Question

Why do we use averages?are there any limitations to their use?explain with exanples

Answer 1

averages are used to find that roughly how much each person is earning in a country.
this can be calculated by total income divided by the total number of population. they have limitations as they hide disparities or equality between people. it also hides they distribution of money between people. if we take example and there are 5 seats and five people then average will tell that 1 person is getting one seat on an average but it is not sure that there might be one person occupying two seats and other might be in 4 seats.
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Answer 2

We use averages because they are useful for comparing differing quantities of the same category.

For example, to compute the per capita income of a country, averages have to be used because there are differences in the incomes of diverse people. However, there are limitations to the use of averages. This does not show the distribution of thing between people. For an example, suppose in a country, the annual income of a rickshaw puller is Rs 8,000 while an MNC employee earns an annual package of Rs 12,00,000. The average income of this country, therefore, will be Rs 6,05,000. Here actual income or status remains unknown. One can clearly consider this as a rich country thereby ignoring the income disparity between two individuals. Averages are useful for comparison, they also hide disparities.