Regression Analysis

Regression Analysis

Regression Analysis

Team A has decided to perform a linear regression analysis, an equation that expresses the linear relationship between two variables, to determine if home prices are based on distance. The calculations and tests are based on the real estate data table provided by. The overall opinion of the group is that the distance to the city center determines the price of the home.

h₀: Distance determines price

h₁: Distance does not determine price

For any regression analysis there must be two variables, a dependent (price) and an independent (distance). In order to measure the strength and direction of correlation, one would use a regression equation. According to the least squares principle, the equation for this is Y’ = a + bX. Where Y’ is the predicted Y value, a is the y-intercept, and b is the slope of the line. Team A will be using the data in figure A for their research:

Price Distance Price Distance Price Distance

224 6 147.4 12 263.1 17

270.8 7 217.8 12 224.8 17

312.1 7 220.9 12 228.4 17

246 7 266.6 13 176.3 17

243.7 7 312.1 13 236.8 17

209 8 154.3 13 221.1 18

252.3 8 209.7 13 246.1 18

269.2 8 294 13 190.9 18

294.3 8 240 13 125 18

188.1 8 292.4 14 199 18

227.1 8 192.9 14 221.5 18

179 8 233 14 182.4 19

271.8 9 182.7 14 234 19

345.3 9 192.6 14 216 19

257.2 9 263.2 14 199.8 19

206 9 173.6 14 198.3 19

222.1 9 188.3 14 166.5 19

244.6 9 327.2 15 209.7 19

310.8 9 209.3 15 164.1 19

173.6 9 216.8 15 209.3 20

198.9 10 176 15 205.1 20

177.1 10 254.3 15 236.4 20

207.5 10 294.5 15 188.3 20

179 10 188.3 15 227.1 20

194.4 11 213.6 16 207.5 21

326.3 11 281.3 16 173.1 21

180.4 11 172.7 16 307.8 21

207.1 11 247.7 16 289.8 21

269.9 11 166.2 16 186.7 21

175 11 273.2 16 172.4 23

293.7 11 232.2 16 175.6 24

188.3 11 171.6 16 189.4 24

242.1 12 192.2 16 187 26

245.4 12 253.2 16 139.9 28

251.4 12 155.4 16 125.9 28

In order to interpret the data two variables must be identified (1) coefficient of...