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Get Full Access to Statistics: Informed Decisions Using Data - 5 Edition - Chapter 15.3 - Problem 10
Get Full Access to Statistics: Informed Decisions Using Data - 5 Edition - Chapter 15.3 - Problem 10

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# ?Housing Prices on Zillow Zillow.com allows people to research real estate listings. One feature is the “Zestimate,” which represents the price Zillow ISBN: 9780134133539 240

## Solution for problem 10 Chapter 15.3

Statistics: Informed Decisions Using Data | 5th Edition

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Problem 10

Housing Prices on Zillow Zillow.com allows people to research real estate listings. One feature is the “Zestimate,” which represents the price Zillow believes the property should sell for. If the Zestimate is accurate, the median difference between the actual selling price and the Zestimate should be zero. The following data represent the difference between the  actual selling price and Zestimate for a random sample of 10 real estate transactions. Do the data suggest the Zestimate is inaccurate? Use the = 0.05 level of significance. Note: A normal probability plot indicates the data are not normal. Step-by-Step Solution:

Step 1 of 5) Housing Prices on Zillow Zillow.com allows people to research real estate listings. One feature is the “Zestimate,” which represents the price Zillow believes the property should sell for. If the Zestimate is accurate, the median difference between the actual selling price and the Zestimate should be zero. The following data represent the difference between the actual selling price and Zestimate for a random sample of 10 real estate transactions. Do the data suggest the Zestimate is inaccurate Use the = 0.05 level of significance. Note: A normal probability plot indicates the data are not normal. However, for skewed distributions, it is often difficult to determine which measure of center is more useful. In some cases, the mean, though not resistant, is easier to find than the median or is more intuitive to the reader within the context of the problem. Here we look at the sampling distributions of the mean and median for two different populations, one normal (symmetric) and one exponential (skewed).

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