An Real Estate Analyst Believes That the Three Main Factors

question 46

Multiple Choice

An real estate analyst believes that the three main factors that influence an apartment's rent in a college town are the number of bedrooms,the number of bathrooms,and the apartment's square footage.For 40 apartments,she collects data on the rent (y,in $) ,the number of bedrooms (x₁) ,the number of bathrooms (x₂) ,and its square footage (x₃) .She estimates the following model as Rent = β₀ + β₁ Bedroom + β₂ Bath + β₃ Sqft + ε.The following ANOVA table shows a portion of the regression results. The coefficient of determination indicates that __________.

• A) 19.08% of the variation in Rent is explained by the variation in the explanatory variables
• B) 19.08% of the variation in the explanatory variables is explained by the variation in Rent
• C) 80.92% of the variation in Rent is explained by the variation in the explanatory variables
• D) 80.92% of the variation in the explanatory variables is explained by the variation in Rent

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Definitions:

Trade

The exchange of goods, services, or both between two or more parties, either across international borders or within a single market.

Value

The importance, worth, or usefulness of something, often in economic terms as perceived by the consumer.

Production

The process of creating goods and services through the combination of labor, capital, and resources.

Division of Labor

The allocation of different tasks to different people or groups in an effort to improve efficiency.