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?

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Definitions:

Goods Sold

Refers to the products that a company sells to its customers, which is a critical component in calculating the revenue of the business.

T-Accounts

A visual representation in accounting, resembling the letter "T", used to depict the debit and credit transactions for a particular account.

Job-Order Costing

An accounting method that assigns costs to individual units or batches of production, based on the specific jobs or orders.

Balance Sheet

A financial statement that summarizes a company's assets, liabilities, and shareholders' equity at a specific point in time, providing a snapshot of its financial condition.