Question

You’re working as a real estate analyst. You are hoping to get an idea of the real estate market for a commercial property your company is looking to acquire. You run a search and find that 12 similar properties in your area have recently sold for (been valued by the market at) the below. Prices in $,000s.

(PLEASE SHOW ALL WORK ON WRITTEN, WORK SHOWN SHEET, INPUT FINAL ANSWERS BELOW)

970     850 870     930         940         860         850         750         712         701         993         981

(a) Calculate the 75^th Percentile.

(b) Explain what the 75^th percentile means and explain what it might mean in terms of the above scenario regarding acquiring this property.

(c) $940,000 represents what percentile of the data set.

Answer 1

b) We know that percentile give indication of measurment relative to whole obsevation. So, in total 12 properties in our area we have 962500 is at 75th position out of 100. So, 25% of the properties which are sold is atleast 962500 and 75% of the properties which are sold is at most 962500.

c) 940 represent

So, perecntile will be

i is position of 940 in ascending order

940 represent 71 th percentile