Properties and limitations of geometric mean?

Answer 1

In a given sequence, there are two possible means calculatable: Arithmetic Mean, and Geometric Mean. The arithmetic mean, as we all know, is calculated from the sum of all the numbers divided by how many numbers there are: Sumn/n. The Geometric sum is calculated by multiplying all the numbers within the sequence together and taking the nth root of this value: (Productn)(1/n).

In a geometric series, N(i)= a(ri), the geometric mean is found to be a(rn-1), where n is the number of elements within the series. this decreases or increases exponentially depending on the r value. If r<1 , then decreasing, r=1, remains constant, r>1, increasing.

Limitation Of Geometric Mean are:-

1) Geometric mean cannot be computed when there are both negative and positive values in a series or more observations are having zero value.

2)Compared to Arithmetic Mean this average is more difficult to compute and interpret.

-Iwin