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Construct a linear regression model that predicts the price of houses in a neighborhood in Canton given their area in square feet and their age

Construct a linear regression model that predicts the price of houses in a neighborhood in Canton given their area in square feet and their age in years

House price in $1000s Square Feet House age (Years)
245 1400 15
312 1600 17
279 1700 13
308 1875 24
199 1100 25
219 1550 20
405 2350 19
324 2450 12
319 1425 14
255 1700 16

(a) Define the design matrix and the true response.

(b) Complete the following tables (Show your work for partial credits). Interpret the results.

E[Coefficients] Variance of Coefficients
Intercept
Square Feet
House age

df SS MS
Regression
Residual
Total

R Squared
Adjusted R Squared
AIC
Standard Error
Number of Observations

(c) Construct proper hypothesis tests to identify the factors that significantly change (statistically) the house price.

(d) Find the expected values and prediction intervals for the following:

Square Feet House age (Years) Expected Price Lower Prediction bound Upper Prediction bound
1700 13
2400 17
4000 5

(e) Interpret the results in the table above.

(f) Check and discuss the potential of multicollinearity between your input factors.

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