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House prices: The mean and median selling prices of existing single-family homes sold in November 2009 were \(216,400 and \)172,600. Which of these numbers is the mean and which is the median? Explain how you know.

Short Answer

Expert verified

Mean=$216,400Median:$172600

Step by step solution

01

Given Information

The mean and median selling prices of existing single-family homes sold in November2009 were $216,400 and $172,600

02

Concept

The total of all observations divided by the number of observations is the observation mean. The median of a distribution organised in ascending order is the midway.

03

Calculation

Existing single-family homes sold for $216,400 and $172,600, respectively.

The majority of residences will sell for around the same amount, while others will sell for significantly more.

As a result, the selling price distribution will be right-skewed.

We know that the mean is bigger than the median in a right-skewed distribution because the mean is influenced by extremely high incomes while the median is not:

x=$216,400MEDIAN=$172,600

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