To Examine the Local Housing Market in a Particular Region

question 34

Essay

To examine the local housing market in a particular region, a sample of 120 homes sold during a year are collected. The data are given below:



Partition the data into training (50 percent), validation (30 percent), and test (20 percent) sets. Predict the sale price using k-nearest neighbors with up to k = 10. Use Sale Price as the output variable and all the other variables as input variables. In Step 2 of XLMiner's k-Nearest Neighbors Prediction procedure, be sure to Normalize input data and to Score on best k between 1 and specified value. Generate a Detailed Scoring report for all three sets of data.
a. What value of k minimizes the root mean squared error (RMSE) on the validation data?
b. What is the RMSE on the validation data and test data?
c. What is the average error on the validation data and test data? What does this suggest?

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Definitions:

Collective Efficacy

The shared belief of a group in its conjoint capabilities to organize and execute the courses of action required to produce given levels of attainment.

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Leaders who inspire enthusiasm, devotion, and strong emotional commitment in their followers through their personal charisma, vision, and communication style.

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Refers to beneficial outcomes or impacts that result from certain actions, policies, or circumstances.

Charismatic Leadership

A leadership style characterized by the leader's ability to inspire and motivate followers through their charm, persuasion, and compelling vision.