Question

Question #ef40b

Answer 1

answer in explanation,

Explanation:

a) I'll do this quick since you seem to know it,

Mean
`= (34550+45500+75000+33000+89000+40000+55000+62500+88000+81750)/10`

Mean `=60430`

`sigma=sqrt(((-25880)^2+(-14930)^2+14570^2+(-27430)^2+28570^2+(-20430)^2+(-5430)^2+2070^2+27570^2+21320^2)/(10-1))`

`sigma=21958.081`

b)
We can assume that as we get more samples our data will approximate a normal curve with a mean of 60430 and a `sigma` of 21958.081.

In a normal distribution, 99.7% of samples fall within 3 standard deviations of the mean. with numbers outside this usually being considered outliers.

This would suggest that the highest value possible would be,
Mean`+3 *sigma`

`=60430+3*21958.081`

`=126304.243`.

This would be the highest price based on the sample.

You mentioned 2 standard deviations, so if that is what the question suggests is the highest than that would be,

`60430+2*21958.081`

`=104346.162` is the price two standard deviations out from the mean .

Hope this helped even though it is a bit late.