Exp$22\_$Excel$\_$Ch$08\_$CumulativeAssessment$\_$Variation $-$ Real Estate Valuation

Exp$22$ Excel Ch$08$ CumulativeAssessment Variation Real Estate Valuation

Excel Chapter $8$ Cumulative Assessment $-$ Variation Real Estate Valuation

Project Description:

You are an analyst for a local real estate agency. As part of your duties, you track sales and use historical data to help determine home value based on square footage. You have decided to use analysis tools in Excel to calculate descriptive statistics and correlation between square footage and real estate sales data. Last you will forecast home values based on historical sales data.

Start Excel. Download and open the file named Exp$22\_$Excel$\_$Ch$08\_$CumulativeAssessment$\_$Variation$\_$Valuation.xlsx$.$ Grader has automatically added your last name to the beginning of the filename.

Ensure the Sales Data worksheet is active, then use the FREQUENCY function to calculate the frequency distribution of the square footage of homes located in column D$.$ Place your results in the range H$4$:H$11.$

Enter a function in cell J$4$ to calculate the standard deviation of the current home values $($column E$).$

Enter a function in cell J$7$ to calculate the variance of the current home values $($column E$).$

Enter a function in cell J$10$ to calculate the covariance between square footage $($column C$)$ and the current home values $($column E$).$

Enter a function in cell J$13$ to calculate the correlation between square footage $($column C$)$ and the current home values $($column E$).$

Apply Accounting Number format to cell J$4.$

Ensure the Analysis ToolPak add$-$in is active. Insert a histogram based on the square footage located in column C$.$ Move the chart so the upper$-$left corner is in cell G$15.$ Resize the chart so if fills the range G$15$:J$28.$

Make the Subdivisions worksheet active. Use the Analysis ToolPak to perform a single factor ANOVA including labels on the range C$2$:E$45.$ Place the results starting in cell G$4.$ Resize columns G:M as needed.

Create a forecast sheet that depicts increase in home valuation in the Gatewood subdivision based on square footage. Set the Forecast square footage to $3500$ and place the results on a new worksheet named Gatewood Forecast. Resize and reposition the chart to fill the range G$2$:P$22.($On a Mac, the Forecast Sheet feature is not available. Please insert a blank worksheet named Gatewood Forecast and advance to the next step$).$

Make the Forecast worksheet active and create a scatter plot chart that places the square footage on the X axis and the Purchase Price on the Y axis. Be sure to add an appropriate chart title.

Add a linear trendline to the chart that also shows the Equation and the R$-$squared value. Reposition the equation so it is in the upper$-$left corner of the plot area.

Enter a function in cell E$3$ to calculate the intercept of the linear trendline created in the prior step.

Enter a function in cell F$3$ to calculate the Slope of the linear trendline.

Enter a function in cell G$3$ to calculate the RSQ of the linear trendline.

Enter a function in cell H$3$ to calculate the standard error. Format the results as Currency.

Use the FORECAST.LINEAR function in cell F$6$ to forecast an appropriate value of a $4,500-$square$-$foot home based on the historical data in columns B:C$.$ Format the results as Currency.

Complete your analysis by adding formulas in the range G$6$:H$6$ to calculate the high and low thresholds of the forecast.