Page 552 Problem 1

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1. Explore the relationship between the selling prices ( Y) and the appraised values ( X) of the 148 homes in the file P02_ 11. xlsx by estimating a simple linear regression model. Interpret the standard error of estimate s e and R2 and the least squares line for these data. a. Is there evidence of a linear relationship between the selling price and appraised value? If so, characterize the relationship. Is it positive or negative? Is it weak or strong? b. For which of the three remaining variables, the size of the home, the number of bedrooms, and the number of bathrooms, is the relationship with the home’s selling price stronger? Justify your choice with additional simple linear regression models.

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