Question

An agent for a residential real estate company in a sub-urb located outside of Washington, DC, has the business objec-tive of developing more accurate estimates of the monthly rental cost for apartments. Toward that goal, the agent would like to use the size of an apartment, as defined by square footage to predict the monthly rental cost. The agent selects a sample of 48 one-bedroom apartments and collects and stores the data in RentSilverSpring .a. Construct a scatter plot.b. Use the least-squares method to determine the regression coef-ficients b0 and b1.c. Interpret the meaning of b0 and b1 in this problem.d. Predict the mean monthly rent for an apartment that has 800 square feet.e. Why would it not be appropriate to use the model to predict the monthly rent for apartments that have 1,500 square feet?f. Your friends Jim and Jennifer are considering signing a lease for a one-bedroom apartment in this residential neighborhood. They are trying to decide between two apartments, one with 800 square feet for a monthly rent of $1,130 and the other with 830 square feet for a monthly rent of $1,410. Based on (a) through (d), which apartment do you think is a better deal?
square feet Rent ($)
524 1110
616 1175
666 1190
830 1410
450 1210
550 1225
780 1480
815 1490
1070 1495
610 1680
835 1810
660 1625
590 1469
675 1395
744 1150
820 1140
912 1220
628 1434
645 1519
840 1105
800 1130
804 1250
950 1449
800 1168
787 1224
960 1391
750 1145
690 1093
840 1353
850 1530
965 1650
1060 1740
665 1235
775 1550
960 1545
827 1583
655 1575
535 1310
625 1195
749 1200
634 1185
641 1444
860 1385
740 1275
593 1050
880 1650
895 1340
692 1560

Answer 1

Answer:

Check the explanation

Step-by-step explanation:

Scatter plot

x---square feet

y---rent

SolutionA:

Kindly check the attached image below:

THERE EXISTS A WEAK POSITIVE RELATIONSHIP BETWEEN SQUARE FEET AND RENT .

AS SQUARE FEET INCREASES RENT INCREASES

SolutionB:

Rent=0.4932(squarefeet)+992.99

slope=m=0.4932

Y intercept=992.99

SolutionC:

Interpretation of slope:

slope =m=change in rent/change in square foot

For a unit increase in square feet rent increases by 0.4932

Interpretation of y intercept:

when square feet=0 rent is 992.99

Solutiond:

when squarefeet=800

Rent=0.4932(squarefeet)+992.99

=Rent=0.4932(800)+992.99

=1387.55