The following data on sale, size, and land-to-building ratio for 10 large industrial properties appeared in the
Question:
The following data on sale, size, and land-to-building ratio for 10 large industrial properties appeared in the paper “Using Multiple Regression Analysis in Real Estate Appraisal” (Appraisal Journal [2002]: 424-430):
a) Calculate and interpret the value of the correlation coefficient between sale price and size.
b) Calculate and interpret the value of the correlation coefficient between sale price and land-to-building ratio.
c) If you wanted to predict sale price and you could use either size or land-to-building ratio as the basis for making predictions, which would you use? Explain.
d) Based on your choice in Part (c), find the equation of the least-square regression line you would use for predicting y = sale price.
Quantitative Methods for Business
ISBN: 978-0324651751
11th Edition
Authors: David Anderson, Dennis Sweeney, Thomas Williams, Jeffrey cam