SCENARIO 13-4
a Real Estate Builder Wishes to Determine How

question 178

Multiple Choice

SCENARIO 13-4
A real estate builder wishes to determine how house size (House) is influenced by family income (Income) and family size (Size) .House size is measured in hundreds of square feet and income is measured in thousands of dollars.The builder randomly selected 50 families and ran the multiple regression.Partial Microsoft Excel output is provided below: $\begin{array}{lr}\hline{\text { Regression Statistics }} \\\hline \text { Multiple R } & 0.8479 \\\text { R Square } & 0.7189 \\\text { Adjusted R Square } & 0.7069 \\\text { Standard Error } & 17.5571 \\\text { Observations } & 50\\\hline \end{array}$

$\text { ANOVA }$
$\begin{array}{lrrrrr} & d f & \text { SS } & {M S} & F & \text { Significance } F \\\hline \text { Regression } & & & 37043.3236 & 18521.6618 & 0.0000 \\\text { Residual } & & 14487.7627 & 308.2503 & \\\text { Total } & & 49 & 51531.0863 & &\end{array}$

$\begin{array}{lrrrr}\hline & \text { Coefficients } & \text { Standard Error } &{t \text { Stat }} & \text { P-value } \\\hline \text { Intercept } & -5.5146 & 7.2273 & -0.7630 & 0.4493 \\\text { Income } & 0.4262 & 0.0392 & 10.8668 & 0.0000 \\\text { Size } & 5.5437 & 1.6949 & 3.2708 & 0.0020\\\hline \end{array}$

$\text { Also } \operatorname{SSR}\left(X_{1} \mid X_{2}\right) =36400.6326 \text { and } \operatorname{SSR}\left(X_{2} \mid X_{1}\right) =3297.7917$


-Referring to SCENARIO 13-4, what are the regression degrees of freedom that are missing from the output?

• A)2
• B)47
• C)49
• D)50

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Definitions:

In-Kind Benefits

Benefits given in the form of goods or services rather than money, often used in social welfare programs.

Poverty Rate

The percentage of the population living below the national poverty line, indicating the proportion of people who cannot afford basic needs.

Absolute Income Scale

A measure of an individual’s or household’s income level, without adjusting for inflation or cost-of-living differences.

Poverty Line

A defined income threshold below which individuals or families are considered to be living in poverty, contextual to each country's standard of living and cost of living.