The following sale prices were recorded: $250,000, $260,000, $255,000, $270,000, $255,000. What is the median sale price?
Correct Answer
B) $255,000
Why this is correct: The median is the middle number in an ordered list. First, arrange the prices from lowest to highest: $250,000, $255,000, $255,000, $260,000, $270,000. With five values, the third (middle) value is $255,000. Why the other choices are wrong: "$250,000" is the minimum, not the median. "$260,000" is the fourth value. "$258,000" is the arithmetic mean (average), not the median. Exam tip: Always sort data first. For an odd count of numbers, the median is the exact middle one.
Why This Is the Correct Answer
The median is the middle value when data points are arranged in ascending order. With five sale prices ($250,000, $255,000, $255,000, $260,000, $270,000), the third value is the median. Since there are an odd number of values (5), the median is simply the middle position, which is $255,000. This represents the central tendency of the data set.
Why the Other Options Are Wrong
Memory Technique
Remember 'MEDIAN = MIDDLE' - arrange data in order, then find the exact center. For odd numbers of values, it's the middle position. For even numbers, average the two middle values.
Exam Tip
Always arrange data in ascending order first, then count to find the exact middle position for median calculations.
Common Mistakes to Avoid
- -Confusing median with mean (average)
- -Miscounting the middle position in ordered data
- -Using the data without first arranging it in order
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A comparable property sold for $425,000 but has a pool valued at $25,000 that the subject property lacks. The comparable also lacks central air conditioning valued at $8,000 that the subject has. What is the adjusted sale price?
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