A neighborhood's median price rose from $240,000 to $258,000 over a year. What is the percentage change?
Correct Answer
C) 7.5 percent
Why this is correct: Percentage change = [(New Value - Old Value) / Old Value] * 100. Calculation: (258,000 - 240,000) = 18,000. (18,000 / 240,000) = 0.075. 0.075 * 100 = 7.5 percent. Why the other choices are wrong: '6.5 percent' and '9.0 percent' are not the results of the correct calculation. '18.0 percent' is the raw dollar increase expressed as a percentage of the starting value incorrectly (18,000 is 7.5% of 240,000, not 18%). Exam tip: For percentage change, always divide the difference by the original (starting) value, not the ending value.
Why This Is the Correct Answer
Why this is correct: Percentage change = [(New Value - Old Value) / Old Value] * 100. Calculation: (258,000 - 240,000) = 18,000. (18,000 / 240,000) = 0.075. 0.075 * 100 = 7.5 percent. Why the other choices are wrong: '6.5 percent' and '9.0 percent' are not the results of the correct calculation. '18.0 percent' is the raw dollar increase expressed as a percentage of the starting value incorrectly (18,000 is 7.5% of 240,000, not 18%). Exam tip: For percentage change, always divide the difference by the original (starting) value, not the ending value.
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Previous Question
An appraiser develops a multiple regression model to estimate residential sale price using GLA, age, number of bathrooms, and distance to nearest highway. The model yields an adjusted RΒ² of 0.72 and a standard error of the estimate of $24,500. Which statement best reflects the appropriate interpretation of the standard error of the estimate in this context?
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Standard deviation measures: