Likert Scale

Likert Scale Definition

Likert Scale is a 5 or 7 point scale which is used to allow individuals to express how much they agree or disagree with a particular statement. It is a set of statements offered for real or hypothetical situations under study. Individuals are asked a specific set of questions on a metric scale where they will show their level of agreement for strongly agree to Strongly Disagree. Here all the statements should be interlinked with each other so that all statements in combination should lead to a specific outcome. They shouldn’t diverge from the common dimension.

Likert Scale in Detail

  • You get framed questions with pre-judgment all leading to a common dimension.
  • It states how much people agree or disagree with a particular statement.
  • You get a range of options from where you can choose.
  • There is an option to choose “Neutral” as a response.
  • Individuals will have to choose within the specified option, so at times the real opinion of individuals is not shared.
  • If you just ask a question for a survey, then it may happen that the individual didn’t listen to your question properly and just gave an answer. So this is not reliable, so the Likert scale increases the reliability factor by asking dependent questions to the same person at the same time.
Likert Scale

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For eg:
Source: Likert Scale (wallstreetmojo.com)

Example of 5 Point Likert Scale

In this example, suppose Mr. X wants to open a Broking Firm. So for this, he wants to do a survey and see who all like to trade. Construct a questionnaire for 5 Point Likert scale survey and explain the post-survey result.

Solution:

  • The most important part of this survey is set up the right statements.
  • Each statement should lead to the common dimension of Individuals either liking or disliking trading.
  • Statements shouldn’t be off-track and they should cover the common dimension in totality.

Construction of Statements:

  1. I like the Stock Market.
  2. I like the Stocks.
  3. I like Money.
  4. I like Return.

So if you see the questions carefully you will feel that if a person says that he likes the stock market then he can’t say that he hates stocks. So just by seeing the answer to the first statement, you can predict, what will be the answers to the rest of the statements? All the statements are interconnected. So this increases the reliability factor.

The reliability factor of a survey is the factor that states how much the survey is fruitful and throwing the correct picture or not. If you see that an individual has chosen that he likes Stock marketsStock MarketsStock Market works on the basic principle of matching supply and demand through an auction process where investors are willing to pay a certain amount for an asset, and they are willing to sell off something they have at a specific price.read more but hates Stocks, then it means that the person has not read properly the statements before answering, so his answers will not be included in the final counting. So the reliability factor is increased in the likert scale survey.

Now we will have to attach options to the statements. In the 5 Point Likert Scale, we will be attaching 5 options which will have a “Neutral” option.

So the Options will be:

  1. Strongly agree
  2. Agree
  3. Neutral
  4. Disagree
  5. Strongly Disagree

Now we will have to attach numeric to each option.

Say “Strongly Agree” is 1, “Agree” is 2, “Neutral” is 3, “Disagree” is 4 and “Strongly disagree” is 5.

Numbering12345
Strongly AgreeAgreeNeutralDisagreeStrongly Disagree
I like Stock Market
I like Stocks
I like Money
I like Return
Total48121620

So from the above chart you can see that if an individual strongly agrees to all statements then the total score will be 4, because Strongly agree is Given the number “1”, so if he strongly agrees to everything, his total score will be 4, similarly if he just “Agrees’ to two statements and “Strongly Agrees” to rest two, then his total score will be (1 + 1 + 2 + 2 = 6).

Say now we have taken a survey of 120 individuals. Out of 120, you see that 20 surveys are not reliable, so you remove 20 surveys. Not reliable means that they have selected “Strongly Agree” in one statement and “Strongly Disagree” in another statement

Now out of 100 surveys if the total score is more than (12 * 100) = 1200, then it means that in general people don’t like trading in this particular market. 12 is the midpoint, it is the total score if a person chooses Neutral in all its statements.

So out of 100 Surveys, the midpoint should be (12 * 100) = 1200. If the total score of the survey is less than 1200, then Mr. X should open a trading firm as most people strongly or agreeably like trading. So we are basically clubbing opinions in order to generate a composite score and take decisions accordingly.

What is 7 Point Likert Scale and Compare it With 5 Point?

7 Point Likert scale provides more varieties of options which in turn increases the probability of meeting the objective reality of people. If a person has an opinion about liking “Stock Markets” that doesn’t fall under “Strongly agree” and “Agree”, then he is forced to choose between these two opinions, as in the 5 Point Likert Scale there are no other options.

In the 7 Point Scale, the opinions are further divided to meet the actual sentiment of the Individuals. Maybe they will add another opinion along with “Strongly Agree” and “Agree” say “Lightly Agree”.

So 7 point likert scale is the same as 5 point scale but the opinion options are more in the case of the 7 point likert scale. As a 7 point scale reveals more description of the motif and thus appeals practically to the “faculty of reason” of the participants.

Conclusion

Likert Scale is an important way by which we can objectify an opinion and take decisions accordingly. It is widely used in market research, where new markets are surveyed and analyzed for new products or business launches.

This has been a guide to what is the Likert Scale and its definition. Here we the 5 point and 7 points Likert scale along with the example. You can learn more from the following articles –

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