Pregunta
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9. Justify Conclusions A real-estate guide lists the average home prices for countie in your state. Do you think the mean, median, or mode would be the most useful average for homebuyers? Explain.

Ask by Warner Tran. in the United States
Mar 04,2025

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The median is the best average for homebuyers because it shows the middle price, giving a better idea of what most homes cost, unlike the mean which can be skewed by very expensive homes.

Solución

The median is likely the most useful average for homebuyers. Here’s why: • Many housing markets have a skewed distribution of prices because a small number of very expensive homes can pull the mean (average) upward. This can give the impression that homes are more expensive overall than they really are for most buyers. • The median shows the middle value when all home prices are arranged in order. This means that 50% of the homes are priced below this value and 50% are priced above it, providing a better sense of what a “typical” home might cost. • While the mode (the most frequently occurring price) can sometimes be informative, it is less useful when the prices vary widely or when there isn’t a single price point that occurs much more frequently than others. Therefore, for practical purposes and to avoid the distortion that extreme high-value properties can cause, the median offers a more accurate reflection of the home price market for buyers.

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The Deep Dive

When it comes to home prices, the median is often the most useful average for homebuyers. This is because the median price reflects the middle point of a dataset, which means it is less affected by extreme values or outliers—like a multi-million dollar mansion skewing the average. By focusing on the median, buyers get a clearer picture of what a typical home actually costs in their desired area. On the other hand, the mode, which indicates the most frequently occurring price, could also have its place. However, if the mode is a price that doesn’t fit the majority of homes on the market, it might not be very illustrative. For instance, if a lot of homes are priced around $300,000 but a small number are clustered at $450,000, the mode might mislead buyers.

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