Homework SourseA local real estate developer wishes to study the relationsh
A local real estate developer wishes to study the relationship between the size of home a client will purchase (in square feet) and other variables. Possible independent variables include the family income, family size, whether there is a senior adult parent living with the family (1 for yes, 0 for no), and the total years of education beyond high school for the husband and wife. The sample information is contained in the file RealEstateChapter14.
Mr. Robert Bostick is a real estate broker who asked you to produce a model to predict the square footage a potential buyer would purchase. Based on the data in the file RealEstateChapter14, is the overall regression model significant if ? = 0.05?
Write a memorandum to Mr. Bostick explaining if the model is significant and if so, which variables make a difference in the size of home a client might purchase.
Please do calculations in excel. If the answer is clear and complete I will up the bonus points.
Thanks.
| Real Estate | |||||
| Family | Square Feet | Income (000s) | Family Size | Senior Parent | Education |
| 1 | 2,771 | 46.9 | 3 | 0 | 4 |
| 2 | 2,380 | 68.4 | 2 | 1 | 6 |
| 3 | 3,283 | 104.5 | 3 | 0 | 7 |
| 4 | 3,119 | 94.1 | 3 | 1 | 0 |
| 5 | 3,217 | 50.6 | 3 | 0 | 2 |
| 6 | 2,595 | 114 | 3 | 1 | 10 |
| 7 | 4,480 | 125.4 | 6 | 0 | 6 |
| 8 | 2,520 | 83.6 | 3 | 0 | 8 |
| 9 | 4,200 | 133 | 5 | 0 | 2 |
| 10 | 2,800 | 95 | 3 | 0 | 6 |
Solution
Using Excel follow the steps mentioned below:
1. Enter the data in worksheet.
Click Data> Data analysis > Regression.
Let:
The obtained output is,
The smallest P-value of 0.019 suggests that there is relationship between square feet and family size. So, the P-values greater than 0.05 is not usefull for the model.
| Variables | |
| Dependent | Independent |
| Square Feet | Income (000s) |
| Family Size | |
| Senior Parent | |
| Education |
