A loglevel model relating the natural logarithm of house pri

A log-level model relating the natural logarithm of house price, y, to square footage was fit. The fitted model is In (price) = 10.6 + 0.000246*sq_foot. What is the estimated price of a house that is 1,935 square feet? Do not round the value of the slope variable in your calculation; use ail digits.

Solution

putting sq_foot as 1935 in the equation we get

ln(price)=10.6+0.000246*1935=11.07601

hence the estimated price is e^11.07601=64602.6 [answer]