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Exhibit 17.8.A realtor wants to predict and compare the prices of homes in three neighboring locations.She considers the following linear models:
Model A: Price = β0 + β1Size + β2Age + ε,
Model B: Price = β0 + β1Size + β2Loc1 + β3Loc2 + ε,
Model C: Price = β0 + β1Size + β2Age + β3Loc1 + β4Loc2 + ε,
where,
Price = the price of a home (in $thousands),
Size = the square footage (in square feet),
Loc1 = a dummy variable taking on 1 for Location 1,and 0 otherwise,
Loc2 = a dummy variable taking on 1 for Location 2,and 0 otherwise.
After collecting data on 52 sales and applying regression,her findings were summarized in the following table.
Financial Statement
A formal record of the financial activities and position of a business, person, or other entity.
Parking Operations
The management and operation of parking facilities, including the planning, financing, and implementation of efficient systems to accommodate vehicles.
Enterprise Fund
A fund established by a government to account for operations financed by user charges, often used for utilities and public services.
Journal Entry
A recording of a transaction in an accounting journal that notes the debits and credits affecting the accounts involved.
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