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1.Price Statistics 2. Price Histogram with Normal Plot 3. Price Versus Living Area
Observations/Comments –
• Mean of House prices is -$163,862 with Median price of $151,917
• Price distribution is positively skewed to right
• Standard Deviation of prices is -$67,652
• Price is directly proportional to the living area available in the house. This can be clearly
observed in the Graph-3 (neglecting few exceptions)
2. Although the plot is not perfectly normal but it does provide us a good statistical insight in terms of normal
mapping. We can clearly see the outliers in the below plotting which indicates very high prices. Also the
eviation from the straight line indicates the deviation from normal behaviour. But it is acceptable for
applying statistical analysis.
Graphical Insight
Mean 1,64,000
SD 68,000
xi 2,32,000
P(Price<232000) 84.13%
Yes, both models are similar and agrees with each other
C. Based on theoretical model, the price of 75%percentile house should be $209,865 while the
actual price is $205397 which are pretty much close to each other and hence agrees with each
other.
4. Below is the histogram for the living area data. As can be clearly seen in the histogram, the data appears
to be right skewed which is consistent with the summary statistics (Skewness -0.808)
5. Below is the graph for Log of Living room data. Yes, the graph looks almost perfectly normal when
compared to plotting the living room data.
Graphical Insights