hi REMA
Welcome to the forum.
This is called a weighted average. By applying a 'weight' to each type of medal you can take account of it being 'better' to get a higher weighted medal.
So if you wanted to 'score' countries in the Olympics, for example, your system of G = 3, S = 2 and B = 1 would make more sense.
But the purpose is to get the average placement where 1st is best and then 2nd and then 3rd. So you want the 'value' of gold to be 1.
Take an extreme example. If a player got only golds, say 20, then the calculation would be (20 x 1)/20 = 1, so the average placement would be 1, ie. the best.
If the player got 19 golds and 1 silver the calculation would be (19 x 1 + 1 x 2)/20 = 21/20 = 1.05 so the average placement has dropped a bit.
But you do need to be told the weightings.
And the system has a serious flaw. If a player gets 1 gold and 19 below bronzes the average is (1 x1 + 10 x 0)/20= 0.05 which is even better than the 20 gold player. Hhmmmm!
So you are right to be confused. So am I. 
Bob