Step 1: Use the given mean to find the sum of observations.
Given that the mean of 50 observations $x_1, x_2, \ldots, x_{50}$ is 16.
The formula for the mean is $\bar{x} = \frac{\sum x_i}{n}$.
Here, $\bar{x} = 16$ and $n = 50$.
\[ 16 = \frac{\sum_{i=1}^{50} x_i}{50} \]
Multiply both sides by 50:
\[ \sum_{i=1}^{50} x_i = 16 \times 50 = 800 \]
Step 2: Use the given variance to find the sum of squares of observations.
Given that the variance of 50 observations is 256.
The formula for variance is $\sigma^2 = \frac{\sum x_i^2}{n} - (\bar{x})^2$.
Here, $\sigma^2 = 256$, $n = 50$, and $\bar{x} = 16$.
\[ 256 = \frac{\sum_{i=1}^{50} x_i^2}{50} - (16)^2 \]
\[ 256 = \frac{\sum_{i=1}^{50} x_i^2}{50} - 256 \]
Add 256 to both sides:
\[ 256 + 256 = \frac{\sum_{i=1}^{50} x_i^2}{50} \]
\[ 512 = \frac{\sum_{i=1}^{50} x_i^2}{50} \]
Multiply both sides by 50:
\[ \sum_{i=1}^{50} x_i^2 = 512 \times 50 = 25600 \]
Step 3: Calculate the mean of the new set of observations $(x_i - 5)^2$.
The new observations are $(x_1-5)^2, (x_2-5)^2, \ldots, (x_{50}-5)^2$.
The mean of these new observations is $\frac{\sum_{i=1}^{50} (x_i - 5)^2}{n}$.
Expand the term $(x_i - 5)^2$: $(x_i - 5)^2 = x_i^2 - 10x_i + 25$.
So, the sum of the new observations is:
\[ \sum_{i=1}^{50} (x_i - 5)^2 = \sum_{i=1}^{50} (x_i^2 - 10x_i + 25) \]
Using the linearity of summation:
\[ = \sum_{i=1}^{50} x_i^2 - 10 \sum_{i=1}^{50} x_i + \sum_{i=1}^{50} 25 \]
\[ = \sum_{i=1}^{50} x_i^2 - 10 \sum_{i=1}^{50} x_i + 50 \times 25 \]
Step 4: Substitute the values found in Step 1 and Step 2.
We have $\sum x_i = 800$ and $\sum x_i^2 = 25600$.
\[ \sum_{i=1}^{50} (x_i - 5)^2 = 25600 - 10(800) + 1250 \]
\[ = 25600 - 8000 + 1250 \]
\[ = 17600 + 1250 \]
\[ = 18850 \]
Step 5: Compute the mean of the new observations.
The mean of the new observations is:
\[ \text{New Mean} = \frac{18850}{50} \]
\[ = 377 \]
Step 6: State the final answer.
The mean of $(x_1-5)^2, (x_2-5)^2, \ldots, (x_{50}-5)^2$ is 377.