Below is some of the regression output from a regression of the amount rental ho

Question

Below is some of the regression output from a regression of the amount rental houses on an island rent for (expressed in thousands of exist's) based on the size of the house (expressed in square feet), whether the house has an ocean front view (VIEW = 1 if it has an ocean front view and 0 if not), and an interaction term between the ocean front view dummy variable and the size of the house. If the estimated equation is: Price = 1, 392 + 0.31 * Size + 1.987 * View + 0.05 * (Size * View) Suppose you just built a house with an ocean front view that is 1300 square feet and you want to decide how much to rent it for. What is the predicted price of a house that is 4300 square feet and has an ocean front view? (please express your answer using 1 decimal places)

Explanation / Answer

For size = 4300, View = 1

Price = 1392 + 0.31*4300 + 1987*1 + 0.05*(4300*1)

Price = 4927 thousand dollars = 4927000 dollars

So,

The answer would be 4927000.0

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