The local real estate reported a sampling of house prices in

The local real estate reported a sampling of house prices in a certain area as: $56,000; $78,000; $64,000; $190,000; $60,000; $74,000; $56,000. What would be the best, most realistic house price to report, and why?

Solution

We dont no whether the distribution of house price is symmetric or not so median will be the most realistic house price to report becuase median remain unaffected by the skewness of the distribution. Following is the ordered data set:

$56,000, $56,000, $60,000, $64,000, $74,000, $78,000, $190,000

Since there are 7 data values so median will be the 4th data value of the ordered data set. So median is $64,000.