A real estate agent believes that the selling price of a house for a particular
ID: 3156607 • Letter: A
Question
A real estate agent believes that the selling price of a house for a particular town is
directly related to the number of square feet the house has. In order to justify his
assumption, he took a sample of 8 homes that has been recently sold, and recorded the
price and size. Using the data collected, compute r, the correlation coefficient.
Use SPSS
To help you get the correlation coefficient.
House Size
(100 ft2)
Selling Price
(in thousands)
12.4
132
12.7
154
13.4
162
14.2
182
14.7
193
16.2
218
17.2
239
19.1
325
A. -0.98 B. 0.90 C. -0.90 D. 0.98
House Size
(100 ft2)
Selling Price
(in thousands)
12.4
132
12.7
154
13.4
162
14.2
182
14.7
193
16.2
218
17.2
239
19.1
325
Explanation / Answer
XY , X2 and Y2 as it was done in the table below.
sum of every column to get:
X=119.9 , Y=1605 , XY=25034.8 , X2=1835.43 , Y2=348027
Use the following formula to work out the correlation coefficient.
r = (nXYXY)/[nX2(X)2][nY2(Y)2]
HENCE USING THE FORMULA WE GET r = 0.98
hence option D is correct
X Y XY XX YY 12.4 132 1636.8 153.76 17424 12.7 154 1955.8 161.29 23716 13.4 162 2170.8 179.56 26244 14.2 182 2584.4 201.64 33124 14.7 193 2837.1 216.09 37249 16.2 218 3531.6 262.44 47524 17.2 239 4110.8 295.84 57121 19.1 325 6207.5 364.81 105625Related Questions
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