More real estate Consider the Albuquerque home salesfrom Exercise 25 again. The regression analysis gives themodel Price = 47.82 + 0.061 Size.a) Explain what the slope of the line says about housingprices and house size.b) What price would you predict for a 3000-square-foothouse in this market?c) A real estate agent shows a potential buyer a1200-square-foot home, saying that the asking priceis $6000 less than what one would expect to pay for ahouse of this size. What is the asking price, and whatis the $6000 called?
Correlation
Correlation defines a relationship between two independent variables. It tells the degree to which variables move in relation to each other. When two sets of data are related to each other, there is a correlation between them.
Linear Correlation
A correlation is used to determine the relationships between numerical and categorical variables. In other words, it is an indicator of how things are connected to one another. The correlation analysis is the study of how variables are related.
Regression Analysis
Regression analysis is a statistical method in which it estimates the relationship between a dependent variable and one or more independent variable. In simple terms dependent variable is called as outcome variable and independent variable is called as predictors. Regression analysis is one of the methods to find the trends in data. The independent variable used in Regression analysis is named Predictor variable. It offers data of an associated dependent variable regarding a particular outcome.
More real estate Consider the Albuquerque home sales
from Exercise 25 again. The
model Price = 47.82 + 0.061 Size.a) Explain what the slope of the line says about housing
prices and house size.
b) What price would you predict for a 3000-square-foot
house in this market?
c) A real estate agent shows a potential buyer a
1200-square-foot home, saying that the asking price
is $6000 less than what one would expect to pay for a
house of this size. What is the asking price, and what
is the $6000 called?
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