The U.S. government keeps statistics on many people in America. One interesting

Question

The U.S. government keeps statistics on many people in America. One interesting statistic is the poverty rate. To be living in poverty, one must earn income below a certain threshold (approximately $900 per month). Many multi-millionaires are included in this statistic. Recently, Barbara Streisand was "living in poverty." In a particular year, she did not perform live, and her album sales were extremely slow. She has a great deal of wealth but had little income that year. Although she has more money than 99.99% of the rest of the population, the government believed that she was impoverished. What other statistic can you name that is misleading? Why?

Explanation / Answer

Since the statistic include multi-millionaires as well, So, the statistics which are affected by extreme values can be misleading. One such example is Mean. So, the average income of this group will be misleading as the group contains extreme observations(income of multi-millionaires in this case).

Even the standard deviation of the income of the group will not be a good statistic which can be used to make conclusions.

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