By using the Model 1 calculate the predicted insurance expenses of the following people and comment on the predicted charges considering the summary statistics of the medical costs in the sample such as mean and median values. (Use only two digits to the right of the decimal point):

• Person 1: a Southwest non-smoker female person, 30 years old, with a BMI value of 45, who has 2 dependents.
• Person 2: a Northeast smoker male person, 45 years old, with a BMI value of 30, who has no dependents.
• Person 3: a Northwest smoker female person, 25 years old, with a BMI value of 25, who has no dependents.

Multiple regression model 1: Charges= -13029.9 + 256.85*Age + 339.19*BMI + 475.50*Children + 131.31*Female + 23848.53*Smoke + 960.05*Northeast + 607.08*Northwest - 74.97*Southeast . reg Charges Age BMI Children Female Smoke Northeast Northwest Southeast Source SS df MS Number of obs 1, 338 F (8, 1329) 500 . 81 Model 1 . 4723e+11 8 1. 8404e+10 Prob > F 0 . 0000 Residual 4. 8840e+10 1, 329 36749084.4 R-squared II 0 . 7509 Adj R-squared II 0. 7494 Total 1. 9607e+11 1, 337 146652372 Root MSE 6062. 1 Charges Coef. Std. Err. t P>| t| [95% Conf. Interval] Age 256 . 8564 11 . 89885 21.59 0 . 000 233 . 5138 280 . 1989 BMI 339 . 1935 28. 59947 11 . 86 0 . 000 283 . 0884 395 . 2985 Children 475 . 5005 137 . 8041 3 . 45 0. 001 205. 1633 745 . 8378 Female 131 . 3144 332 . 9454 0.39 0 . 693 -521. 8415 784. 4703 Smoke 23848.53 413 . 1534 57. 72 0. 000 23038.03 24659 . 04 Northeast 960 . 051 477 .933 2. 01 0 . 045 22 . 46565 1897 . 636 Northwest 607 . 0871 477 . 2039 1. 27 0. 204 -329 . 0679 1543 . 242 Southeast -74. 97102 470 . 6386 -0. 16 0. 873 -998. 2467 848 . 3046 _cons -13029.9 1032 . 967 -12 . 61 0.000 -15056.33 -11003. 48Multiple Regression Model 1: Charges = 30 + [31 * Age + [32 * BMI + [33 * Children + [3,, * Female + [35 * Smoke + 35 * Northeast + [3, * Northwest + BB * Southeast Multiple Regression Model 3: Charges = [30 + Bl t Age + [32 I: BMI + [33 2: Children + [34 a: Male + [35 I: Smoke_Fl'ee + 36 a: Northeast + B, a: Northwest + BB * Southwest where Smoke: A dummy variable which is equal to 1 if aperson is a smoker, and to 0 if the person is not a smoker. Smoke_li'ree: A dummy variable which is equal to 1 if a person is not a smoker, and to 0 if the person is a smoker. Northeast: A dummy variable which is equal to 1 if a person is from Northeast, and to 0 if the person is not the Northeast region. Northwest: A dummy variable which is equal to 1 if a person is from Northwest, and to 0 if the person is not the Northwest region. Southeast: A dummy variable which is equal to 1 if a person is from Southeast ,and to 0 if the person is not the Southeast region. Southwest: A dummy variable which is equal to 1 if a person is from Southwest, and to 0 if the person is not the Southwest region