A real estate agent is interested in how the size of a house (in square feet) af

Question

A real estate agent is interested in how the size of a house (in square feet) affects its sale price (in thousands of dollars). She takes a simple random sample of recent sales of homes with a pool and a sample random sample of 17 recent sales of homes without a pool and combines them into one overall yields a least-squares regression line of y = -28.144 + 0.165 x with r^2 = 0.722. Interpret the slope of the regression line in the context of the study. Interpret the y-intercept of the regression line in the context of the study, or explain why the intercept does not have a valid interpretation. Interpret the r^2 value in the context of the study.

Explanation / Answer

y=-28.144+0.165x, r^2=0.722

a)Slope says that for every one square feet increase in size of the house,the price increases by $165

b)It says that even when I am not buying any house,I am supposed to pay $28144.This doesnt have a valid interpretation because anyone would be ready to buy only when one buys some area.

c)r^2=0.722

Which means that 72.2% of variation in the x variable is explained by the y variable

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