How to calculate an average value

Abstract

In this video we’ll look at how to calculate an average value.

Let’s take a look.

In this worksheet we have a list of 16 properties, each with a price and other information.

Let’s calculate an average price.

First, I’llcreate a named rangefor the prices.

This makes the formulas easier to read and copy.

Excel has a function calledAVERAGE, but let’s do the calculation manually to start off with.

We know we have 16 properties, so I’ll enter “16” for the count.

I’ll use theSUM functionto calculate a total.

it’s possible for you to see that the average is about $344,000.

Now let’s calculate an average price using theAVERAGE function.

AVERAGE takes one or more arguments, which can be numbers or ranges of numbers.

In this case, I can just use the named range “prices.”

you’re free to see that the AVERAGE function gives the same number: $344,681.

What if I delete one of the prices?

It’s still dividing the total by “16”.

When I give COUNT our list of prices, it returns “15”.

Now our manually calculated averageandthe AVERAGE function return the same number.

This holds true if I enter text in place of one of the prices.

Both formulas now exclude non-numeric values from the count, so they both return the same average.

What if a price is zero?

In that case, each formula calculates an average that includes the zero price, since zero is numeric.