A Real Estate Agent wishes to see if home prices can be accurately predicted fro

Question

A Real Estate Agent wishes to see if home prices can be accurately predicted from the square footage of a house, the number of rooms a house has, the age of the house, and the location of the house (either north, south, east or west) the regression output is given below. Home prices were coded in $000s. The conclusion for the overall (global) test of the regression model at the 5% alpha-level is: 1. Since p-value is larger than alpha overall model is significant 2. Since p-value is smaller than alpha the overall model is not significant 3. Since p-value is smaller than alpha the overall model is significant 4. Since p-value is larger than alpha the overall model is not significant.

Explanation / Answer

Since in this case the significant value from ANOVA table is 0.011396993 which is less than 0.05, hence we reject null hypothesis at 5% level and say that overall model is significant.

Hence option 3 is correct.

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