[See] A real estate appraiser has developed a regression model to help appraise residential housing in the area. The model was developed using recently
Question: A real estate appraiser has developed a regression model to help appraise residential housing in the area. The model was developed using recently sold homes in a particular neighborhood. The price (Y) of the house is based on the square footage (X) of the house. The model is
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Y = 13,473 + 37.65X
The coefficient of correlation for the model is 0.63.
- Use the model to predict the selling price of a house that is 1,860 square feet.
- A house with 1,860 square feet recently sold for $95,000. Explain why this is not what the model predicted.
- If you were going to use the multiple regression to develop an appraisal model, what other quantitative variable might be included in the model?
- What is the coefficient of determination for this model?
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