What is the mode and when is it a suitable average to use? State its disadvantages.

Answer Details

The mode is the value that occurs most frequently in a set of data. In a grouped frequency distribution it is the value corresponding to the class with the highest frequency (the modal class). Unlike the mean, it is not calculated from every value but identified as the most common observation.

When the mode is a suitable average to use:

• When the most typical or most popular item is needed, for example the most common shoe size a trader should stock or the most frequently demanded commodity.
• When the data are qualitative or in categories that cannot be added, such as the most popular brand.
• When a quick, simple measure of the typical value is required.
• When the distribution has extreme values that would distort the mean, since the mode is unaffected by them.

Disadvantages of the mode:

• It ignores all values except the most frequent one, so it does not use all the data.
• A distribution may have no mode, or two or more modes (bimodal or multimodal), making interpretation difficult.
• It is not suitable for further mathematical or statistical treatment.
• It can be unrepresentative when the most frequent value lies far from the centre of the data.
• For grouped data its value depends on how the classes are formed.