Three separate pairs indicate contributions of $12,000, $14,000 and $13,000 for a finished basement. What single adjustment is best supported?
Correct Answer
D) $13,000
Why this is correct: with three pairs pointing at a narrow range, the central tendency of the three is the best-supported figure. Calculation: ($12,000 + $14,000 + $13,000) ÷ 3 = $13,000. Why the other choices are wrong: $12,000 and $14,000 each discard two of the three observations in favor of whichever one is most or least generous; $39,000 sums three measurements of the same feature, as though the basement were finished three times.
Why This Is the Correct Answer
Why this is correct: with three pairs pointing at a narrow range, the central tendency of the three is the best-supported figure. Calculation: ($12,000 + $14,000 + $13,000) ÷ 3 = $13,000. Why the other choices are wrong: $12,000 and $14,000 each discard two of the three observations in favor of whichever one is most or least generous; $39,000 sums three measurements of the same feature, as though the basement were finished three times.
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In paired sales analysis, two similar properties sold within one month of each other. Property A (2,000 sq ft) sold for $400,000, and Property B (2,200 sq ft) sold for $440,000. What is the indicated adjustment per square foot?