In: Statistics and Probability
The following data on sale price, size, and land-to-building ratio for 10 large industrial properties appeared in a paper.
Property | Sale Price (millions of dollars) |
Size (thousands of sq. ft.) |
Land-to- Building Ratio |
1 | 10.6 | 2165 | 2.1 |
2 | 2.5 | 751 | 3.5 |
3 | 30.6 | 2421 | 3.6 |
4 | 1.9 | 223 | 4.8 |
5 | 20.0 | 3916 | 1.8 |
6 | 8.0 | 2865 | 2.3 |
7 | 10.1 | 1698 | 3.1 |
8 | 6.8 | 1045 | 4.7 |
9 | 5.9 | 1109 | 7.6 |
10 | 4.5 | 406 | 17.2 |
(a) Calculate the value of the correlation coefficient between
sale price and size. (Give the answer to three decimal
places.)
r =
(b) Calculate the value of the correlation coefficient between sale
price and land-to-building ratio. (Give the answer to three decimal
places.)
r =
(c) If you wanted to predict sale price and you could use either
size or land-to-building ratio as the basis for making predictions,
which would you use?
SizeLand-to-building ratio
(d) Based on your choice in Part (c), find the equation of the
least-squares regression line you would use for predicting
y = sale price. (Give answers to three decimal
places.)
= + x