Question

Age     #Bathrooms      #Rooms  #BedRooms       Age     #FirePlaces     sellingPrice in $100
42      1       7       4       42      0       4.9176
62      1       7       4       62      0       5.0208
40      1       6       3       40      0       4.5429
54      1       6       3       54      0       4.5573
42      1       6       3       42      0       5.0597
56      1       6       3       56      0       3.891
32      1       6       3       32      0       5.6039
32      1       6       3       32      0       5.8282
30      1       6       3       30      0       5.3003
30      1       5       2       30      0       6.2712
32      1       6       3       32      0       5.9592
32      1       6       3       32      0       5.6039
50      1.5     8       4       50      0       8.2464
17      1.5     6       3       17      0       7.7841
23      1       7       3       23      0       9.0384
22      1.5     6       3       22      0       7.5422
44      1.5     6       3       44      0       6.0931
3       1       7       3       3       0       8.14
31      1.5     8       4       31      0       9.1416
51      1       7       3       51      1       5.898
42      2.5     10      5       42      1       16.4202
14      2.5     9       5       14      1       14.4598
46      1       5       2       46      1       5.05
22      1.5     7       3       22      1       6.6969
40      1       6       3       40      1       5.9894
50      1.5     8       4       50      1       8.7951
48      1.5     8       4       48      1       8.3607
30      1.5     6       3       30      1       12

Open House_Price5variables data. Create scattered plot chart with X representing the age of the house and Y representing the selling price of the house in $100,000; plot the line and compute the R-square. Answer questions 9 to 12:

9. What are the slope and the R-squares on your chart? (4 points)

• a. Slope= -1.6019, R-square=0.1175
• b. Slope=-0.0734, R-square=0.1175
• c. Slope=9.8861, R-square=0.1175
• d. Slope=47.89, R-square=0.1175

10. What is the Y-intercept and its interpretation based on the chart? (4 points)

• a. Y-intercept=9.8861, it is the predicted selling price of a brand new house (zero year-old house) in $100,000.
• b. Y-intercept=47.89, it is the predicted selling price of a brand new house (zero year-old house) in $100,000.
• c. Y-intercept=9.8861, for one additional year one expects to see a decrease of about 9.8861 hundred thousand dollars in the selling price of the house.
• d. Y-intercept=47.89, for one additional year one expects to see a decrease of about 47.89 hundred thousand dollars in the selling price of the house.

11. If a house is 7 years old, using the chart and the equation, what is your prediction of the house’s selling price? Pick the closest answer. (4 points)

• a. $ 3,667,670.00
• b. $ 937,230.00
• c. $ 1,039,990.00
• d. $ 5,910,330.00

12. What does each dot represent? (4 points)

• a. The Selling Price of a house
• b. The Age of a house
• c. A House
• d. The housing market

Answer 1

We use Excel to solve this question-

9)
b) slope = - 0.0734, R-square = 0.1175
10)
Y-intercept = 9.8861, it is the predicted selling price of a brand new house (zero year-old house) in $ 100,000.
11)
The predicted regression equation is,
selling price (y^) = 9.8861 + (-0.0734 * Age)
At Age = 7 years old the prediction of the house selling price is given by,
selling price (y^) = 9.8861 + (-0.0734 * Age)
selling price (y^) = 9.8861 + (-0.0734 * 7)
selling price (y^) = 9.3723000
selling price (y^) =$ 937230.00
12)
Each dot represents,
d) The housing market