Question

7.1.29 A random sample of records of home sales from Feb. 15 to Apr.​ 30, 1993, from the files maintained by the Albuquerque Board of Realtors gives the Price and Size​ (in square​ feet) of 117 homes. A regression to predict Price​ (in thousands of​ dollars) from Size has an Upper R squared of 71.4 %. The residuals plot indicates that a linear model is appropriate. Complete parts a through c below.

(a) What are the variables and units in this regression?
(b) What units does the slope have?
(c) Do you think the slope is positive or negative? Explain.

Answer 1

Explanation:

Given that a random sample of records of home sales from Feb. 15 to Apr.​ 30, 1993, from the files maintained by the Albuquerque Board of Realtors gives the Price and Size​ (in square​ feet) of 117 homes.

A regression is done to predict Price​ (in thousands of​ dollars) from Size

Hence

a)we have size as independent variable and price as dependent variable. Units for size are square feet and price are in 1000s of dollars.

b) Slope will have unit has 1000dollar/sqft

c) Slope is positive since price is directly variant over size.

So slope will be positive.