Question

Ches A realtor in Arlington, Massachusetts, is analyzing the relationship between the sale price of a home (Price in $), its square footage (Sqft), the number of bedrooms (Beds), and the number of bathrooms (Baths). She collects data on 36 sales in Arlington in the first quarter of 2009 for the analysis. A portion of the data is shown in the accompanying table. Price 672.000 569.077 Sqft 2,212 1.731 Beds Baths 5 1.0 11.5 307,500 850 1 1.0 Click here for the Excel Data File a. Estimate the model Price = 30 + BiSqft + B2Beds + BxBaths + E. (Round Coefficients to 2 decimal places.) Coefficients nces Intercept Soft Beds Baths b-1. Interpret the coefficient of sqft. For every additional square foot, the predicted price of a home increases by $117.45. O For every additional square foot, the predicted price of a home increases by $117.45, holding number of bedrooms and bathrooms constant. For every additional square foot, the predicted price of a home increases by $117.45, holding square foot, number of bedrooms and bathrooms constant.

Answer 1

using excel>data >data analysis>Regression

we have

SUMMARY OUTPUT
Regression Statistics
Multiple R	0.818008
R Square	0.669136
Adjusted R Square	0.638118
Standard Error	89668.89
Observations	36
ANOVA
	df	SS	MS	F	Significance F
Regression	3	5.2E+11	1.73E+11	21.5722	7.9E-08
Residual	32	2.57E+11	8.04E+09
Total	35	7.78E+11
	Coefficients	Standard Error	t Stat	P-value	Lower 95%	Upper 95%
Intercept	80619.83	64052.18	1.258659	0.217259	-49850.2	211089.9
Sqft	117.4377	38.69829	3.034702	0.004753	38.61192	196.2636
Beds	41233.6	21480.65	1.919569	0.063866	-2521.06	84988.25
Baths	45886.41	26603.14	1.72485	0.094202	-8302.41	100075.2

a )

Intercept	80619.83
Sqft	117.4377
Beds	41233.6
Baths	45886.41

b 1 ) interpretation

For every additional sqft , the predicted price of a home increases by 117.45 holding number of bedrooms and bathrooms constant '

c) for sqft = 2.041 ., bedrooms = 2, bathrooms = 1

predicted price = 80619.83+117.4377*2.041+41233.6*2+45886.41*1 = 209213.1

predicted price = $209213