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 value of houses in a section of the county called East Meadow. On e of the many variables thought to be an important predictor of appraised valu tofit the simple linear regression model,"y =B+Bx value of the house (in Sthousands) and x number of rooms. Using data y = 74.80+19.72 s = 71.24.1 = 1.05(for testing .) s= 2.637.49(for testing A) SSE = 60, 775, MSE = 841, s = 29. r-= 0.44 Range of the x-values: 5 11 Range of the y-values: 160-300 e is the number of rooms in the house. Consequently, the appraiser decided , where y= appraised -collected for a sample ofn=74 houses in-East Meadow, the-following results- Give the practical interpretation of the estimate of the y-intercept of the least squares line.

Explanation / Answer

The regression line of y on x is Y-cap= 74.80 + 19.72x

If X = nubmer of rooms = 0 then the prediction value of appraised valueof the house is Y-cap = $74.80
since it is meaningless because there is no rooms (i.e.nubmer of rooms = 0) the value of house cost is zero but the predicted Ycap = = $74.80

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