Exercise 1. A real estate agent wishes to determine the selling price of residences using the size (square feet) and whether the residence is a condominium or a single-family home. A sample of 20 residences was obtained with the following results: Type Square Feet Price (8) Type Square Feet 1,375 1,825 1,650 1,960 1,360 1,200 2,000 1,755 Price (8) 199,700 Family 1,500 2,085 200,600 Condo 211,800 Condo 208,000 210,500 Family 233,300 Condo 197,100 Family 228,400 Family 215,800 Family 1,450 1,836 Family 1,730 1,726 2,300 187,200 Condo 190,900 Condo Condo 284,100 Family 207,200 185,200 312,200 Family 313,600 Condo Family 258,200 Family 203,100 1,650 239,000 Family Condo 1,950 1,850 184,400 1,545 Family 1,630 1. Produce a regression equation to predict the selling price for residences using a model of the following form: Ni = Bo + Birı + Phrı +e where: if a condo = Square footage and r2 = 1o ifa single-family home Interpret the estimated parameters 3, and , in the model give in part 1. Produce an equation that describes the relationship between the selling price and the square 2. 3. footage of (1) condominium and (2) single-family homes. 4. Conduct a test of hypothesis to determine if the difference between the average selling price of
Exercise 1. A real estate agent wishes to determine the selling price of residences using the size (square feet) and whether the residence is a condominium or a single-family home. A sample of 20 residences was obtained with the following results: Type Square Feet Price (8) Type Square Feet 1,375 1,825 1,650 1,960 1,360 1,200 2,000 1,755 Price (8) 199,700 Family 1,500 2,085 200,600 Condo 211,800 Condo 208,000 210,500 Family 233,300 Condo 197,100 Family 228,400 Family 215,800 Family 1,450 1,836 Family 1,730 1,726 2,300 187,200 Condo 190,900 Condo Condo 284,100 Family 207,200 185,200 312,200 Family 313,600 Condo Family 258,200 Family 203,100 1,650 239,000 Family Condo 1,950 1,850 184,400 1,545 Family 1,630 1. Produce a regression equation to predict the selling price for residences using a model of the following form: Ni = Bo + Birı + Phrı +e where: if a condo = Square footage and r2 = 1o ifa single-family home Interpret the estimated parameters 3, and , in the model give in part 1. Produce an equation that describes the relationship between the selling price and the square 2. 3. footage of (1) condominium and (2) single-family homes. 4. Conduct a test of hypothesis to determine if the difference between the average selling price of
Glencoe Algebra 1, Student Edition, 9780079039897, 0079039898, 2018
18th Edition
ISBN:9780079039897
Author:Carter
Publisher:Carter
Chapter10: Statistics
Section10.6: Summarizing Categorical Data
Problem 24PPS
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i want Solution Part 1, 2
Transcribed Image Text:Exercise 1.
A real estate agent wishes to determine the selling price of residences using the size
(square feet) and whether the residence is a condominium or a single-family home. A sample of 20 residences was
obtained with the following results:
Price (S) Type Square Feet Price (S)
199,700 Family
211,800
Туре Square Feet.
Condo
1,500
200,600
1,375
Condo
2,085
1,450
1,836
1,730
1,726
208,000
Condo
1,825
1,650
197,100 Family
228,400 Family
215,800 Family
Condo
210,500
Family
233,300 Family
187,200
1,960
1,360
Condo
190,900
312,200
185,200
Condo
1,200
Family
Family
Condo
239,000 Family
2,300
284,100
2,000
1,650
1,950
1,545
313,600
207,200
Family
Family
203,100 Family
1,755
1,850
258,200
184,400
Condo
1,630
1.
Produce a regression equation to predict the selling price for residences using a model of the
following form:
yi = Bo + Biri + hra +e
where:
if a condo
ri = Square footage and ra =
0 if a single-family home
2.
Interpret the estimated parameters and , in the model give in part 1.
3.
Produce an equation that describes the relationship between the selling price and the square
footage of (1) condominium and (2) single-family homes.
4.
Conduct a test of hypothesis to determine if the difference between the average selling price of
condominiums and single-family homes significant.
5.
What change would you expect in the estimated regression model if you recode ra as the following?
Rerun the regression model with the newly coded ra and verify your expectation.
1 if a single-family home
if a condo
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