The homeownership rate in the U.S. was 60.9% in 2009. In order to determine if h

Question

The homeownership rate in the U.S. was 60.9% in 2009. In order to determine if homeownership is linked with income, 2009 state level data on homeownership rate (Ownership) and median household income (Income) were collected. The data is shown below.

State       

   Income

      Ownership

  Alabama

$35,670   

66.1%    

  Alaska

$57,294   

62.1%    

  Arizona

$41,429   

62.4%    

  Arkansas

$32,228   

60.4%    

  California

$51,824   

52.6%    

  Colorado

$51,620   

63.1%    

  Connecticut

$60,541   

65.8%    

  Delaware

$47,804   

70.2%    

  District of Columbia

$48,831   

41.3%    

  Florida

$41,321   

64.2%    

  Georgia

$39,030   

60.7%    

  Hawaii

$51,339   

54.9%    

  Idaho

$42,468   

68.5%    

  Illinois

$48,560   

63.5%    

  Indiana

$39,995   

65.0%    

  Iowa

$46,411   

66.2%    

  Kansas

$40,407   

60.9%    

  Kentucky

$38,354   

64.0%    

  Louisiana

$41,123   

65.1%    

  Maine

$43,192   

67.3%    

  Maryland

$59,876   

64.9%    

  Massachusetts

$55,063   

60.4%    

  Michigan

$41,684   

67.5%    

  Minnesota

$51,780   

67.3%    

  Mississippi

$30,768   

66.2%    

  Missouri

$44,459   

65.6%    

  Montana

$36,127   

63.2%    

  Nebraska

$45,285   

64.1%    

  Nevada

$47,124   

57.2%    

  New Hampshire

$59,821   

70.9%    

  New Jersey

$60,467   

61.5%    

  New Mexico

$39,232   

62.3%    

  New York

$45,906   

49.7%    

  North Carolina

$37,596   

62.9%    

  North Dakota

$45,765   

60.0%    

  Ohio

$41,569   

63.2%    

  Oklahoma

$41,568   

63.1%    

  Oregon

$44,788   

62.2%    

  Pennsylvania

$43,862   

65.7%    

  Rhode Island

$47,324   

57.6%    

  South Carolina

$36,791   

66.6%    

  South Dakota

$41,516   

63.1%    

  Tennessee

$36,207   

63.5%    

  Texas

$43,165   

59.5%    

  Utah

$54,181   

68.6%    

  Vermont

$48,008   

68.2%    

  Virginia

$56,191   

64.7%    

  Washington

$56,082   

60.8%    

  West Virginia

$36,180   

70.3%    

  Wisconsin

$46,927   

64.5%    

  Wyoming

$48,160   

67.7%    

Estimate the model: Ownership = 0 + 1Income + . (Negative values should be indicated by minus sign. Round your answers to 4 decimal places.)

The homeownership rate in the U.S. was 60.9% in 2009. In order to determine if homeownership is linked with income, 2009 state level data on homeownership rate (Ownership) and median household income (Income) were collected. The data is shown below.

Explanation / Answer

Independent variable: income

Dependent variable: Ownership

Following is output of regression analysis generated by excel:

So regression equation is

Ownership = 0.6566 - 5.6480*Income

SUMMARY OUTPUT Regression Statistics Multiple R 0.081189776 R Square 0.00659178 Adjusted R Square -0.013681857 Standard Error 0.052503925 Observations 51 ANOVA df SS MS F Significance F Regression 1 0.000896302 0.000896302 0.32514046 0.57114015 Residual 49 0.135076443 0.002756662 Total 50 0.135972745 Coefficients Standard Error t Stat P-value Lower 95% Upper 95% Intercept 0.656568198 0.045710117 14.36373911 3.42964E-19 0.56471028 0.748426116 Income -5.64799E-07 9.90508E-07 -0.570210891 0.57114015 -2.5553E-06 1.4257E-06

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