Question

David's Landscaping has collected data on home values (in thousands of $) and expenditures (in thousands of $) on landscaping with the hope of developing a predictive model to help marketing to potential new clients. Data for households may be found in the file Landscape. Click on the datafile logo to reference the data. Home Value ($1000) Landscape Expenditures ($1000) 242 8.1 321 10.8 198 12.2 340 16.2 300 15.6 400 18.9 800 23.5 200 9.5 521 17.5 547 22 437 12.1 464 14 635 17.9 356 13.9 If required, enter negative values as negative numbers. a. Select a scatter diagram with home value as the independent variable. A. B. C. - Select your answer -Graph AGraph BGraph CItem 1 b. What does the scatter plot developed in part (a) indicate about the relationship between the two variables? The scatter diagram indicates a - Select your answer -negativepositiveItem 2 linear relationship between the two variables. c. Use the least squares method to develop the estimated regression equation (to decimals). + d. For every additional in home value, estimate how much additional will be spent on landscaping (to decimals). $ e. Use the equation estimated in part (c) to predict the landscaping expenditures for a home valued at (to the nearest whole number). $

Answer 1

a. Graph A
b. Positive
c. Landscape Expenditures = -14.052 + 0.033 * Home Value
d. $33
e. $3,406.

a. The scatter diagram that represents the relationship between home value and landscaping expenditures is graph A.
b. The scatter plot developed in part (a) indicates a positive linear relationship between the two variables.
c. Using the least squares method, the estimated regression equation is: Landscape Expenditures = -14.052 + 0.033 * Home Value.
d. For every additional $1,000 in home value, an additional $33 will be spent on landscaping.
e. Using the equation estimated in part (c), the predicted landscaping expenditures for a home valued at $450,000 is approximately $3,406.