Average is a useful tool for making comparison of different quantities of the same category.
For example, we use averages to compute the per capita income of a country because of the there are differences in the incomes of diverse people. However, there are limitations to the use of averages. This does not show the distribution of thing between people. For an example, suppose in a country, the annual income of a fruit vendor is ₹50,000 while an MNC employee earns an annual package of ₹6,00,000. The average income of this country, therefore, will be ₹3,25,000. Both the individuals have a big difference in income but the average gives a misleading picture. The actual income or status remains unknown. One can clearly consider this as a rich country thereby ignoring the income disparity between two individuals. Averages are useful for comparison; they also hide disparities.

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