Formula to Calculate Average

You are free to use this image on you website, templates, etc., Please provide us with an attribution linkHow to Provide Attribution?Article Link to be HyperlinkedFor eg:Source: Average Formula (wallstreetmojo.com)

  • where ai = ith observationn = Number of observations

Explanation

Examples

Example #1

Let us take an example of John, who enrolled in the graduation program for environmental science. The three-year degree course is divided into six semesters, and the final average percentage is calculated based on the percentages scored in all the semesters. Calculate John’s final percentage based on his following score:

  • Firstly, determine the observation, and they are denoted by a1, a2, ….., an corresponding to 1st observation, 2nd observation,…., nth observation. Next, determine the number of observations, and it is denoted by n. Finally, the average is calculated by adding all the observations and then divide the result by the number of observations, as shown below. Average = (a1 + a2 + …. + an) / n

Average = (a1 + a2 + …. + an) / n

Below is given data for calculation of the average percentage.

Given,

a1 = 79%, a2 = 81%, a3 = 74%, a4 = 70%, a5 = 82%, a6 = 85%, n = 6

Using the above information, the calculation of average will be as follows,

  • Average = (79% + 81% + 74% + 70% +82% + 85%) / 6

Average will be –

  • Average = 78.50%

Therefore, David scored a final percentage of 78.5% in the graduation program.

Uses

As the name “average” suggests, it refers to the central point among a set of observations. When it is utilized in mathematics, it represents the number which is typically the meaning of a group of numbers. The term is often used to express a number, which represents a group of people or things. It is very important because it helps in summarizing a large number of data into a single value, and it also indicates that there is some inconsistency around the single value within the original data, which forms a very crucial part of the central tendency theory.

This has been a guide to Average Formula. Here we discuss how to calculate the average using its formula and examples and a downloadable excel template. You can learn more about financing from the following articles –

  • Moving Average FormulaMoving Average FormulaMoving Average (MA), commonly used in capital markets, can be defined as a succession of mean that is derived from a successive period of numbers or values and the same would be calculated continually as the new data is available. This can be lagging or trend-following indicator as this would be based on previous numbers.read moreMeasures of Central TendencyMeasures Of Central TendencyCentral Tendency is a statistical measure that displays the centre point of the entire Data Distribution & you can find it using 3 different measures, i.e., Mean, Median, & Mode.read moreAverage vs Weighted AverageAverage Vs Weighted AverageIn Excel, the words average and weighted average are different. Average is a method for calculating the central point of a given data set, and it is done using the traditional method of adding the numbers and dividing the sum by the number of data sets present. A weighted average, on the other hand, is an average calculated in the same way but with a weight multiplied with each data set.read moreAVERAGE Function in ExcelAVERAGE Function In ExcelThe AVERAGE function in Excel gives the arithmetic mean of the supplied set of numeric values. This formula is categorized as a Statistical Function. The average formula is =AVERAGE(read moreEffect SizeEffect SizeEffect size measures the intensity of the relationship between two sets of variables or groups. It is calculated by dividing the difference between the means pertaining to two groups by standard deviation. It is a statistics concept.read more