Question

QUESTION 7 A family moved to Orlando, FL and bought a home. They paid $350,000 for their house. In their neighborhood the mean price of a home is $375,000 with a standard deviation of $7,500. Calculate the z-score for the price of their home and indicate if the price they paid for their home usual or unusual. Choose one • 10 points The z-score is 3.333 and it is usual The z-score is -3.333 and it is usual The z-score is 3.333 and it is unusual The z-score is -3.333 and it is unusual

Answer 1

Explanation:

The z-score for the price of the family's home can be calculated as follows:

z = (350,000 - 375,000) / 7,500 = -3.333

A negative z-score indicates that the value is below the mean. Therefore, the price the family paid for their home is lower than the average price of homes in their neighborhood, so it can be considered unusual.

So, the answer is: The z-score is -3.333 and it is unusual.