Can you please help me to figure it out if my answer is correct. Below there are
ID: 2619114 • Letter: C
Question
Can you please help me to figure it out if my answer is correct. Below there are two questions related. Question 10 and 11 they are conected. Thank you
10 You have gained access to a dataset that includes commercial real estate transaction that took place during the 2010-2012 time period in Miami, FL and in San Francisco, CA. After general data "clean up" you ran the following regression both questi ns are togetherWhere Price-? + ?,SQ FT + ?-Year + ?3Class + ?4DurnMiami Price is the price in dollars paid for each property tra transacted SQFT is the size of each property transacted in squared feet -Year takes a value of0,1 or 2 if the transaction took place during the year 2010 2011 or 2012, respectively Class takes a value of 0, or 2 if the transacted property is ofclass A, B or C. respectively DumMiami is a dummy variable that takes a value of 1 if the property transacted is locate in Miami and 0 otherwise For each of the coefficients ((???,A, and ?.) please predict whether you expect it to be positive, negative or ambiguous and explain in one sentence Referring to problem 10, what other variables would you have liked to include in your regression if you could get any information you want about each List 3 additional variables you would have liked to include in your regression in order to improve its accuracy and clearly explain how each variable would be defined (like I did in in question 10) a. b. Briefly explain the sign you would expect (negative, positive or ambiguous) from the coefficient of each of these variables. Question 10 and 11 are together. Can you please help me. I just wanted to make sure my answer is accurate. thank youExplanation / Answer
10
B1- This should be positive since increase in the areas (SQFT) would defienetly increase the price of any property.
B2- It is ambigous I believe becuase which year the transaction took place doesnt really matter in price excpet if there is inflation.
B3 - It should be positive since class would define the rate of any property. If this is class A property which is location at superior location, then the price would be higher.
B4 - If this is located in Miami can be defined positively since that wouls add valu to property.
11.
Additional Variable
1. Inflation - It should be positively related since during inflation real estate prics would go high.
2. Economic outlook globally - This should be positively related. If there is a recession, real state price would be low.
3. Supply and demand - If demand were high or supply were less, they would derive the prices higher.