An empirical study is done on estimating the value of the houses in a city based on the following underlying factors:

Price= Value of the house (in *1000 Dollars)

Lotsize=Size of the property lot (in acres)

Bedroom= Unit number of bedrooms of a house

Bathroom= Unit number of bathrooms in a house

Driveway= A binary variable specifying if "Driveway=1" the house has a driveway, and if "Driveway=0" otherwise

Garage= A binary variable specifying if "Garage=1" the house has a single-door garage, and if "Garage=0" otherwise

A statistician has reviewed a database of 1000 records of houses sold in the city, and has come up with the following regression equation, to try to find a relationship among variables:

Price(i)=B0 + B1[Lotsize(i)] + B2[Bedroom(i)] + B3[Bathroom(i)] + B4[Driveway(i)] + B5[Garage(i)] +u(i)

A. By reviewing the result of GRETL outcomes in the below attachment, perform a hypothesis test to verify the validity of all slope coefficients, collectively. Show the steps of the deployed hypothesis method.

B. Test if both Driveway & Garage need to be jointly included in the model as important variables in estimating the price of the houses in the city. Make sure you write down all necessary equations & steps required. Show your calculations.

ATTACHMENT:

Model 1: OLS, using observations 1-1000 Dependent variable: Price Coefficient Std. Error t-ratio p-value const 220.811 20.7986 10.62