A Researcher Has Developed the Following Regression Equation to Predict

question 24

Multiple Choice

A researcher has developed the following regression equation to predict the prices of luxurious Oceanside condominium units, = 40 + 0.15Size + 50View, where Price is the price of a unit (in $1,000s) , Size is the square footage (in sq. feet) , and View is a dummy variable taking on 1 for an ocean view unit and 0 for a bay view unit. Which of the following is the difference in predicted prices of the ocean view and bay view units with the same square footage?

• A) $315,000
• B) $50,000
• C) $265,000
• D) $40,000