Future Business Leaders of America (FBLA) Business Calculations Practice Test

When calculating the average of a dataset, which measure would you use to find the central value?

1. mode

2. median

3. mean

4. weighted average

The correct answer is: mean

To determine the central value of a dataset, the mean is the most commonly used measure. The mean is calculated by summing all the values in a dataset and then dividing that total by the number of values. This provides a numerical average that represents a typical value within the dataset. The mean is particularly useful for datasets where values are evenly distributed and do not contain extreme outliers that could skew the average significantly. It gives a balanced view of the data points as it takes all values into account. Other measures like the mode and median have their specific uses but differ from the mean in the way they represent centrality. The mode identifies the most frequently occurring value in a dataset, which may not necessarily reflect the overall central tendency, especially in datasets with a large range of values or where multiple modes exist. The median, on the other hand, is the middle value when the data is ordered, and it effectively handles skewed data by providing a central point that is less influenced by outliers. A weighted average, while useful in certain contexts, adjusts the contributions of different data points based on specified weights and may not be applicable in every case. Thus, using the mean is an effective way to represent the central value in a wide range of datasets,