3. 10.00 points Chapter 13 - MC Qu. 88 A real estate analyst believes that the t

Question

3. 10.00 points Chapter 13 - MC Qu. 88 A real estate analyst believes that the three main factors that influence an apartment's rent in a college town are the number of bedrooms, the number of bathrooms, and the apartment's square footage. For 40 apartments, she collects data on the rent (y, in $), the number of bedrooms(x), the number of bathrooms (2), and its square footage (x3). She estimates the following model: Rents A) + 1 Bedroom + 2 Bath + 3SqftThe following table shows a portion of the regression results. df Regression Residual Total MS 1,898,239 37,310 Significance F 4.99E-13 5,694,717 1,343,176 7037,893 Standard Error 84.0 60.3 55.9 0.09 50.88 36 39 Coefficients 300 226 89 0.2 t-stat 3.57 3.75 1.59 2.22 p-value 0.0010 0.0006 0.1195 0.0276 Lower 95% 130.03 103.45 24.24 0.024 Upper 95% 470.79 348.17 202.77 0.39 Intercept Bath Sq ft when testing whether Bath is significant at the 5% significance level, she rejects Ho#2-o, and concludes that the number of bathrooms significantly influences rent O does not reject Ho:82 O, and concludes that the number of bathrooms significantly influences rent rejects :2-0, and concludes that the number of bathrooms does not significantly influence rent O does not reject Hof½-o, and concludes that the number of bathrooms does not significantly influence rent.

Explanation / Answer

Q3) Option D is Correct because p value of 0.1195 is very high and we conclude that it is not significant

Q4) Predicted Y = 1.32+0.0345*140+1.45*0 = 6.15

Residual = 7.3-6.15 = 1.15

So, Option B is Correct

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