A real estate agent believes that the market price of a home is linearly related to the square footage of that home, and she would like to predict the market price based on the square footage. She randomly selects 20 houses in her region and records both variables. She finds the following information:

n = 20,r = 0.498, = 107.65x+10500, = 157,500

Use the researcher's result to decide if the variables are linearly related, then make the best prediction for the market price of a home having 1250 square feet.

ANSWER CHOICES

The variables are not linearly related and the best prediction is $157,500.

The variables are linearly related and the best prediction is $157,500.

The variables are linearly related and the best prediction is $145,063.

The variables are not linearly related and the best prediction is $145,063.

No prediction can be made.