SCENARIO 14-6 One of the Most Common Questions of Prospective House Buyers

question 21

Multiple Choice

SCENARIO 14-6
One of the most common questions of prospective house buyers pertains to the cost of heating in dollars (Y) . To provide its customers with information on that matter, a large real estate firm used the following 2 variables to predict heating costs: the daily minimum outside temperature in degrees of Fahrenheit ( X₁ ) and the amount of insulation in inches ( X ₂ ) . Given below is EXCEL output of the regression model.



Also SSR (X₁ | X₂) = 8343.3572 and SSR (X₂ | X₁) = 4199.2672
-Referring to Scenario 14-5,which of the following values for is the smallest for which the regression model as a whole is significant?

• A)0.00005
• B)0.001
• C)0.01
• D)0.05

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Definitions:

Maximize Utility

The process or goal of obtaining the highest level of satisfaction or benefit from consuming goods and services, given a consumer's limitations, such as income or resources.

Income

The financial gain received by an individual or entity, typically measured over a period of time, deriving from labor, investment, or business ventures.

Marginal Utility

The additional satisfaction or benefit received by consuming one more unit of a good or service.

Money Income

The total amount of monetary earnings received by an individual or household before any deductions like taxes or social security contributions.