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Concept explainers
Data obtained from a county auditor in the Excel file Home Market Value provide information about the age, square footage, and current market value of houses along one street in a particular subdivision. Considering these data as a population of homeowners on this street, compute the mean, variance, and standard deviation for each of these variables using a spreadsheet and formulas (4.1), (4.4), and (4.6). Verify your calculations using the appropriate Excel
![Check Mark](/static/check-mark.png)
To find population mean, variance and standard deviation and verify it using excel function for each of the variables.
Explanation of Solution
Given:
Data,
House Age | Square Feet | Market Value |
33 | 1,812 | $90,000.00 |
32 | 1,914 | $104,400.00 |
32 | 1,842 | $93,300.00 |
33 | 1,812 | $91,000.00 |
32 | 1,836 | $101,900.00 |
33 | 2,028 | $108,500.00 |
32 | 1,732 | $87,600.00 |
33 | 1,850 | $96,000.00 |
32 | 1,791 | $89,200.00 |
33 | 1,666 | $88,400.00 |
32 | 1,852 | $100,800.00 |
32 | 1,620 | $96,700.00 |
32 | 1,692 | $87,500.00 |
32 | 2,372 | $114,000.00 |
32 | 2,372 | $113,200.00 |
33 | 1,666 | $87,500.00 |
32 | 2,123 | $116,100.00 |
32 | 1,620 | $94,700.00 |
32 | 1,731 | $86,400.00 |
32 | 1,666 | $87,100.00 |
28 | 1,520 | $83,400.00 |
27 | 1,484 | $79,800.00 |
28 | 1,588 | $81,500.00 |
28 | 1,598 | $87,100.00 |
28 | 1,484 | $82,600.00 |
28 | 1,484 | $78,800.00 |
28 | 1,520 | $87,600.00 |
27 | 1,701 | $94,200.00 |
28 | 1,484 | $82,000.00 |
28 | 1,468 | $88,100.00 |
28 | 1,520 | $88,100.00 |
27 | 1,520 | $88,600.00 |
27 | 1,484 | $76,600.00 |
28 | 1,520 | $84,400.00 |
27 | 1,668 | $90,900.00 |
28 | 1,588 | $81,000.00 |
28 | 1,784 | $91,300.00 |
27 | 1,484 | $81,300.00 |
27 | 1,520 | $100,700.00 |
28 | 1,520 | $87,200.00 |
27 | 1,684 | $96,700.00 |
27 | 1,581 | $120,700.00 |
Formula:
Population mean:
Population variance:
Population standard deviation:
Calculation:
For each of the variable, need to find population mean, variance and standard deviation.
Variable House Age:
Total number of values = N=42
Mean =
Using excel function: =AVERAGE(A2:A43)
Mean = 29.83 which is exactly matched with calculated mean.
Population variance:
Population standard deviation:
Using excel formula:
=VAR.P(A2:A43)
Variance = 5.76
=STDEV.P(A2:A43)
Standard deviation = 2.40
Both the values almost match with calculated value.
Variable square feet:
Mean =
Using excel: =AVERAGE(B2:B43)
Mean = 1695.26 which is almost match with calculated value.
Population variance:
Population standard deviation:
Using excel:
Population variance: =VAR.P(B2:B43) which gives 47357.96
Population standard deviation found by excel is matched with calculated variance.
Standard deviation: =STDEV.P(B2:B43) which gives 217.62
Standard deviation is also matched with calculated value.
Variable Market value:
Mean :
Using excel, =AVERAGE(C2:C43) which gives 92069.05
Population variance:
Population standard deviation:
Using excel:
Population variance: =VAR.P(C2:C43) which gives 108715946.71
Population standard deviation: =STDEV.P(C2:C43) which gives 10426.69
Values found by excel and calculated values are same.
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Chapter 4 Solutions
Business Analytics (2nd Edition)
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