Question

A real estate Association in a suburban community would like to study the relationship between the size of a single-family house (as measured by number of rooms) and the selling price of the house (in thousands of dollars). Two different neighborhoods are included in the study, one on the east side of the community (=0) and the other on the west side (=1). A random sample of 20 houses was selected with the results given at left.

a. State the multiple regression equation that predicts the selling price based on the number of rooms in the neighborhood.

b. Interpret the regression coefficients in a.

c. Predict the selling price for a house with nine rooms that is located in an East-side neighborhood. Construct a 95% confidence interval estimate and 95% prediction interval.

d. Perform a residual analysis on the results and determine if the regression assumptions are valid.

e. Is there a significant relationship between the selling price and two independent variables at the 0.05 level of significance?
Price Rooms Neighborhood
309.6 7 0
307.4 8 0
340.3 9 0
346.5 12 0
298.2 6 0
337.8 9 0
324.1 10 0
313.2 8 0
327.8 9 0
325.3 8 1
308.5 6 1
361.3 13 1
337.4 10 1
346.2 10 1
342.4 9 1
323.7 8 1
329.6 8 1
343.6 9 1
360.7 11 1
348.3 9 1

Answer 1

Answer:----- Date:---25/07/2019

(d).