Used Saab prices. A linear model to predict the Price of a 2004 Saab 9-3 (in $)
ID: 3156143 • Letter: U
Question
Used Saab prices. A linear model to predict the Price of a 2004 Saab 9-3 (in $) from its Mileage (in miles) was fit to 38 cars that were available during the week of Jan 11, 2008. The model was
a) What is the explanatory variable ?
Mileage
Price
model
car
b)
What is the response variable ?
Mileage
Price
model
car
c)What does the slope mean in this context?
d)What does the y-intercept mean in this context? Is it meaningful?
3)What do you predict the price to be for a car with 100,000 miles on it?
24356
65188
22846
1510
f)If the price for a car with 100,000 miles on it was $24,000, what would the residual be?
24356
-1154
22846
1154
A.Mileage
B.Price
C.model
D.car
price = 24.35615-00151 MileageExplanation / Answer
a)
It is the variable used to predict "price", which is
OPTION A: MILEAGE [ANSWER]
********************
b)
It is the predicted variable,
OPTION B: PRICE [ANSWER]
******************
c)
For every 1 mile increase in mileage, there is an expected decrease of $0.0151 in the price of the car in dollars.
********************
d)
The y intercept is the price of a car when the mileage is 0. Yes, it is meaningful, because it predicts the price of a brand new car.
***********************
3.
As
price^ = 24356.15 - 0.0151Mileage
If mileage = 100000,
price^ = 24356.15 - 0.0151*100000 = 22846 [ANSWER, C]
**********************
4.
Hence,
residual = price - price^ = 24000 - 22846 = 1154 [ANSWER, D]
Related Questions
drjack9650@gmail.com
Navigate
Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.