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Real estate prices in the coastal town of Lockland have a mean of $240,000 and a...

Real estate prices in the coastal town of Lockland have a mean of $240,000 and a standard deviation of $150,000. Many of the properties are two- and three-bedroom cottages in the $100,000 to $150,000 price range, but there are several ocean-view homes with prices well over $1 million.

Use a compelling mathematical argument to show that the real estate prices in Lockland are not normally distributed.

math   Statistics-And-Probability   
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Answer #1

Let X denotes the real estate price

\ ext{Given, }E(X)=240,000;sd(X)=150,000 \ ext{If X}sim N(240000,150000^2) ext{ then }P(X>10^6)approx 0 \ ext{Since there are many observations above 1 million, we can infer than} \ ext{price may not be normally distributed}

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