Question

If the ceos salary of 1,000,000 is taken out of the list what I would happen to the mean and median 25,25,25,35,35,45,45,55,55

Answer 1

Both the mean and median decrease.

Explanation:

Median (without 1,000,000):

25, 25, 25, 35, 35, 45, 45, 55, 55

= 35

Median (with 1,000,000):

25, 25, 25, 35, 35, 45, 45, 55, 55, 1,000,000

= average of 35 and 45

= 40

As you can see, without the outlier, the value of the median decreases.

Mean (without 1,000,000):

= (25 + 25 + 25 + 35 + 35 + 45 + 45 + 55 + 55) / 9

= 38.3

Mean (with 1,000,000):

= (25 + 25 + 25 + 35 + 35 + 45 + 45 + 55 + 55 + 1,000,000) / 10

= 100,0034.5

As you can see, without the outlier, the value of the mean dramatically decreases.