Chapter B.2, Problem 16E

a.

To determine

To find: The mean, median and mode of the selling prices.

Explanation of Solution

Given:

The data set is:

Prices
525000
375000
425000
550000
385000
500000
550000
425000
475000
500000
350000
450000

Formula used:

The formulas are:

  $\begin{array}{l}\text{Mean =}\frac{\text{Sum of observations}}{\text{Number of observations}}\\ \text{Median =}\frac{{\left(\frac{n}{2}\right)}^{th}term+{\left(\frac{n}{2}+1\right)}^{th}term}{2}\end{array}$

Calculation:

The mean could be calculated as:

  $\begin{array}{c}\text{Mean =}\frac{\text{Sum of observations}}{\text{Number of observations}}\\ =\frac{525000+375000+\mathrm{......}+450000}{12}\\ =459166.67\end{array}$

To compute the median, arrange the data in ascending order as:

Prices
350000
375000
385000
425000
425000
450000
475000
500000
500000
525000
550000
550000

The median is:

  $\begin{array}{c}\text{Median }=\frac{{\left(\frac{12}{2}\right)}^{th}term+{\left(\frac{12}{2}+1\right)}^{th}term}{2}\\ =\frac{6^{th}term+7^{th}term}{2}\\ =\frac{450000+475000}{2}\\ =462500\end{array}$

Here, value of 4250000 is coming maximum number of times. The the mode is $ 4250000.

b.

To determine

To find: The measure of central tendency that best describes the data set.

Answer to Problem 16E

Mean.

Explanation of Solution

In this case, quantitative data has been provided and mean is the measure of the central tendency that is used when the data is in quantitative. Thus, it could be said that the mean is measure of central tendency that best describes the data set of data set.