Definition of a Trimmed Mean
A trimmed mean, also known as a truncated mean, is a statistical measure of central tendency calculated by removing a certain percentage of the highest and lowest values from a data set before computing the ordinary arithmetic mean. This process helps to mitigate the influence of outliers or extreme values that can significantly skew the simple mean.
How to Calculate a Trimmed Mean
To calculate a trimmed mean, first, sort the data set in ascending order. Next, determine the trim percentage (e.g., 5%, 10%). This percentage is applied to both ends of the data set: the lowest values and the highest values are removed. For instance, a 10% trimmed mean removes the bottom 10% and the top 10% of data points. Finally, calculate the arithmetic mean of the remaining data points.
A Practical Example
Consider a data set: [1, 2, 3, 4, 5, 100]. The ordinary mean is (1+2+3+4+5+100)/6 = 19.17. If we calculate a 16.7% trimmed mean (removing one value from each end), we first sort the data (already sorted). We remove '1' and '100'. The remaining data is [2, 3, 4, 5]. The trimmed mean is (2+3+4+5)/4 = 3.5. This significantly reduces the impact of the outlier '100'.
Importance and Applications
The trimmed mean is particularly useful in fields where data might be prone to measurement errors or extreme observations, such as economic indicators, survey analysis, or sports scoring (e.g., diving, gymnastics, figure skating where judges' highest and lowest scores are often dropped). It provides a more robust and representative measure of the 'typical' value compared to the simple arithmetic mean when outliers are present.