The arithmetic mean of 100 observations is 50. If 5 is subtracted from each observation and then divided by 20, then what is the new arithmetic mean?
- A. 2.25 ✓
- B. 3.5
- C. 4.25
- D. 5.5
Correct Answer: A. 2.25
Explanation
If a constant a is subtracted from each observation and divided by b, the new mean transforms in the same way. New Mean = \frac{\text{Old Mean} - 5}{20} = \frac{50 - 5}{20} = \frac{45}{20} = 2.25.
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