TABLE 17-1 A Real Estate Builder Wishes to Determine How House Size

question 143

Multiple Choice

TABLE 17-1
A real estate builder wishes to determine how house size (House) is influenced by family income (Income) ,family size (Size) ,and education of the head of household (School) .House size is measured in hundreds of square feet,income is measured in thousands of dollars,and education is in years.The builder randomly selected 50 families and ran the multiple regression.Microsoft Excel output is provided below:
-Referring to Table 17-1,what minimum annual income would an individual with a family size of 9 and 10 years of education need to attain a predicted 5,000 square foot home (House = 50) ?

• A)$44.14 thousand
• B)$56.75 thousand
• C)$178.33 thousand
• D)$211.85 thousand

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Definitions:

Present Value Method

A technique used to determine the present value of future cash flows or income streams to evaluate investment projects or financial products.

Net Market Value

The amount that could be obtained from selling an asset in the market after deducting any selling costs or liabilities.

Uncertainty

The state of having limited knowledge where it is impossible to exactly describe the existing state, a future outcome, or more than one possible outcome.

Provisions

Liabilities of uncertain timing or amount, set aside for future expenses or liabilities.