What is 'Mode'

The mode is a statistical term that refers to the most frequently occurring number found in a set of numbers. The mode is found by collecting and organizing data in order to count the frequency of each result. The result with the highest number of occurrences is the mode of the set.

Other popular measures of central tendency include the mean, or the average of a set; and the median, or the middle value in a set.

BREAKING DOWN 'Mode'

For example, in the following list of numbers, 16 is the mode since it appears more times than any other number in the set:
3, 3, 6, 9, 16, 16, 16, 27, 27, 37, 48

A set of numbers can have more than one mode (this is known as bimodal) if there are multiple numbers that occur with equal frequency, and more times than the others in the set.

3, 3, 3, 9, 16, 16, 16, 27, 37, 48

In this example, both the number 3 and the number 16 are modes. If no number in a set of numbers occurs more than once, that set has no mode:

3, 6, 9, 16, 27, 37, 48

Advantages and Disadvantages of the Mode

Advantages

  • It is easy to understand and simple to calculate.
  • It is not affected by extremely large or small values.
  • It can be located just by inspection in ungrouped data and discrete frequency distribution.
  • It can be useful for qualitative data.
  • It can be computed in an open-end frequency table.
  • It can be located graphically.

Disadvantages

  • It is not well defined.
  • It is not based on all the values.
  • It is stable for large values so it will not be well defined if the data consists of a small number of values.
  • It is not capable of further mathematical treatment.
  • Sometimes the data has one or more than one mode, and sometimes the data has no mode at all.
RELATED TERMS
  1. Absolute Frequency

    Absolute frequency is a statistical term describing the number ...
  2. Descriptive Statistics

    Descriptive statistics is a set of brief descriptive coefficients ...
  3. Frequency Of Exclusion

    Frequency of exclusion refers to the rate of occurrences where ...
  4. Median

    The median is the middle number in a sorted list of numbers. ...
  5. Dividend Frequency

    Dividend frequency is how often a dividend is paid by an individual ...
  6. Financial Performance

    A subjective measure of how well a firm can use assets from its ...
Related Articles
  1. Financial Advisor

    What Is Mode of Premium?

    Your decision on how frequently to make life insurance payments, or your mode of premium, can have a big impact on your total costs.
  2. Investing

    Apple Updates iOS With 'Do Not Disturb While Driving' Mode

    The mode allows Apple devices to detect when a user is driving and turn off notifications.
  3. Investing

    Tesla Updates Autopilot Software, Inches Toward Self Driving

    The software will function in active mode for 1,000 Teslas made after October 2016 and in shadow mode for its remaining fleet.
  4. Investing

    Offline Viewing Finally Comes To Netflix

    The streaming service announced that the availability of offline viewing for select titles in its library in a blog post this morning.
  5. Small Business

    Small Business Sentiment Falls to Two-Year Low

    The small business sector is "doing little more than operating in maintenance mode," the NFIB said Tuesday.
  6. Investing

    Healthcare Names Rally as Pharma Meets with Trump

    President Trump met with Pharma CEOs today at the White House and told them about his plans to streamline regulations.
  7. Trading

    Bank Stocks Are Back in Rally Mode

    The financial sector has jumped over 10% in the last month, and it's not just big bank stocks.
  8. Personal Finance

    Trapped in Financial Survival Mode? Here's How to Get Out

    Use these tips to be happy, save money and avoid living in financial survival mode.
  9. Investing

    Why the Falling VIX Is Cause for Worry

    The VIX recently fell to its lowest level since August 2015.
RELATED FAQS
  1. What is the average length of the boom and bust cycle in the U.S. economy?

    Learn more about the timing and impact of the expansion and contraction periods of the average business cycle in the U.S. ... Read Answer >>
  2. What strategies do companies employ to increase market share?

    Learn about the many strategies companies use to increase the market share of their business and ultimately their profits. Read Answer >>
  3. What is the difference between authorized shares and outstanding shares?

    Calculating financial ratios can help investors understand a company's financial position, but only when a knowledge of various ... Read Answer >>
  4. When should I use seasonally adjusted data from the consumer price index (CPI)?

    Learn what seasonally adjusted data is, how it is determined and when it should be used to evaluate the information gathered ... Read Answer >>
Hot Definitions
  1. Capital Asset Pricing Model - CAPM

    Capital Asset Pricing Model (CAPM) is a model that describes the relationship between risk and expected return and that is ...
  2. Return On Equity - ROE

    The profitability returned in direct relation to shareholders' investments is called the return on equity.
  3. Working Capital

    Working capital, also known as net working capital is a measure of a company's liquidity and operational efficiency.
  4. Bond

    A bond is a fixed income investment in which an investor loans money to an entity (corporate or governmental) that borrows ...
  5. Compound Annual Growth Rate - CAGR

    The Compound Annual Growth Rate (CAGR) is the mean annual growth rate of an investment over a specified period of time longer ...
  6. Net Present Value - NPV

    Net Present Value (NPV) is the difference between the present value of cash inflows and the present value of cash outflows ...
Trading Center