SCENARIO 13-6
One of the Most Common Questions of Prospective

question 93

Multiple Choice

SCENARIO 13-6
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. $$\begin{array}{l}\begin{array} { l r } \hline { \text { Regression Statistics } } \\\hline \text { Multiple R } & 0.5270 \\\text { R Square } & 0.2778 \\\text { Adjusted R Square } & 0.1928 \\\text { Standard Error } & 40.9107 \\\text { Observations } & 20 \\\hline\end{array}\\\end{array}$$
$\begin{array}{lrrrrr}\text { ANOVA }\\\hline&\text { df } & \text { SS } & \text { MS } & F & \text { Significance F }\\\hline\text { Regression } & 2 & 10943.0190 & 5471.5095 & 3.2691 & 0.0629 \\\text { Residual } & 17 & 28452.6027 & 1673.6825 & & \\\text { Total } & 19 & 39395.6218 & & &\end{array}$ 13-22 Multiple Regression $$\begin{array}{l}\begin{array} { l r r r r r r } \hline & \text { Coefficients } &{ \text { Standard Error } } & { \text { t Stat } } & \text { P-volue } & \text { Lower 95\% } & \text { Upper 95\% } \\\hline \text { Intercept } & 448.2925 & 90.7853 & 4.9379 & 0.0001 & 256.7522 & 639.8328 \\\text { Temperature } & - 2.7621 & 1.2371 & - 2.2327 & 0.0393 & - 5.3721 & - 0.1520 \\\text { Insulation } & - 15.9408 & 10.0638 & - 1.5840 & 0.1316 & - 37.1736 & 5.2919 \\\hline\end{array}\\\text { Also } \operatorname { SSR } \left( X _ { 1 } \mid X _ { 2 } \right) = 8343.3572 \text { and } \operatorname { SSR } \left( X _ { 2 } \mid X _ { 1 } \right) = 4199.2672\end{array}$$
-Referring to SCENARIO 13-6, what can we say about the regression model?

• A)The model explains 17.12% of the variability of heating costs; after correcting for the degrees of freedom, the model explains 27.78% of the sample variability of heating costs.
• B)The model explains 19.28% of the variability of heating costs; after correcting for the degrees of freedom, the model explains 27.78% of the sample variability of heating costs.
• C)The model explains 27.78% of the variability of heating costs; after correcting for the degrees of freedom, the model explains 19.28% of the sample variability of heating costs.
• D)The model explains 19.28% of the variability of heating costs; after correcting for the degrees of freedom, the model explains 17.12% of the sample variability of heating costs.

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Definitions:

Positive Adaptation

The ability of an individual to adjust positively to changes, stressors, or adversity, improving resilience and overall well-being.

Personal Resilience

The ability to recover quickly from difficulties; toughness or the capacity to bounce back from adverse life events.

Internal Locus

The belief that one's actions and outcomes are controlled by personal decisions and efforts rather than external factors.

Extraversion

A personality trait characterized by outgoing, sociable, and energetic behavior.