This method is otherwise known as the deviation method, or assumptive method. Under this method, a value preferably from the middle, is first assumed to be the value of the arithmetic average. Then from the assumed average, the such deviations of the different item of the series are found out. The average of such deviation are then added to the assumed average. The resultant figure comes out to be the value of the arithmetic average.
As such, under this method, the following models are to be applied to obtain the value of the arithmetic average:
d = deviation of an item from the assumed average, i.e., (X – A)
∑ Fd = sum of the products of deviations and their corresponding frequencies.
And the other factors import the same meaning cited as before.
This method is advisable, where the series is made of big and complicated values, or numbers.