Real Estate Builder
a Real Estate Builder Wishes to Determine

question 19

Essay

Real Estate Builder
A real estate builder wishes to determine how house size is influenced by family income,family size,and education of the head of household.House size is measured in hundreds of square feet,income is measured in thousands of dollars,and education is measured in years.A partial computer output is shown below.
SUMMARY OUTPUT
$$\begin{array}{l}\text { Regression Statistics }\\\begin{array} { l l } \text { Multiple R } & 0.865 \\\text { R Square } & 0.748 \\\text { Adjusted R Square } & 0.726 \\\text { Standard Error } & 5.195 \\\text { Observations } & 50\end{array}\end{array}$$ ANOVA
$$\begin{array} { | l | c c c c | } \hline & \text { Coeff } & \text { St. Error } & \boldsymbol { t }\boldsymbol {Sat } & \boldsymbol { P } \text {-value } \\\hline \text { Intercept } & - 1.6335 & 5.807 \mathrm { 8 } & - 0.281 & 0 .7798 \\\text { Family Incame } & 0.4485 & 0.1137 & 3.9545 & 0 .0003 \\\text { Family Size } & 4.2615 & 0.8062 & 5.286 & 0 .0001 \\\text { Education } & - 0.6517 & 0.4319 & - 1.509 & 0 .1383 \\\hline\end{array}$$
-{Real Estate Builder Narrative} Which of the following values for the level of significance is the smallest for which all explanatory variables are significant individually: $\alpha$ = .01,.05,.10,or .15?

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Definitions:

Accounts Payable

Liabilities owed by a business to its creditors for goods and services purchased on credit, which are due within a short period.

Debit Memorandum

A document issued by a buyer to a seller indicating returned goods or a request for a price reduction, increasing the buyer's accounts payable.

Sales Returns and Allowances

A reduction in sales revenue for returned goods or provided allowances due to dissatisfaction or defects.

Merchandise Inventory

Goods that a merchandising company holds for the purpose of resale to customers in the ordinary course of business.