Altair® Panopticon

 

Weighted Mean

The weighted mean of the selection based on a specified weighting column.

It is a mean where some values contribute more than others.  

Weighted means can help with decisions where some considerations are more important than others.

The formula:

Weighted Mean =  

Σwx

Σw

In other words: multiply each weight w by its matching value x, sum that all up, and divide by the sum of weights.

Sample 1:

Sam wants to buy a new camera, and decides on the following rating system:

q  Image Quality 50%

q  Battery Life 30%

q  Zoom Range 20%

Based on reviews the Cony camera gets 8 (out of 10) for Image Quality, 6 for Battery Life and 7 for Zoom Range

The Sanon camera gets 9 for Image Quality, 4 for Battery Life and 6 for Zoom Range

Which camera is best?

Cony: (50/100) × 8 + (30/100) × 6 + (20/100) × 7 = 4 + 1.8 + 1.4 = 7.2

Sanon: (50/100) × 9 + (30/100) × 4 + (20/100) × 6 = 4.5 + 1.2 + 1.2 = 6.9

Sam decides to buy the Cony.

Sample 2:

A Company sells Mango products with the following Revenue breakdown for the current year:

Products

Revenue

Mango Tarts

45,000

Mango Juice

297,000

Dried Mangoes

975,000

Total

1,317,000

 

The revenue values per product.

The Company posted an increase in revenue from the previous year with the following Percentage Change:

Products

Revenue Percentage Change

Mango Tarts

50%

Mango Juice

10%

Dried Mangoes

30%

 

Revenue percentage change values.

Compute for the all-over revenue change percent:

((50/100) x 45,000 + (10/100) x 297,000 + (30/100) x 975,000) / 1,317,000

or

(22,500 + 29,700 + 292,500) / 1,317,000 = .26 or 26%