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A weighted average multiplies each data point by an arbitrary 'weight' and divides by the sum of the weights. Your everyday garden variety average, or arithmetic mean, is actually a special case of a weighted average, except all the weights are equal to 1.
Selection of weights are largely arbitrary but generally based on sound reasoning (e.g. relative population sizes). As another example, let's say you have 5 reviewers of a product giving their overall satisfaction rating. The scores are 9, 7, 6, 7, 3. However you have a very high regard for Reviewer 1 so you assign her a weight of 15 (and the others remain at weight=1).
The average score is (9+7+6+7+3)/5=6.4
The weighted average score is (15*9+7+6+7+3)/(15+4)=8.3
The weighted average is much closer to Review 1's opinion due to your weighting decision.
The weight is often NOT arbitrary as in the above example. If a bank wants to know the average interest rate for its portfolio, the weight is the principal balance of each loan. If there are only two loans, one for $999,990 at 6% and one for $10 at 12%, the AVERAGE RATE is 9% [(6 + 12)/2]. However, the weighted average rate is only 6.00006% [(((.06*999990)+(.12*10))/1000000)].
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Weighted average atomic mass?
What is weighted average atomic number
What is a flow weighted average?
A flow weighted average is found by dividing the total load over the estimation time by the total stream flow.
What is the weighted average of the following 2 2 2.5 3 3 4?
In addition to the observed values, a weighted average needs weights. No weights are given.
Definition of weighted average?
A weighted average is the average of a particular category and then weighted to whichever percentage it represents. Ex. Your course grade consists of 50% tests and 50% homework. You take two tests. You would take the average of the two tests and then weigh them against the total, which is 50%. (G1+G2)/2 x 50%
If 85 percent of a grade is 80 and the other 15 percent is 91 what is the final grade?
You have what's known as a weighted average. The 80 score is weighted more heavily than the 91 score, so the weighted average will be closer to 80 than a non-weighted average. 0.85 x 80 = 68 0.15 x 91 = 13.65 68 + 13.65 = 81.65
Weighted average atomic mass?
What is weighted average atomic number
Is The Dow Jones Industrial Average a market value weighted or price weighted index?
The Dow Jones Industrial average is a price weighted index.
What do you add to your unweighted average?
You can't convert an unweighted average into a weighted average simply by adding something. You have to do the whole calculation for the weighted average.
What is the difference between Average method vs weighted average method?
in weighted average method we assigns the weight to the averages while in average methods we dnt do this
What is the difference between average and weighted average?
weighted average is an average in which each quantity to be averaged is assigned a weight. These weightings determine the relative importance of each quantity on the average.
Why are multiples used in weighted average calculation?
The multiples are the weights (or importance) associated with each observation on which the weighted average is based.
Weighted mean sample problem?
weighted mean is getting the weighted average of students. normally, it is always use in computing the general average of the students to determine the ranking of the whole class.
What is the abbreviation for weighted average?
WAVG
Is weighted average inventory valuation GAAP?
Yes, along with FIFO and LIFO, Weighted average is a generally accepted accounting principle.
Difference between simple and weighted average?
In a simple average every value is worth the same, but in a weighted average, the frequency of each value is taken into consideration.
What is a flow weighted average?
A flow weighted average is found by dividing the total load over the estimation time by the total stream flow.
Weighted-average contribution margin?
Weighted average contribution margin is the weighted amount of contribution margin generated by all units of different mix of products to recover the total fixed cost of company.
