In This Chapter
Learning how to identify outliers with formal statistical procedures
Seeing how outliers affect statistical tests
Finding out how to avoid the problems associated with outliers
An outlier is a member of a dataset that’s significantly larger or smaller than the other values in the dataset. Outliers can appear in all walks of life. For example, the following would be considered outliers:
In statistical analysis, an outlier refers to a value that is substantially different from the other values within a sample or a population. For example, suppose you take a sample of housing prices in a small town, with the following results (in hundreds of thousands of dollars):
240, 270, 290, 305, 332, 348, 371, 404, 2,250
In this case, you would consider the home that’s worth $2.25 million to be an outlier because it’s so much more expensive than the other homes in that town. In fact, it’s more than five times as costly as the next most expensive ...