Rent_($) Bedrooms Age Blocks Month 7100 6 14 0.5 June 5100 5 5 1.5 June 2700 3 1
ID: 3183298 • Letter: R
Question
Rent_($) Bedrooms Age Blocks Month 7100 6 14 0.5 June 5100 5 5 1.5 June 2700 3 12 1 July 3800 5 10 2 June 7800 4 12 1 August 7900 5 12 1 July 1400 3 6 2 June 2500 3 4 2.5 July 10600 6 22 1.5 August 9100 5 16 0.5 August 3100 5 11 1.5 June 1200 2 16 3 August 1800 3 12 2 August 4400 4 9 1 June 10300 5 17 1 July 7500 4 12 1 July 5700 5 2 2 August 1200 2 15 2 June 12900 5 10 0.5 July 3500 4 9 1.5 June 7900 5 14 1.5 August 11900 4 3 0.5 August 9100 6 22 0.5 July 7100 6 16 1 July A realty company would like to develop a regression model to help it set weekly rental rates for beach properties during the summer season in a particular area. The independent variables for this model are the number of bedrooms a property has, its age, the number of blocks away from the ocean it is, and the rental month (June July, or August) These data are shown in the accompanying table for randomly selected rental properties. Complete p a through d belo EE Click the icon to view the data table a. Using technology, construct a regression model using all of the independent variables. Let variable M be one of the dummy variables for the month. Assign a 1 to July for this variable. Let Mon2 be another dummy variable for the month. Assign a 1 to August for this variable.) Complete the regression equation for the model below, where y Rent x Bedrooms x Age, x3 Blocks, x Mon1, and x Mon (Round to the nearest whole number as needed.) b. Interpret the meaning of each of the regression coefficients for the dumm variables. Select the correct choice below and fill in the answer boxes to complete your y choice (Round to the nearest dollar as needed.) O A. July rentals average more per week than June rentals. August rentals average more per week than June rentals O B. June rentals average ess per week than August rentals. July rentals average less per week than August rentals O C. July rentals average less per week than June rentals. August rentals average more per week than June rentals O D. June rentals average ess per week than July rentals. July rentals average less per week than August rentals c. A test for the significance of the overall regression model shows that it is significant using o 0.05. Using the p-values, identify which independent variables are significant with 0.05. Select all that apply A. Mon1 B. Mon2 C. Bedrooms D. Blocks E. Age d. Construct a regression model using only the significant variables found in part c and predict the average weekly rental rate during the month of August for a four-bedroom house that is 19 years old and two blocks from the ocean The predicted average weekly rental rate is (Round to the nearest dollar as needed.)Explanation / Answer
a)
y=3488.56+1092.424x1-45.4857x2-2654.79x3+2376.697x4+3402.343x5
b) A is the correct answer with 2376.697 and 3402.343.
c)
Bedrooms, Blocks, Mon1 and Mon2.
d)
The regression model would be as below:-
3246.855+1040.61(Bedrooms)-2646.3(Blocks)+2252.016(Mon1)+3300(Mon2)
3246.855+1040.61(4)-2646.3(2)+2252.016(0)+3300(1)
3246.855+4162.44-5292.6+0+3300=16001.895