Median
Median is the middle value of an ordered dataset, splitting it into two equal halves. Unlike the mean, it is resistant to extreme values, making it a better measure of centre for skewed distributions.
See it move
Five house prices — €180,000, €200,000, €210,000, €225,000 and €850,000 — produce a mean of €333,000, dragged upward by the single luxury property. Ordering the same five values and taking the middle one gives a median of €210,000, a far more representative figure for the typical home, since the median depends only on position, not the size of extreme values.
The formula
Variables
- Number of observations in the ordered dataset
For odd n this gives the exact middle position. For even n, average the values at positions n/2 and (n/2) + 1.
Check yourself
A property researcher collects sale prices for eight transactions in a city district: €192,000, €205,000, €218,000, €230,000, €245,000, €260,000, €275,000, and €1,940,000. She wants to describe the price a typical buyer would pay. Why is the median a better summary than the mean in this case?