile Deviation = UpperQuartile(Q3)−LowerQuartile(Q1)2
(4) Mean Deviation
Mean deviation is the arithmetic mean (average) of
deviations ⎜D⎜of observations from a central value {Mean or
Median}.
(5) Standard Deviation
Standard deviation is the Square Root of the Arithmetic Average of
the squared of the deviations measured from the mean.
(6) Lorenz Curve
The Lorenz Curve is a graphic method of measuring estimated
dispersion.
This curve is often used to measure the inequalities of income or
wealth in a society.
What Are the merits and demerits of range?
• Merits
– It is very easy to calculate and simple to understand.
– No special knowledge is needed while calculating range.
– It takes the least time for computation.
– It provides a broad picture of the data at a glance.
• Demerits
– It is a crude measure because it is only based on two extreme
values (highest and lowest).
– It cannot be calculated in the case of open-ended series.
– Range is significantly affected by fluctuations of sampling, i.e. it
varies widely from sample to sample.
Standard Deviation
A standard deviation is a statistic that measures the
dispersion of a dataset relative to its mean. The
standard deviation is calculated as the square root
of variance by determining each data point's
deviation relative to the mean.
A standard deviation (or σ) is a measure of how
dispersed the data is in relation to the mean. Low
standard deviation means data are clustered around
the mean, and high standard deviation indicates
data are more spread out.
Advantages of Standard Deviation
• Shows how much data is clustered around a
mean value.
• It gives a more accurate idea of how the data
is distributed.
• Not as affected by extreme values.
Disadvantages of Standard Deviation
• It doesn't give you the full range of the data
• It can be hard to calculate
• Only used with data where an independent
variable is plotted against the frequency of it
• Assumes a normal distribution pattern
Merits and demerits of Quartile Deviation
• Merits
– It is also quite easy to calculate and simple to understand.
– It can be used even in case of open-end distribution.
– It is less affected by extreme values so, it a superior to ‘Range’.
– It is more useful when the dispersion of the middle 50% is to be
computed.
• Demerits
– It is not based on all the observations.
– It is not capable of further algebraic treatment or statistical
analysis.
– It is affected considerably by fluctuations of sampling.
– It is not regarded as a very reliable measure of dispersion
because it ignores 50% observations.
What Are the merits and demerits of mean deviation?
• Merits
– It is based on all the observations of the series and not only on the
limits like Range and QD.
– It is simple to calculate and easy to understand.
– It is not much affected by extreme values.
– For calculating mean deviation, deviations can be taken from any
average.
• Demerits
– Ignoring + and – signs is bad from the mathematical viewpoint.
– It is not capable of further mathematical treatment.
– It is difficult to compute when the mean or median is in fraction.
– It may not be possible to use this method in case of open ended series.
What are the various ‘relative measures’ of Dispersion?
Following Are the Relative Measures of Dispersion:
(1) Coefficient of Range
– It refers to the ratio of the difference between two extreme
items of the distribution to their sum.
– Coefficient of Range =(largest item–smallest item)(largest
item+smallestitem)
(2) Coefficient of Quartile Deviation
– It refers to the ratio of the difference between Upper Quartile
and Lower Quartile of a distribution to their sum.
– Coefficient of Quartile Deviation = Q3−Q1Q3+Q1
(3) Coefficient of Mean Deviation
– Mean deviation is an absolute measure of dispersion.
– In order to transform it into a relative measure, it is divided by
the particular average, from which it has been calculated.
– It is then known as the Coefficient of Mean Deviation.
– Coefficient of Mean Deviation from Mean (X¯)=MDX¯X¯
– Coefficient of Mean Deviation from Median (ME)=MDMeMe
(4) Coefficient of Standard Deviation
– It is calculated by dividing the standard deviation (σ) by the
mean (X¯) of the data.
– Coefficient of Standard Deviation =σX
(5) Coefficient of Variation
– It is used to compare two data with respect to stability
(or uniformity or consistency or homogeneity).
– It indicates the relationship between the standard
deviation and the arithmetic mean expressed in terms
of percentage.
– Coefficient of Variation (C.V.) =σXX100
– Where, C.V. = Coefficient of Variation; σ= Standard
Deviation;
– X¯ = Arithmetic Mean
