Question 1.65

1.65 Salary increase for the owners.

Last year, a small accounting firm paid each of its five clerks $40,000, two junior accountants $75,000 each, and the firm’s owner $455,000.

  1. What is the mean salary paid at this firm? How many of the employees earn less than the mean? What is the median salary?
  2. This year, the firm gives no raises to the clerks and junior accountants, while the owner’s take increases to $495,000. How does this change affect the mean? How does it affect the median?

1.65

(a) . All the employees except for the owner make less than the mean. . (b) The mean increases to $105,625. The median does not change.