The average value of an observable in a quantum system is defined as the inner product of the state and the observable applied to the state, expressed as (ψ, Aψ). When the state is an eigenstate of the observable, the average value equals the eigenvalue, not a multiple of it. For non-eigenstates, the average value can still be computed using the expansion of the state in terms of the observable's eigenfunctions. This leads to the conclusion that the average energy can be determined using the expectation value formula <H> = ∑pnEn, where pn represents the probabilities derived from the coefficients in the expansion. The discussion emphasizes the importance of understanding the relationship between states and observables in quantum mechanics.