|Trip||Days||Expenses||Expenses per day|
Question: The following data represents travel expenses ( other than transportation) for 7 trips made during november by a salesman of small firm. The auditor criticised these expenses as excessive asserting average expense per day is Rs 10 ( 70 divided by 7 ). The salesman replied that average is only Rs 4.20 ( 105 divided by 25 ) and that in any event median is the appropriate measure and is only Rs 3. The auditor rejoined that the arithmetic mean is the appropriate measure, but that the median is 6. a) Explain the proper interpretation of each of the four averages mentioned b) Which average seems to be appropriate to you
I'm self-studying statistics, I have read that median is an appropriate measure in case of skewed data or if outlier is present. I understand how the auditor and salesman are calculating the mean, and I think 105/25 = 4.20 is the correct mean. However, I do not understand how they are arriving at the median and which approach/statistic is correct.