Explore BrainMass

# Statistics: What is an outlier? Bias?

This content was COPIED from BrainMass.com - View the original, and get the already-completed solution here!

Suppose we look at real estate sales for an older neighborhood with similar houses. Suppose the prices range from \$200k to \$300k. In this case, the mean and median measures will be similar. Now suppose that a house burns down and catches the house next door on fire. Before long, someone builds a large house across the two empty lots. The value of that house might be \$750k. Now the mean will be much higher but the median will stay the same. Here is some data for practice:

Before data:
\$200, \$250, \$300
Mean = median = \$250

After data:
\$200, \$250, \$300, \$750
Mean = \$375, Median = \$275

Class,

What are the statistical definitions for:
â?¢Outlier
â?¢Bias
â?¢How do these terms apply to this example?
I look forward to your research,

© BrainMass Inc. brainmass.com October 2, 2020, 1:26 am ad1c9bdddf
https://brainmass.com/business/business-math/statistics-what-is-an-outlier-bias-382787

#### Solution Preview

An outlier is one that is far off from the rest of the data points. Clearly the \$750 home is an outlier in the neighborhood where the middle-of-the-pack home (median) and the average price (mean) were the same. Now the mean is ...

#### Solution Summary

Your response is 139 words in everyday language suitable for a novice. It explains outliers and how bias is not in play in this example.

\$2.19