You apply for a job selling diet marshmallows because an ad says that the average company employee earns $50,000 a year. Later you discover that the company has a president, a sales manager, and 30 salespeople; you also learn that each salesperson earns $14,000 a year. How can the company's claim be correct?

Question

Quizplus · Accepted Answer

The average salary of $50,000 is referring to the mean, which is calculated by adding up all the salaries and dividing by the number of employees. This means that the high salaries of the president and sales manager are being factored into the overall average, despite the fact that most salespeople earn significantly less. Therefore, the claim is correct based on the mean salary.

You Apply for a Job Selling Diet Marshmallows Because an Ad