The data in Table P-14 were collected as part of a study of real estate property evaluation. The numbers are observations on X = assessed value (in thousands of dollars) on the city assessor's books and Y = market value (selling price in thousands of dollars) for n = 30 parcels of land that sold in a particular calendar year in a certain geographical area.

a. Plot the market value against the assessed value as a scatter diagram.
b. Assuming a simple linear regression model, determine the least squares line relating market value to assessed value.
c. Determine r2 and interpret its value.
d. Is the regression significant? Explain.
e. Predict the market value of a property with an assessed value of 90.5. Is there any danger in making this prediction?
f. Examine the residuals. Can you identify any observations that have a large influence on the location of the least squares line?

TABLE P-14 Parcel Assessed Market Parcel Assessed Market 1 68,2 874 16 74.0 88.4 2 74.6 88.0 17 72893.6 3 64.672 18 804 92 576.0 9420 80.0 8 77.0 2.23 794 4 80.2 94.0 19 74.2 90.6 6 78.0 93.6 2 8.928 7 76.0 88.4 22 75.6 890 91.8 8.4 10 724 90.4 25 67.0 89.8 80.0 93.6 26 72.0 972 12 764 91427 73.6 95.2 13 70.2 89.6 28 714 88.8 14 75.8 91.8 29 81.974 15 79.2 948 30 806 95.4 75.2 90.4 24 82.2