A Real Estate Builder Wishes to Determine How House Size

question 43

Multiple Choice

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 constructed the multiple regression
Model.The business literature involving human capital shows that education influences an
Individual's annual income.Combined, these may influence family size.With this in mind, what
Should the real estate builder be particularly concerned with when analyzing the multiple
Regression model?

• A) Randomness of error terms
• B) Collinearity
• C) Normality of residuals
• D) Missing observations

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