Exhibit 17

question 97

Short Answer

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. Note: The values of relevant test statistics are shown in parentheses below the estimated coefficients.
Refer to Exhibit 17.8.Using Model B,what is the predicted difference between the price of homes with the same square footage located in Location 2 and Location 3?

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Definitions:

Prenatal Development

Prenatal development refers to the process of growth and development within the womb from conception until birth, encompassing various stages of embryo and fetal development.

Zygotic DNA

The genetic material contained within a zygote, which is the cell formed when a sperm cell fertilizes an egg cell.

Prenatal Development

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Trimesters

The three periods of approximately three months each into which pregnancy is typically divided.