Housing Costs a Government Report on Housing Costs Says That

question 41

Essay

Housing costs A government report on housing costs says that single-family home prices
nationwide are skewed to the right, with a mean of $235,700. We want to see how home
prices in Orange County, California compare with those nationwide.
a. We collect price data from a random sample of 50 homes in Orange County, California.
Why is it okay to use these data for inference even though the population is skewed?
b. The standard deviation of the 50 homes in our sample was $25,500. Specify the sampling
model for the mean price of such samples.
c. This sample of randomly chosen homes produced a 90% confidence interval for the
mean price in Orange County of ($233954, $246046). Does this interval provide evidence
that single-family home prices are unusually high in this county? Explain briefly.
d. Suppose we want to collect a new sample. How many homes must we survey to have
90% confidence of estimating the mean local price to within $2000?

---

Definitions:

Professional Groups

Associations or organizations that represent the interests and standards of professionals in a specific industry or field.

Significance Level

The threshold below which a p-value is considered to indicate a statistically significant difference from a hypothesized value.

Grade Point Average

A numerical calculation representing the average value of the accumulated final grades earned in courses over time, scaled usually from 0.0 to 4.0.

Fourth-Year Medical

Relating to the final year of medical school, where students typically focus on specialized clinical training and prepare for residency.