“Average” beats “median” in headline news
And that’s not a good thing for understanding numbers, says Priceonomics: Many analysts believe that the unthinking use of the average damages our understanding of quantitative information. This is because when people look at averages, they think it is “the norm”. But in reality, it might be highly impacted by just one huge outlier. Imagine an analyst who wanted to know the representative value for the cost of real estate on a block with five houses. Four of the houses are worth $100,000 and one is worth $900,000. Given these numbers, the average would be $200,000 and the median $100,000. In this case, and many others, the median gives you a better sense of what is “typical”. … The median Read More ›