Prepare for the SASB Fundamentals of Sustainability Accounting Level II Test. Study with multiple choice questions, gaining hints and explanations. Enhance your sustainability reporting skills and ace your exam!

Multiple Choice

Which statistic is most affected by outliers?

Outliers distort measures that rely on every data point, and the arithmetic average is the one that is most sensitive. The mean combines all values, so an extreme value adds a large amount to the total and, when divided by the count, shifts the average toward that outlier. This effect is especially pronounced in smaller data sets where a single unusual value represents a larger share of the data. The median resists this kind of distortion because it depends on the order of values. Unless outliers change the central position of the data, the middle value stays the same. The mode reflects the most frequent value, so an outlier that isn’t common doesn’t typically alter it. The range can change when an outlier appears, since it’s determined by the min and max, but it doesn’t reflect the overall data pattern the way the mean does. Therefore, the mean is the statistic most affected by outliers.

Outliers distort measures that rely on every data point, and the arithmetic average is the one that is most sensitive. The mean combines all values, so an extreme value adds a large amount to the total and, when divided by the count, shifts the average toward that outlier. This effect is especially pronounced in smaller data sets where a single unusual value represents a larger share of the data.

The median resists this kind of distortion because it depends on the order of values. Unless outliers change the central position of the data, the middle value stays the same. The mode reflects the most frequent value, so an outlier that isn’t common doesn’t typically alter it. The range can change when an outlier appears, since it’s determined by the min and max, but it doesn’t reflect the overall data pattern the way the mean does. Therefore, the mean is the statistic most affected by outliers.