Solved

A County Real Estate Appraiser Wants to Develop a Statistical E(y)=β0+β1xE ( y ) = \beta _ { 0 } + \beta _ { 1 } x

Question 37

Multiple Choice

A county real estate appraiser wants to develop a statistical model to predict the appraised value of houses in a section of the county called East Meadow. One of the many variables thought to be an important predictor of appraised value is the number of rooms in the house. Consequently, the
Appraiser decided to fit the linear regression model: E(y) =β0+β1xE ( y ) = \beta _ { 0 } + \beta _ { 1 } x
where y=y = appraised value of the house (in thousands of dollars) and x=x = number of rooms. Using data collected for a sample of n=74n = 74 houses in East Meadow, the following result was obtained:
y^=74.80+19.72x\hat { y } = 74.80 + 19.72 x
Which of the following statements concerning the deterministic model, E(y) =β0+β1xE ( y ) = \beta _ { 0 } + \beta _ { 1 } x is true?


A) A plot of the predicted appraised values yy against the number of rooms xx for the sample of houses in East Meadow would not result in a straight line.
B) In theory, a plot of the mean appraised value E(y) E ( y ) against the number of rooms xx for the entire population of houses in east Meadow would result in a straight line.
C) In theory, if the appraised values yy and number of rooms xx for the entire population of houses in East Meadow were obtained and the (x,y) ( x , y ) data points plotted, the points would fall in a straight line.
D) All of the above statements are true.

Correct Answer:

verifed

Verified

Unlock this answer now
Get Access to more Verified Answers free of charge

Related Questions

Unlock this Answer For Free Now!

View this answer and more for free by performing one of the following actions

qr-code

Scan the QR code to install the App and get 2 free unlocks

upload documents

Unlock quizzes for free by uploading documents