QUESTION 11 Questions 11-14 refer to the following multiple regression analysis

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QUESTION 11 Questions 11-14 refer to the following multiple regression analysis results. The variables are VALUE (Real estate Assessment), in dollars; SQFT Area of the house) in square feet; URBANCT (Distance from an Urban Center) in miles; and TYPE (Custom (coded 0) or track (coded 1). A summary of the regression follows: VALUE = 286193 + 146 SQFT-87478 TYPE-4048 URBNCT Constant 286193 128586 2.23 4.65 1.86 0.041 0.000 0.081 144 SOFT | 146 TYPE URBNCT I 31.36 78 47012 87478 4048 18531- -2.190H4 s-97610 R-Sq-85.8% R-Sq(adj)-83.2% If two houses are identical except that their area differs by 0.5 square feet, then the best estimate of the difference in assessed value between the two houses is 73 dollars 4048 dollars 146 dollars 292 dollars Click Save and Submit to save and submit. Click Save All Anscers to save all ansers

Explanation / Answer

Answer 11: 73 Dollars

Value = 286193 + 146 SQFT - 87478 TYPE - 4048 URBNCT

As other variables are same only area is different.

Difference in value = 146 * Difference in area = 146*0.5 = $ 73

Answer 12: 87478 dollars less than for Custom houses

For Custom houses, TYPE = 0

Value = 286193 + 146 SQFT - 4048 URBNCT

For Track houses, TYPE = 1

Value = 286193 + 146 SQFT - 87478 - 4048 URBNCT

So, it can be seen that value of Track houses will be $ 87478 less than Custom houses

Answer 13: $391713

Value = 286193 + 146 SQFT - 87478 TYPE - 4048 URBNCT

TYPE = 0 (Track house), SQFT = 1000, and URBNCT = 10

Value = 286193 + 146*1000 - 87478*0 - 4048*10

Value = $ 391713

Answer 14: There is evidence that square footage of house significantly contirbutes to the given model.

Reason: Since p value corresponding to square footage coefficient is less than 0.05 so relationship between square footage and value is statistically significant.

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