Which average is most drastically affected by extreme outlier values? MCQ with Answer and Explanation

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Which average is most drastically affected by extreme outlier values?

A. Geometric Mean

B. Median

C. Mode

D. Arithmetic Mean

Answer: Option D

Solution (By JKSSB Mock Tests)

Since the Arithmetic Mean includes every single value in its calculation, a massive outlier will heavily pull the mean.

This question belongs to: Accountancy and Statistics Statistics

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Question #1

A fixed base index number series is one where:

A. Only geometric mean is used

B. All periods are compared to a single fixed base period

C. The base period changes every year

D. Weights change every period

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Correct Answer: Option B

Explanation:
In fixed base method, a particular year is chosen as base and all other years are compared to it.

This question belongs to: Accountancy and Statistics Statistics

Question #2

The Paasche index is likely to understate price rise because:

A. It is unweighted

B. It uses base year quantities

C. It uses geometric mean

D. It uses current year quantities, reflecting substitution

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Correct Answer: Option D

Explanation:
Substitution away from goods whose prices rose relatively reduces their weight, leading to underestimation.

This question belongs to: Accountancy and Statistics Statistics

Question #3

Bayes' Theorem is primarily used to calculate:

A. Joint probabilities

B. Prior probabilities

C. Marginal probabilities

D. Posterior probabilities

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Correct Answer: Option D

Explanation:
Bayes' theorem updates prior probabilities using new evidence to compute posterior probabilities.

This question belongs to: Accountancy and Statistics Statistics

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