# Weighted Average Formula

Average or arithmetic mean can be calculated by adding all numbers and then dividing the sum by the total number of items. This method can be applicable only when all the components are **weighted **equally. For example, one year the average of monthly water bill would be addition of all billed amounts for the 12 months and divide by twelve. This is because each bill cycle is almost same period of time that is for 1 month. If the constituent values are different we cannot use the average or arithmetic will not work and we have to use a weighted average. The weighted average can be defined as an average in which each value has a specific weight or value assigned to it and to calculate the average. A **weighted average** is mainly used when we want to calculate an average based on different percentage values or when we have values whose frequency are associated with it. Compare to average or traditional average values, weighted average is much quicker and easier. It is also useful when we deal with large data sets with hundreds or thousands of items.