Outliers

An outlier is an observation that lies an unusual distance from other observations. There is a judgmental element in deciding what is considered unusual, and it helps to work with the subject-matter expert in deciding this. In exploratory data analysis, there are two activities that are linked:

• Examining the overall shape of the graphed data for important features
• Examining the data for unusual observations that are far from the mass or general trend of the data

Outliers are data points that deserve a closer look. The values could be real data values accurately recorded or the values could be misrecorded or otherwise flawed data. You need to discern what is the case in your situation and decide what action to take.

In this section, we consider statistical and graphical ways of summarizing the distribution of a variable and detecting unusual/extreme values. IBM SPSS Statistics provides many tools for this, which are found in procedures such as Frequencies, Examine, and Chart Builder. To explore these facilities, we introduce data on used Toyota Corollas and, in particular, look at the distribution of the offer prices, in Euros, of sales in the Netherlands in the year 2004.