A county real estate appraiser wants to develop a statistical model to predict t

Question

A county real estate appraiser wants to develop a statistical model to predict the appraised variables value of houses in a section of the county called East Meadow. One of the many thought to be an important predictor of appraised value is the number of rooms in th Consequently, the appraiser decided to fit the simple linear regression model, y-po-pp, where y = appraised value of the house (in $thousands) and x = number of rooms. Using data collected for a sample of n = 74 houses in East Meadow, the following results were obtained: e house. y= 74.80 + 20.86x s = 71.24, t = 1.05 (for testing 0) sg = 2.63, t = 7.49 (for testing SSE = 60,775, MSE = 841 , s = 29, r2 = .44 Range of the x-values: 5-11 Range of the y-values: 160-300 Give a practical interpretation of the estimate of the slope of the least squares line. o For each additional room in the house, we estimate the appraised value to increase o For each additional dollar of appraised value, we estimate the number of rooms in the o For each additional room in the house, we estimate the appraised value to increase o For a house with 0 rooms, we estimate the appraised value to be $74,800 $74,800. house to increase by 20.86 rooms. $20,860.

Explanation / Answer

Interpretation of SLope :  

For each additional room in the house, we estimate the appraised value to increase $20,860

Option 3 is correct

Q 4

r =0.66

R2 = (0.66)2 *100% = 43.56%

Option 1 is correct

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