The following data represent the asking price of a simple random sample of homes
ID: 3362419 • Letter: T
Question
The following data represent the asking price of a simple random sample of homes for sale. Construct a 99%
confidence interval with and without the outlier included. Comment on the effect the outlier has on the confidence interval.
$216,900 $279,900 $219,900
$143,000 $205,800 $177,000
$459,900 $175,000 $187,500
$298,500 $147,800 $264,900
(a) Construct a 99% confidence interval with the outlier included. ($___, $____)
B) Construct a 99% confidence interval with the outlier removed: ($_____ , $ _____)
C) Comment on the effect the outlier has on the confidence interval:
a) The outlier caused the width of the confidence interval to increase.
b) The outlier caused the width of the confidence interval to decrease.
c) The outlier had no effect on the width of the confidence interval.
The following data represent the asking price of a simple random sample of homes for sale. Construct a 99%
confidence interval with and without the outlier included. Comment on the effect the outlier has on the confidence interval.
$216,900 $279,900 $219,900
$143,000 $205,800 $177,000
$459,900 $175,000 $187,500
$298,500 $147,800 $264,900
(a) Construct a 99% confidence interval with the outlier included. ($___, $____)
B) Construct a 99% confidence interval with the outlier removed: ($_____ , $ _____)
C) Comment on the effect the outlier has on the confidence interval:
a) The outlier caused the width of the confidence interval to increase.
b) The outlier caused the width of the confidence interval to decrease.
c) The outlier had no effect on the width of the confidence interval.
Explanation / Answer
The outlier is 459900
a)
99% Confidence Interval with outliers: 230750 ± 65000
(165750 to 295750)
b)
99% Confidence Interval without outlier: 210000 ± 40000
(170000 to 250000)
c)
a) The outlier caused the width of the confidence interval to increase.
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