Real estate redux. The regression of Price on Size of homes in Albuquerque had as described in Exercise 15.
a) What is the correlation between Size and Price?
b) What would you predict about the Price of a home one standard deviation above average in Size?
c) What would you predict about the Price of a home two standard deviations below average in Size?
Exercise:
Real estate. A random sample of records of sales of homes 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 R-squared of 71.4%. The residuals plot indicated that a linear model is appropriate.
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.