A Researcher Has Developed the Following Regression Equation to Predict

question 72

Multiple Choice

A researcher has developed the following regression equation to predict the prices of luxurious Oceanside condominium units, = 40 + 0.15 Size + 50 View,where Price = the price of a unit (in $1,000s) ,Size = the square footage (in sq.feet) ,View = 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) $40,000
• B) $90,000
• C) $500,000
• D) $50,000

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