In: Economics
Q3 [1 point]: What is the purpose of a dendrogram and what are the drawbacks of trying to use one?
Q3) A dendogram is a tree like structure where several branches are attached with a root node. It is a visual representation. The branches represent categories and the diagram implies a hierarchical relationship among these categories. The members of these categories share a number of common characteristics or they are similar in fashion. Categories are also called as clusters and the process of entering items in a specfic cluster is known as clustering. Therefore, the aim of a dendogram is to show this hierarchical relationship by placing them into a number of smaller clusters. In short we can say that it works out in the best way to allocate items to clusters.
Drawbacks of using a dendogram are following:
a) Although it can be easily done and can be understood easily but it does not provide best solution very often.
b) This method of clustering involves a lot of arbitrary dicisions.
c) It does not deal with data in which values are missing.
d) It poorly works on the data set which are mixed. It does not work well on the data set which are very large. Further it is misinterpreted.