Question

# You are a member of your local apartment association. The association represents rental housing owners and...

1. You are a member of your local apartment association. The association represents rental housing owners and managers who operate residential rental property throughout the greater metropolitan area.  Recently, the association has received several complaints from tenants in a particular area of the city who feel that their monthly rental fees are much higher than other parts of the city.

You want to investigate the rental fees.  You gather the data shown in the table below.  Area A represents the area of the city where tenants are unhappy about their monthly rents.  The data represent the monthly rents paid by a random sample of tenants in Area A and three other areas of similar size.  Assume all the apartments represented are approximately the same size with the same amenities.

 Area A Area B Area C Area D 1275 1124 1085 928 1110 954 827 1096 975 815 793 862 862 1078 1170 735 1040 843 919 798 997 745 943 812 1119 796 756 1232 908 816 765 1036 890 938 809 998 1055 1082 1020 914 860 750 710 1005 975 703 775 930
1. Which statistical measure(s) do you think would best represent the data sets for the four areas of the city?
2. Calculate the measure(s) for all 4 sets of the data.
4. Do you think the complaints in Area A are legitimate?  How do you think they should be addressed?
5. What are some of the reasons the rents may vary among different areas in the city?

Solution :

a)

For measure of central tendency we use mean as a best measure and standard deviation is the best measure for measures of dispersion for this data set.

b)

 Area A B C D Mean 1005.5 887 881 945.5 Standard Deviation 123.0724 144.9125 146.2091 138.7014

c)

Yes. We can draw mean-sd chart for explaination:

d)

 Area A B C D Mean 1005.5 887 881 945.5 Standard Deviation 123.0724 144.9125 146.2091 138.7014 CV(%) 0.12 0.16 0.17 0.15

Since mean of Area A is largest and CV (coefficient of variation) of Area is smallest so the complaints in Area A are legitimate.

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