Merits and Demerits of Geometric mean (GM)

Merits of GM

• It is based on all the items of the data.
• It is rigidly defined. It means different investigators will find the same result from the given set of data.
• It is a relative measure and given less importance to large items and more to small ones unlike the arithmetic mean.
• Geometric mean is useful in ratios and percentages and in determining rates of increase or decrease.
• It is capable of algebraic treatment. It mean we can find out the combined geometric mean of two or more series.

Demerits or Limitations of GM

• It is not easily understood and therefore is not widely used.
• It is difficult to compute as it involves the knowledge of ratios, roots, logs and antilog.
• It becomes indeterminate in case any value in the given series happen to be zero or negative.
• With open-end class intervals of the data, geometric mean cannot be calculated.
• Geometric mean may not correspond to any value of the given data.