Refer to Exercise 12.42 and data set EX1242.
a. Estimate the average increase in the price for an increase of 1 square foot for houses sold in the city. Use a 99% confidence interval. Interpret your estimate.
b. A real estate salesperson needs to estimate the average sales price of houses with a total of 2000 square feet of heated space. Use a 95% confidence interval and interpret your estimate.
c. Calculate the price per square foot for each house and then calculate the sample mean. Why is this estimate of the average cost per square foot not equal to the answer in part a? Should it be? Explain.
d. Suppose that a house with 1780 square feet of heated floor space is offered for sale. Construct a 95% prediction interval for the price at which the house will sell.